OFFER FOR SUBSCRIPTION BY LIPPO-MAPLETREE INDONESIA RETAIL TRUST MANAGEMENT LTD.

INDONESIA RETAIL TRUST

LIPPO-MAPLETREE
Prospectus dated 9 November 2007

LIPPO-MAPLETREE
INDONESIA RETAIL TRUST
(A real estate investment trust constituted on 8 August 2007 under the laws of the Republic of Singapore)

645,469,000 Units
(Subject to the Over-allotment Option)

Offering Price

S$0.80 per Unit

Registered with the Monetary Authority of Singapore on 9 November 2007 This document is important. If you are in any doubt as to the action you should take, you should consult your stockbroker, bank manager, solicitor, accountant or other professional adviser. Lippo-Mapletree Indonesia Retail Trust Management Ltd.(Company Registration No. 200707703M), as manager (the Manager) of Lippo-Mapletree Indonesia Retail Trust (LMIR Trust), is making an offering (the Offering) of 645,469,000 units representing undivided interests in LMIR Trust (Units) for subscription at the offering price (the Offering Price) of S$0.80 for each Unit. The Offering consists of (i) an international placement of 625,469,000 Units to investors, including institutional and other investors in Singapore (the Placement) and (ii) an offering of 20,000,000 Units to the public in Singapore (the Public Offer). The Offering will be underwritten at the Offering Price by UBS AG, acting through its business group, UBS Investment Bank (UBS), BNP Paribas Capital (Singapore) Ltd. (BNP) and OverseaChinese Banking Corporation Limited (OCBC Bank, and together with UBS and BNP, the Joint Lead Managers, Issue Managers and Underwriters). UBS is the sole financial adviser to the Offering (the Financial Adviser). Separate from the Offering, each of Lippo Strategic Holdings Inc. (Lippo Strategic) and Mapletree LM Pte. Ltd. (Mapletree LM) (collectively, the Cornerstone Investors) has entered into a cornerstone subscription agreement with the Manager (collectively, the Cornerstone Subscription Agreements) to subscribe for 287,695,000 units and 127,250,000 units respectively at the Offering Price (the Cornerstone Units), conditional upon the underwriting agreement in connection with the Offering (the Underwriting Agreement) having been entered into and not having been terminated pursuant to its terms on or prior to the Listing Date (as defined herein). Prior to the Offering, there has been no market for the Units. The offer of Units under this Prospectus will be by way of an initial public offering in Singapore. Application has been made to Singapore Exchange Securities Trading Limited (the SGX-ST) for permission to list on the Main Board of the SGX-ST (i) all the Units to be issued pursuant to the Offering, (ii) all the Cornerstone Units, and (iii) all the units which will be issued to the Manager from time to time in full or part payment of the Managers management fees, including its acquisition fee and divestment fee. Such permission will be granted when LMIR Trust has been admitted to the Official List of the SGX-ST (the Listing Date). Acceptance of applications for Units will be conditional upon issue of the Units and upon permission being granted by the SGX-ST to list the Units. In the event that such permission is not granted or if the Offering is not completed for any other reason, application monies will be returned in full, at each investors own risk, without interest or any share of revenue or other benefit arising therefrom, and without any right or claim against LMIR Trust, the Manager, HSBC Institutional Trust Services (Singapore) Limited, as trustee of LMIR Trust (the Trustee), PT. Lippo Karawaci Tbk (the Sponsor), PT. Consulting & Management Services Division (the Property Manager) or any of the Joint Lead Managers, Issue Managers and Underwriters. LMIR Trust has received a letter of eligibility from the SGX-ST for the listing and quotation of Units on the Main Board of the SGX-ST. LMIR Trusts eligibility to list on the Main Board of the SGX-ST is not an indication of the merits of the Offering, LMIR Trust, the Manager, or the Units. The SGX-ST assumes no responsibility for the correctness of any statements or opinions made or reports contained in this Prospectus. Admission to the Official List of the SGX-ST is not to be taken as an indication of the merits of the Offering, LMIR Trust, the Manager or the Units. Investors who are members of the Central Provident Fund in Singapore (CPF) may use their CPF Ordinary Account savings to purchase or subscribe for Units as an investment included under the CPF Investment Scheme Ordinary Account. CPF members are allowed to invest up to 35.0% of the Investible Savings (as defined herein) in their CPF Ordinary Accounts to purchase or subscribe for Units. LMIR Trust is an authorised scheme under the Securities and Futures Act, Chapter 289 of Singapore (the Securities and Futures Act or the SFA). A copy of this Prospectus has been lodged with the Monetary Authority of Singapore (the MAS) on 19 October 2007, amended on 22 October 2007 and registered by the MAS on 9 November 2007, respectively. The MAS assumes no responsibility for the contents of this Prospectus. Lodgement with, or registration by, the MAS of this Prospectus does not imply that the Securities and Futures Act or any other legal or regulatory requirements have been complied with. The MAS has not, in any way, considered the investment merits of the collective investment scheme. This Prospectus will expire on 9 November 2008 (12 months after the date of the registration). See Risk Factors commencing on page 65 of this Prospectus for a discussion of certain factors to be considered in connection with an investment in the Units. None of the Manager, the Trustee, the Sponsor, the Property Manager or the Joint Lead Managers, Issue Managers and Underwriters guarantees the performance of LMIR Trust, the repayment of capital or the payment of a particular return on the Units. Investors applying for Units by way of Application Forms or Electronic Applications (both as referred to in Appendix G Terms, Conditions and Procedures for Application for and Acceptance of the Units in Singapore) in the Public Offer will be required to pay the Offering Price on application, subject to a refund of the full amount or, as the case may be, the balance of the application monies (in each case, without interest or any share of revenue or other benefit arising therefrom), where (i) an application is rejected or accepted in part only, or (ii) the Offering does not proceed for any reason. In connection with the Offering, the Underwriters have been granted an over-allotment option (the Over-allotment Option) by Lippo Strategic, as unit lender (the Unit Lender), exercisable by UBS (the Stabilising Manager), in consultation with the other Underwriters, in full or in part, on one or more occasions, no later than the earliest of (i) the date falling 30 days from the date of commencement of trading of the Units on the SGX-ST, (ii) the date when the Stabilising Manager has bought on the SGX-ST, an aggregate of 96,820,000 Units, representing not more than 15.0% of the total Units offered, to undertake stabilising actions or (iii) the date falling 30 days after the date of adequate public disclosure of the final price of the Units, to purchase from the Unit Lender up to an aggregate of 96,820,000 Units at the Offering Price, solely to cover the over-allotment of Units (if any), subject to any applicable laws and regulations. The total number of outstanding Units immediately after the completion of the Offering, including the Cornerstone Units, will be 1,060,414,000 Units. The exercise of the Over-allotment Option will not increase this total number of Units outstanding. The Units have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the Securities Act) and, subject to certain exceptions, may not be offered or sold within the United States. The Units are being offered and sold only outside the United States (including to institutional and other investors in Singapore) in reliance on Regulation S under the Securities Act ("Regulation S").

Sole Financial Adviser to the Sponsor

Sole Financial Adviser to the Offering

Joint Lead Managers, Issue Managers and Underwriters

LIPPO-MAPLETREE
INDONESIA RETAIL TRUST

LIPPO-MAPLETREE INDONESIA RETAIL TRUST

Lippo-Mapletree Indonesia Retail Trust (LMIR Trust) is a Singapore-based real estate investment trust (REIT) established with the principal investment objective of owning and investing on a long-term basis in a diversified portfolio of incomeproducing real estate in Indonesia that are primarily used for retail and/or retail-related purposes, and real estate related assets in connection with the foregoing purposes. LMIR Trusts initial asset portfolio will comprise seven retail mall properties (Retail Malls) and seven retail spaces located within other retail malls (Retail Spaces, and collectively with the Retail Malls, the Properties) valued at S$1,004.7 million(1). The Properties are strategically located in major cities of Indonesia with large population catchment areas and are accessible via major transportation routes and highways.
(1)

As at 30 June 2007, the Properties were valued at an aggregate of S$1,004.7 million by Knight Frank / PT. Willson Properti Advisindo, as the Independent Valuer to the Manager (Knight Frank) and at S$1,016.3 million by Colliers International / PT Penilai, as the Independent Valuer to the Trustee (Colliers). The Manager has adopted Knight Franks valuation as the basis for determination of the fair market value of the Properties and the net asset value per Unit.

Gajah Mada Plaza Metropolis Town Square Mall WTC Matahari The Plaza Semanggi Mal Lippo Cikarang

Medan

Grand Palladium Medan

Depok Town Square Cibubur Junction

Kalimantan

Ekalokasari Plaza

Sumatra Sulawesi Sarmi Irian Jaya

Makassar
Semarang Surabaya

Istana Plaza

Palembang

Java Supermal Malang Town Square

Jakarta

Java

Bandung

Bali

Sumbawa

Plaza Madiun Retail Malls Retail Spaces Bandung Indah Plaza

Three of the Retail Malls are located in Jakarta, two in Greater Jakarta (an area encapsulated by Jakarta, Bogor, Depok, Tangerang and Bekasi) and the remaining two in Bandung, the fourth largest populated city in Indonesia. As at 30 June 2007, the Retail Malls had an aggregate Net Lettable Area (NLA) of 219,382 sq m and a weighted average occupancy rate of 91.6% based on Committed Leases. Supported by their diverse trade mix and strategic locations, the Retail Malls provide shoppers with comprehensive one-stop shopping, dining and entertainment destinations. Tenants include leading domestic retailers such as Matahari and Rimo Department Stores, as well as international specialty tenants such as Fitness First, Starbucks and McDonalds. The Retail Spaces have a total NLA of 94,070 sq m as at 30 June 2007, are predominantly utilised as department stores, supermarkets, hypermarkets and/or amusement centres and are housed within other retail malls. Three of the Retail Spaces are located in Greater Jakarta and the remaining four in the cities of Semarang, Madiun, Malang and Medan. The Retail Spaces are master-leased to PT. Matahari Putra Prima Tbk, Indonesias largest retailer by sales revenue(2), for an initial term of 10 years with fixed rental growth of 8.0% per annum for the first four years and a revenue sharing formula thereafter.
(2)

PT. Matahari Putra Prima Tbk is Indonesias largest retailer by sales revenue with over Rp. 8,487.7 billion (approximately S$1,436.0 million) in annual sales for the financial year ended 31 December 2006.

1. Gajah Mada Plaza Prominently located in the heart of Jakartas Chinatown with a strong leisure and entertainment component o Location : Jalan Gajah Mada, Central Jakarta; (3) o Appraised Value : S$103.8 m; (4) o Gross Floor Area : 66,160 sq m; o Net Lettable Area(4) : 34,278 sq m; o Occupancy Rate(4) : 89.1%. 2. Cibubur Junction Located in the middle of Cibubur, one of the most affluent and upmarket residential areas in Jakarta o Location : Jalan Jambore Raya 1, Cibubur, East Jakarta; (3) o Appraised Value : S$94.2 m; (4) o Gross Floor Area : 49,341 sq m; o Net Lettable Area(4) : 34,139 sq m; o Occupancy Rate(4) : 86.4% 3. The Plaza Semanggi Located in the heart of Jakartas CBD within the citys Golden Triangle o Location : Jalan Jend. Sudirman, South Jakarta; (3) o Appraised Value : S$214.8 m; (4) o Gross Floor Area : 91,232 sq m; o Net Lettable Area(4) : 58,685 sq m; o Occupancy Rate(4) : 96.4% 4. Mal Lippo Cikarang The main shopping centre in the Lippo Cikarang estate with limited competition within an approximately 10-km radius
o Location o o o o : Value(3) :

1. Gajah Mada Plaza

2. Cibubur Junction

3. The Plaza Semanggi

Retail Malls As at Listing Date, LMIR Trusts property portfolio will comprise seven Retail Malls with a NLA of 219,382 sq m. Five of the Retail Malls are located in Bogor, Depok, Tangerang and Bekasi (Greater Jakarta) and the remaining two in Bandung, the fourth largest populated city in Indonesia. As at 30 June 2007, the Retail Malls had a weighted average occupancy of approximately 91.6% based on Committed Leases.

4. Mal Lippo Cikarang

Appraised Gross Floor Area(4) : Net Lettable Area(4) : Occupancy Rate(4) :

Jalan MH Thamrin, Lippo Cikarang; S$80.2 m; 25,767 sq m; 17,974 sq m; 96.3%.

5. Ekalokasari Plaza Located south east of the Bogor City Centre and has recently completed a S$2.0 million expansion and renovation programme o Location : Jalan Siliwangi 123, Bogor, Greater Jakarta; (3) o Appraised Value : S$66.0 m; (4) o Gross Floor Area : 39,895 sq m; o Net Lettable Area(4) : 20,587 sq m; o Occupancy Rate(4) : 87.3%. 6. Bandung Indah Plaza Located in the heart of Bandungs CBD o Location : Jalan Merdeka, Bandung, West Java; (3) o Appraised Value : S$124.5 m; (4) o Gross Floor Area : 55,196 sq m; o Net Lettable Area(4) : 26,472 sq m; o Occupancy Rate(4) : 83.2% 7. Istana Plaza Located in the CBD of Bandung at the junction between two busy roads o Location : Jalan Pasirkaliki, Bandung, West Java; (3) o Appraised Value : S$125.7 m; (4) o Gross Floor Area : 37,434 sq m; o Net Lettable Area(4) : 27,247 sq m; o Occupancy Rate(4) : 98.9%.

5. Ekalokasari Plaza

6. Bandung Indah Plaza

7. Istana Plaza

(3) All appraised values are by Knight Frank as at 30 June 2007. (4) As at 30 June 2007.

Key Investment Highlights

Strong acquisition growth potential The Sponsor has granted LMIR Trust, for so long as (i) Lippo-Mapletree Indonesia Retail Trust Management Ltd. remains the manager of LMIR Trust; and (ii) the Sponsor and/or any of its related corporations, alone or in aggregate, remains a controlling shareholder of the Manager, a right of first refusal (the ROFR) over any retail properties located in Indonesia subject to certain conditions. As at Listing Date, the scope of the ROFR encompasses five properties currently under development by the Sponsor and/or its subsidiaries:
Estimated Gross Floor Area ("GFA") (sq m)

ROFR Properties Under Development

Location

Expected Date of Completion

Estimated NLA (sq m)

Binjai Supermall Pejaten Mall Kuta Beach Mall Kemang City Mall Puri "Paragon City" Total

North Sumatra South Jakarta Kuta, Bali South Jakarta West Jakarta

Fourth quarter of 2007 Second quarter of 2008 Second half of 2008 First half of 2009 Second half of 2009

23,615 57,948 41,562 77,555 196,400 397,080

18,300 40,327 30,735 56,052 127,660 273,074

If LMIR Trust acquires all the ROFR Properties, the aggregate NLA of LMIR Trusts initial property portfolio will increase by over 270,000 sq m, an increase of 87.4% of the aggregate NLA of LMIR Trusts initial property portfolio as at 30 June 2007. The Sponsor is expected to continue developing retail malls across Indonesia, further enhancing the acquisition pipeline for LMIR Trust. Ownership of retail malls in Indonesia is highly dispersed and fragmented, providing LMIR Trust with significant opportunities for such acquisitions. As at the Latest Practicable Date, the Manager has entered into non-binding memoranda of understanding in respect of the potential acquisition of the following malls:
Estimated date of acquisition by LMIR Trust

Location

GFA (sq m)

NLA (sq m)

Cosmopolitan Mall Pluit Sun Plaza Supermal Pakuwon Indah and Pakuwon Trade Centre Total

North Jakarta North Sumatra West Surabaya, East Java

131,013 73,871 289,563 494,447

88,040 61,348 114,834 264,222

Second half of 2008 Within six months after the Listing Date Within six months after the Listing Date

Exposure to the growing Indonesian retail sector Real GDP growth in Indonesia is forecast to increase from 5.5% in 2006 to 6.0% in 2007 and 6.1% in 2008. Average growth rate from 2007 to 2011 is forecast at 5.7%(5). Nominal retail sales growth has averaged 11.0% per annum since 1999 with the growth rate forecast to continue from 2007 to 2011(5). Retail sales have also been boosted by a lifestyle shift towards a higher level of consumerism, particularly among the urban middle income group in major Indonesian cities such as Jakarta, Bandung, Semarang and Medan.
(5)

According to PT Jones Lang LaSalle

Stable and Growing Distributions

Forecast and Projected DPU(7) (Cents)

Majority of Forecast and Projected Gross Rent Already Committed (S$ m)

91.6

5.84

6.27

84.8

2.74

40.1
91.3%

80.9%

66.8%

Forecast Period 2007(8)

Projection Year 2008

Projection Year 2009

Forecast Period 2007(9)

Projection Year 2008

Projection Year 2009

(7) Based on the Offering Price of S$[] and the various assumptions set out in the Prospectus under the heading Profit Forecast and Profit Projection. (8) Based on the number of Units that are assumed to be in issue as at the Listing Date. It is assumed that the number of Units eligible for distribution is the same throughout Forecast Period 2007. (9) Annualised Figures for Forecast Period 2007

LMIR Trusts distribution policy is to distribute 100% of its tax-exempt income and capital receipts for the period from Listing Date to 31 December 2007, the year ending 31 December 2008 (Projection Year 2008) and the year ending 31 December 2009 (Projection Year 2009) and at least 90% of its tax-exempt income thereafter. Distributions will be paid on a quarterly basis for the three-month periods ending on 31 March, 30 June, 30 September and 31 December each year. LMIR Trusts first distribution after the Listing Date will be paid by the manager on or before 30 May 2008. Potential for growth through active asset management and tenant re-mixing The Manager intends to undertake active asset management to maximise the value and performance of the Properties. Three of the Retail Malls have recently completed extensive asset enhancement works and a fourth Retail Mall, The Plaza Semanggi, is currently undergoing asset enhancement works. The completion of these asset enhancement works are expected to enhance the positioning and branding of the Retail Malls within their respective trade areas and increase shopper traffic. The Sponsor of LMIR Trust is PT. Lippo Karawaci Tbk, Indonesias largest listed property company The Sponsor is an internationally recognised corporation and is the largest listed property company in Indonesia(6) by market capitalisation. It has a recognised track record and dominant position within the retail and retail property industry in Indonesia, with the ability to identify and enhance under-valued retail properties and leverage its extensive retail network.
(6)

Based on its market capitalisation on the Jakarta Stock Exchange (JSX) of Rp. 10,609.2 billion (approximately S$1.8 billion) and a closing price of Rp. 1,790.0 on the JSX as at 18 October 2007

The Manager, Lippo-Mapletree Indonesia Retail Trust Management Ltd., is jointly owned by Lippo Karawaci and the Mapletree Group The Manager is incorporated in Singapore and indirectly 60.0% owned by the Sponsor and 40.0% owned by Mapletree Capital, a wholly-owned subsidiary of Mapletree Investments Pte Ltd (MIPL). The Mapletree Group, which MIPL is a part of, has an asset base of approximately S$4.5 billion (as at 30 June 2007) comprising office, logistics, industrial, residential and retail/lifestyle properties. The interests of Lippo Strategic, an affiliate of the Sponsor, and the Mapletree Group are substantially aligned with those of Unitholders Lippo Strategic and the Mapletree Group (through MIPL) will each own 27.1% and 12.0%, respectively, of the total issued Units of LMIR Trust as at the Listing Date, assuming that the Over-Allotment Option is not exercised.

Locked-in master leases with rental step-ups for the Retail Spaces As at the Listing Date, the Retail Spaces will be master-leased to PT. Matahari Putra Prima Tbk (Matahari) for 10 years with an option for the Master Lessee to renew for a further 10 years. Rental income is scheduled to increase by 8.0% per annum for the period from FY2008 to FY2011 and in accordance with a revenue sharing formula thereafter. Hedging strategies to minimise exposure arising from interest rates and currency fluctuations The Trustee has entered into foreign exchange hedges equivalent to 100.0% of LMIR Trusts estimated distributions for a total term of five years. Thereafter it intends to continually hedge distributions on a rolling basis. Optimal capital structure LMIR Trust will not incur any borrowings as at the Listing Date and will have substantial ability to incur indebtedness to fund future acquisitions and asset enhancement initiatives. Tax exemptions in Singapore Dividends and interest received in respect of the Properties are exempt from Singapore income tax. Distributions made out of such tax-exempt income are also exempt from tax in the hands of the Unitholders. Competent and experienced personnel LMIR Trust intends to leverage on the experience and expertise of its Board to implement its planned strategies.

Key Investment Highlights

Competitive Strengths

The Properties are located in major cities of Indonesia amidst a growing and affluent urban middle class The properties are mainly located within Greater Jakarta and Bandung, Indonesias fourth most populous city. From 2001 to 2006, total household expenditure in Jakarta and Bandung has increased by an average of 12.8% and 11.5% per annum respectively. Retail spending in these cities has been further boosted by a shift in lifestyle towards a higher level of consumerism, partially brought about by the introduction of foreign brands and designer labels. High growth potential from favourable demographics of the Indonesian population The share of population of the middle income group in Indonesia has steadily grown from 50.0% in 2001 to 64.0% in 2006. It is estimated that the urban middle income population in Indonesia totals approximately 66 million people(10),
(10) (See Appendix F - Independent Report on the Indonesia Retail Property Market.)

Retail Malls and Retail Spaces strategically located within well-established population catchment areas. The Retail Malls are strategically located throughout Greater Jakarta with a population range of between approximately 0.4 million and 2.2 million within their respective primary catchment areas. The Retail Spaces are strategically located throughout Greater Jakarta and in the major cities of Semarang, Medan, Madiun and Malang. Quality Retail Malls which cater to the daily needs of shoppers The Retail Malls are anchored by supermarkets, hypermarkets or department stores, which draw significant shopper traffic whilst the specialty, food & beverage and lifestyle and entertainment tenants provide shoppers with a wide product offering and a complete shopping experience. Economies of scale through portfolio management of the Retail Malls The Retail Malls will be able to leverage upon the Property Managers and the Sponsors experience and will be managed by a specialised team of professionals. Quality tenant base The Retail Malls have a large combined tenant base of over 1,400 tenants (as at 30 June 2007) providing trade as well as product diversification. Top tenants include well-known international and domestic retailers and brand names such as Giant Hypermarket, Gramedia bookstore, Starbucks, Giordano, Fitness First, Sports Station, Matahari Department Store, Hypermart and Studio 21 Cinema. Advance rental payment structure minimises cashflow volatility Retail tenants in Indonesia typically pay an advance rental of approximately 10% to 20% of the total rent payable for the duration of the lease upon signing the lease agreement. This advance rental payment helps to minimise LMIR Trusts cash flow volatility due to potential rental arrears.

1. Mall WTC Matahari Units

1. Mall WTC Matahari Units Strategically located on the main road connecting the BSD residential estate, the largest residential estate in Greater Jakarta o Location : Jalan Raya Serpong, Tangerang, Greater Jakarta; o Appraised Value(3) : S$25.2 m; o Net Lettable Area(4) : 11,184 sq m; o Current Utilisation : Hypermart, Matahari Department Store and Timezone 2. Metropolis Town Square Units A one-stop shopping mall located along one of the main roads in Tangerang o Location : Jalan Hartono Raya, Tangerang, Greater Jakarta; o Appraised Value(3) : S$33.5 m; o Net Lettable Area(4) : 15,248 sq m; o Current Utilisation : Hypermart, Matahari Department Store and Timezone 3. Depok Town Square Units Depok Town Square is located adjacent to the University of Indonesia and has direct access to Pondok Cina Railway Station o Location : Jalan Margonda Raya, Depok, Greater Jakarta; (3) o Appraised Value : S$25.7 m; (4) o Net Lettable Area : 13,045 sq m; o Current Utilisation : Hypermart, Matahari Department Store and Timezone 4. Java Supermall Units Located in Semarang, capital of Central Java province and the fifth largest city in terms of population in Indonesia o Location : Jalan MT Haryono, Semarang, Central Java; (3) o Appraised Value : S$26.0 m; (4) o Net Lettable Area : 11,082 sq m; o Current Utilisation : Matahari Department Store and Foodmart supermarket 5. Malang Town Square Units Conceptualised as an international lifestyle mall, the biggest and most comprehensive mall in Malang o Location : Jalan Veteran, Malang, East Java; (3) o Appraised Value : S$25.5 m; (4) o Net Lettable Area : 11,065 sq m; o Current Utilisation : Hypermart, Matahari Department Store and Timezone 6. Plaza Madiun The biggest mall in Madiun, located along Pahlawan Street, a major road of the city
o Location Appraised Value(3) :

2. Metropolis Town Square Units

3. Depok Town Square Units

Retail Spaces The Retail Spaces occupy a total NLA of 94,070 sq m and and are strategically located as anchor spaces within retail malls. Three of the seven Retail Spaces are located within Greater Jakarta and four are situated in the major cities of Semarang, Medan, Madiun and Malang.

4. Java Supermall Units

5. Malang Town Square Units

6. Plaza Madiun

7. Grand Palladium Medan Units

o : o Net Lettable Area(4) : o Current Utilisation :

Jalan Pahlawan, Madiun, East Java; S$33.4 m; 19,029 sq m; Matahari Department Store and Foodmart supermarket

7. Grand Palladium Medan Units Located within the Medan CBD and surrounded by government and business offices and the town hall o Location : Jalan Kapt. Maulana Lubis, Medan, North Sumatra; o Appraised Value(3) : S$26.2 m; o Net Lettable Area(4) : 13,417 sq m; o Current Utilisation : Hypermart, Matahari Department Store and Timezone

Strategy

The Managers key objectives are to deliver regular and stable distributions to Unitholders and to achieve long-term growth in the NAV per Unit in order to provide Unitholders with capital appreciation on their investments. The Manager plans to achieve these objectives through the following strategies: i) Acquisition Growth Strategy LMIR Trusts acquisition growth strategy envisages investments in retail and/or retail-related assets that are in the interest of Unitholders ii) Active Asset Enhancement and Management Strategy Implementing pro-active measures to enhance the returns from existing and future properties. Such measures may include: Addition and alteration works Leveraging and enhancing the properties competitive strengths to optimise rentals Enhancement projects to maintain competitive positioning of the properties iii) Capital And Risk Management Strategy The key aspects of the proposed capital and risk management strategy are as follows: Maintain a strong balance sheet by adopting and maintaining a target gearing ratio Secure diversified funding sources from financial institutions and capital markets Adopt a proactive strategy to manage risks related to interest rate fluctuations Manage the foreign exchange exposure through hedging, where appropriate

Notice to investors
No person is authorised to give any information or to make any representation not contained in this Prospectus and any information or representation not so contained must not be relied upon as having been authorised by or on behalf of LMIR Trust, the Manager, the Trustee, the Financial Adviser, the Underwriters, the Sponsor or the Property Manager. Neither the delivery of this Prospectus nor any offer, subscription, sale or transfer made hereunder shall under any circumstances imply that the information herein is correct as at any date subsequent to the date hereof or constitute a representation that there has been no change or development reasonably likely to involve a material adverse change in the business, affairs, conditions and prospects of LMIR Trust, the Manager, the Trustee or the Units since the date on the front cover of this Prospectus. Where such changes occur and are material or required to be disclosed by law, the SGX-ST and/or any other regulatory or supervisory body or agency, the Manager will make an announcement of the same to the SGX-ST and, if required, lodge and issue a supplementary document or replacement document pursuant to Section 298 of the Securities and Futures Act and take immediate steps to comply with the said Section 298. Investors should take notice of such announcements and documents and upon release of such announcements and documents shall be deemed to have notice of such changes. No representation, warranty or covenant, express or implied, is made by any of LMIR Trust, the Manager, the Trustee, the Financial Adviser, the Underwriters, the Sponsor, the Property Manager or any of their respective affiliates, directors, officers, employees, agents, representatives or advisers as to the accuracy or completeness of the information contained herein, and nothing contained in this Prospectus is, or shall be relied upon as, a promise, representation or covenant by any of LMIR Trust, the Manager, the Underwriters, the Sponsor, the Property Manager or the Trustee or their respective affiliates, directors, officers, employees, agents, representatives or advisers. Investors acknowledge that no person has been authorised to give any information or to make any representation concerning LMIR Trust or the Units other than as contained in this Prospectus, and, if given or made, such other information or representation should not be relied upon as having been authorised by LMIR Trust, the Manager, the Trustee, the Sponsor, the Property Manager, the Financial Adviser or the Underwriters. None of LMIR Trust, the Manager, the Financial Adviser, the Underwriters, the Sponsor, the Property Manager and the Trustee or any of their respective affiliates, directors, officers, employees, agents, representatives or advisers is making any representation or undertaking to any purchaser or subscriber of the Units regarding the legality of an investment by such purchaser or subscriber under appropriate legal, investment or similar laws. In addition, this Prospectus is offered solely for the purpose of the Offering and investors in the Units should not construe any information contained in this Prospectus as legal, business, financial or tax advice. Investors should be aware that they are required to bear the financial risks of an investment in the Units, and may be required to do so for an indefinite period of time. Investors should consult their own professional advisers as to the legal, tax, business, financial and related aspects of an investment in the Units. Copies of this Prospectus and the Application Forms may be obtained on request, subject to availability, during office hours, from: UBS AG, acting through its business group, UBS Investment Bank One Raffles Quay #50-01 North Tower Singapore 048583 BNP Paribas, Singapore Branch 20 Collyer Quay Tung Centre #01-01 Singapore 049319 Oversea-Chinese Banking Corporation Limited 65 Chulia Street OCBC Centre Singapore 049513

and, where applicable, from members of the Association of Banks in Singapore, members of the SGX-ST and merchant banks in Singapore. A copy of this Prospectus is also available on the SGX-ST website: http://www.sgx.com.
i

The distribution of this Prospectus and the offering, subscription, purchase, sale or transfer of the Units in certain jurisdictions may be restricted by law (see Plan of DistributionDistribution and Selling Restrictions). LMIR Trust, the Manager, the Trustee, the Financial Adviser, the Underwriters, the Sponsor and the Property Manager require persons into whose possession this Prospectus comes to inform themselves about and to observe any such restrictions at their own expense and without liability to LMIR Trust, the Manager, the Trustee, the Financial Adviser, the Underwriters, the Sponsor and the Property Manager. This Prospectus does not constitute, and the Manager, the Trustee, the Underwriters, the Sponsor and the Property Manager are not making, an offer of, or an invitation to subscribe for or purchase, any of the Units in any jurisdiction in which such offer or invitation would be unlawful. Investors are authorised to use this Prospectus solely for the purpose of considering the subscription for the Units in the Offering. Persons to whom a copy of this Prospectus has been issued shall not circulate to any other person, reproduce or otherwise distribute this Prospectus or any information herein for any purpose whatsoever nor permit or cause the same to occur. No one has taken any action that would permit a public offering to occur in any jurisdiction other than Singapore. In connection with the Offering, the Stabilising Manager (or persons acting on behalf of the Stabilising Manager) may, in consultation with the Underwriters, over-allot or effect transactions which stabilise or maintain the market price of the Units at levels that might not otherwise prevail in the open market. Such transactions may be effected on the SGX-ST and in other jurisdictions where it is permissible to do so, in each case in compliance with all applicable laws and regulations, including the Securities and Futures Act and any regulations thereunder. However, there is no assurance that the Stabilising Manager (or persons acting on behalf of the Stabilising Manager) will undertake any such stabilising actions. Such transactions may commence on or after the date of the commencement of trading of the Units on the SGX-ST and, if commenced, may be discontinued at any time and shall not be effected after the earliest of (i) the date falling 30 days from the commencement of trading of the Units on the SGX-ST, (ii) the date when the Stabilising Manager has bought on the SGX-ST, an aggregate of 96,820,000 Units, representing not more than 15.0% of the total Units offered, to undertake stabilising actions or (iii) the date falling 30 days after the date of adequate public disclosure of the final price of the Units.

ii

Forward-looking statements
Certain statements in this Prospectus constitute forward-looking statements. This Prospectus also contains forward-looking financial information in Profit Forecast and Profit Projection and other sections. Such forward-looking statements and financial information involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of LMIR Trust, the Manager, the Sponsor, the Property Manager or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements and financial information. Such forward-looking statements and financial information are based on numerous assumptions regarding the Managers present and future business strategies and the environment in which LMIR Trust, the Manager, the Sponsor or the Property Manager will operate in the future. Because these statements and financial information reflect the Managers current views concerning future events, these statements and financial information necessarily involve risks, uncertainties and assumptions. Actual future performance could differ materially from these forwardlooking statements and financial information. You should not place any undue reliance on these forwardlooking statements. Among the important factors that could cause LMIR Trusts, the Managers, the Sponsors or the Property Managers actual results, performance or achievements to differ materially from those in the forwardlooking statements and financial information are the condition of, and changes in, the domestic, regional and global economies including, but not limited to, factors such as political, economic and social conditions in Indonesia, environmental conditions, such as earthquakes and floods, and viral epidemics such as avian flu and severe acute respiratory syndrome (SARS) that may adversely affect the performance and operating results for LMIR Trusts properties or future acquisitions, changes in government laws and regulations affecting LMIR Trust, competition in the Indonesian property market, currency exchange rates, interest rates, inflation, relations with service providers, relations with lenders, the quality of tenants, hostilities (including future terrorist attacks), the performance and reputation of LMIR Trusts properties and/or future acquisitions, difficulties in identifying future acquisitions, difficulties in completing and integrating future acquisitions, changes in the Managers board of directors and executive officers, risks related to natural disasters, general volatility of the capital markets, the effects of uncertainties in the Indonesian legal system (which could limit the legal protections available to foreign investors, including with respect to the enforcement of foreign judgments in Indonesia), general risks relating to retail malls and the market price of the Units as well as other matters not yet known to the Manager or not currently considered material by the Manager. Additional factors that could cause actual results, performance or achievements to differ materially include, but are not limited to, those discussed under Risk Factors, Profit Forecast and Profit Projection, Business and Properties and Appendix FIndependent Report on the Indonesian Retail Property Market. These forward-looking statements and financial information speak only as at the date of this Prospectus. The Manager expressly disclaims any obligation or undertaking to release publicly any updates of or revisions to any forward-looking statement or financial information contained herein to reflect any change in the Managers expectations with regard thereto or any change in events, conditions or circumstances on which any such statement or information is based, subject to compliance with all applicable laws and regulations and/or the rules of the SGX-ST and/or any other relevant regulatory or supervisory body or agency.

iii

Certain defined terms and conventions

LMIR Trust will publish its financial statements in Singapore dollars. In this Prospectus, references to S$ or Singapore dollars are to the lawful currency of the Republic of Singapore, references to Rp. or Indonesian Rupiah are to the lawful currency of the Republic of Indonesia, references to MYR are to the lawful currency of Malaysia, references to A$ are to the lawful currency of Australia while references to US$ or US dollars are to the lawful currency of the United States of America. For the readers convenience, except where the exchange rate between the Indonesian Rupiah and the Singapore dollar is expressly stated otherwise, certain Indonesian Rupiah amounts in this Prospectus have been translated into Singapore dollars based on the exchange rate of Rp. 5,908.2 = S$1.00, which was the average exchange rate of Bank Indonesia for Singapore dollars on 29 June 2007. However, such translations should not be construed as representations that Indonesian Rupiah amounts have been, could have been or could be converted into Singapore dollars at that or any other rate (see Exchange Rates and Exchange Controls). Capitalised terms used in this Prospectus shall have the meanings set out in the Glossary. Unless otherwise stated, data relating to the unaudited pro forma consolidated balance sheet of LMIR Trust as at the Listing Date has been prepared on the bases set out in Appendix BIndependent Accountants Report on the Unaudited Pro Forma Consolidated Balance Sheet as at the Listing Date. LMIR Trusts unaudited pro forma consolidated balance sheet as at the Listing Date and its profit forecast and projection have been prepared in accordance with the Singapore Financial Reporting Standards. This Prospectus contains certain information with respect to the trade sectors of LMIR Trusts tenants. The Manager has determined the trade sectors in which LMIR Trusts tenants are primarily involved are based upon the Managers general understanding of the business activities conducted by such tenants in the premises occupied by them. The Managers knowledge of the business activities of LMIR Trusts tenants is necessarily limited and such tenants may conduct business activities that are in addition to, or different from, those shown herein. The forecast and projected yields and yield growth are calculated based on the Offering Price. Such yields and yield growth will vary accordingly for investors who purchase Units in the secondary market at a market price different from the Offering Price. Any discrepancies in the tables, graphs and charts included in this Prospectus between the listed amounts and totals thereof are due to rounding. Where applicable, figures and percentages are rounded to one decimal place and measurements in square metres (sq m) are converted to square feet (sq ft) and vice versa based on the conversion rate of 1 sq m = 10.7639 sq ft. A hectare (ha) is a unit of area equal to 10,000 sq m, or approximately 2.471 acres. References to Appendix or Appendices are to the appendices set out in this Prospectus. All references in this Prospectus to dates and times shall mean Singapore dates and times unless otherwise specified.

iv

Market and industry information

This Prospectus includes market and industry data and forecasts that have been obtained from internal surveys, reports and studies, where appropriate, as well as market research, publicly available information and industry publications. Industry publications, surveys and forecasts generally state that the information they contain has been obtained from sources believed to be reliable, but there can be no assurance as to the accuracy or completeness of such included information. While the Manager has taken reasonable steps to ensure that the information is extracted accurately and in its proper context, the Manager has not independently verified any of the data from third party sources or ascertained the underlying economic assumptions relied upon therein. Consequently, none of LMIR Trust, the Manager, the Trustee, the Sponsor, the Property Manager or the Underwriters makes any representation as to the accuracy or completeness of such information.

TABLE OF CONTENTS
Page Page

Summary . . . . . . . . . . . . . . . . . . . . . . . . . Risk factors . . . . . . . . . . . . . . . . . . . . . . . Use of proceeds . . . . . . . . . . . . . . . . . . . . Ownership of Units . . . . . . . . . . . . . . . . . . Distributions . . . . . . . . . . . . . . . . . . . . . . . Exchange rates and exchange controls . . Capitalisation . . . . . . . . . . . . . . . . . . . . . . Unaudited pro forma consolidated balance sheet as at the Listing Date . . . Profit forecast and profit projection . . . . . . Strategy . . . . . . . . . . . . . . . . . . . . . . . . . . Business and properties . . . . . . . . . . . . . . The Manager and corporate governance . . . . . . . . . . . . . . . . . . . . . . The Sponsor. . . . . . . . . . . . . . . . . . . . . . . The formation and structure of LMIR Trust . . . . . . . . . . . . . . . . . . . . . . . . . . . Certain agreements relating to LMIR Trust and the Properties . . . . . . . . . . . . Overview of relevant laws and regulations in Indonesia . . . . . . . . . . . . . . . . . . . . . Taxation . . . . . . . . . . . . . . . . . . . . . . . . . . Plan of distribution . . . . . . . . . . . . . . . . . . Clearance and settlement. . . . . . . . . . . . .

1 65 88 89 91 93 95 96 98 112 118 188 208 214 223 241 249 255 265

Experts . . . . . . . . . . . . . . . . . . . . . . . . . General information . . . . . . . . . . . . . . . . Glossary . . . . . . . . . . . . . . . . . . . . . . . . . Appendix AIndependent accountants report on the profit forecast and profit projection . . . . . . . . . . . . . . . . . . . . . . Appendix BIndependent accountants report on the unaudited pro forma consolidated balance sheet as at the listing date . . . . . . . . . . . . . . . . . . . . . Appendix CIndependent Singapore taxation report . . . . . . . . . . . . . . . . . . Appendix DIndependent Indonesian taxation report . . . . . . . . . . . . . . . . . . Appendix EIndependent property valuation summary reports . . . . . . . . . Appendix FIndependent report on the Indonesian retail property market . . . . Appendix GTerms, conditions and procedures for application for and acceptance of the units in Singapore. . Appendix HList of present and past principal directorships of directors and executive officers . . . . . . . . . . . . . . . .

. . .

266 267 271

A-1

. . . . .

B-1 C-1 D-1 E-1 F-1

G-1

H-1

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Summary
The following summary is qualified in its entirety by, and is subject to, the more detailed information contained or referred to elsewhere in this Prospectus. Investing in the Units involves risks. Investors should read this Prospectus in its entirety and, in particular, the sections from which the information in this summary is extracted and Risk Factors. The meanings of terms not defined in this summary can be found in the Glossary or in the Trust Deed (as defined herein). A copy of the Trust Deed can be inspected at the registered office of the Manager, which is located at 78 Shenton Way, #05-01 Lippo Centre, Singapore 079120. Statements contained in this summary that are not historical facts may be forward-looking statements. Such statements are based on certain assumptions and are subject to certain risks, uncertainties and assumptions which could cause actual results to differ materially from those forecast or projected (see Forward-Looking Statements). Under no circumstances should the inclusion of such information herein be regarded as a representation, warranty or prediction with respect to the accuracy of the underlying assumptions by the Manager, the Trustee, the Underwriters, the Sponsor, the Property Manager or any other person or that these results would be achieved or are likely to be achieved. OVERVIEW OF LMIR TRUSTTHE FIRST INDONESIAN RETAIL REIT OFFERING IN SINGAPORE LMIR Trust is a Singapore-based real estate investment trust (REIT) constituted by a trust deed dated 8 August 2007 (as amended by a first supplemental deed dated 18 October 2007) entered into between the Trustee and the Manager (the Trust Deed). It is established with the principal investment objective of owning and investing on a long-term basis in a diversified portfolio of income-producing real estate in Indonesia that are primarily used for retail and/or retail-related purposes, and real estate related assets in connection with the foregoing purposes. Indonesias real GDP growth has gathered pace, rising from 3.8% in 2001 to 5.5% in 2006 and is forecast to grow by 6.0% in 2007 and 6.1% in 2008. Interest rates and inflation are expected to fall when measures taken by the Indonesian government to improve the business environment and encourage investments begin to take effect. Spurred by the economic development in Indonesia, the share of population within the middle income group has grown steadily from 50.0% in 2001 to 64.0% in 2006. It is estimated that the urban middle income population in Indonesia totals approximately 66 million people. (See Appendix F Independent Report on the Indonesian Retail Property Market.) As at Listing Date, LMIR Trusts property portfolio will comprise seven retail mall properties (the Retail Malls) and seven retail spaces located within other retail malls (the Retail Spaces, and collectively with the Retail Malls, the Properties), all of which are located in Indonesia. (See Information on the Properties.) It is intended that LMIR Trusts investments will be made on a long-term basis. The Properties are strategically located in major cities of Indonesia with large population catchment areas and are accessible via major transportation routes and highways. Three of the Retail Malls are located in Jakarta, two in Greater Jakarta (an area encapsulated by Jakarta, Bogor, Depok, Tangerang and Bekasi) and the remaining two in Bandung, the fourth largest populated city in Indonesia. The Retail Malls are popular in their respective population catchment areas. The Retail Malls are supported by their diverse trade mix and strategic locations, and provide shoppers with comprehensive one-stop shopping, dining and entertainment destinations. As at 30 June 2007, the Retail Malls had an aggregate Net Lettable Area (NLA) of 219,382 sq m, and a weighted average occupancy rate of 91.6% based on Committed Leases. The tenant profile of the Retail Malls includes leading domestic retailers such as Matahari and Rimo Department Stores, Hero Supermarket and Foodmart supermarket (formerly known as Matahari Supermarket) and Hypermart, which are well-complemented by international specialty tenants such as Fitness First, Starbucks, McDonalds, Kentucky Fried Chicken and Pizza Hut as well as other domestic tenants. The Retail Spaces, which have a total NLA of approximately 94,070 sq m as at 30 June 2007, are predominantly utilised as department stores, supermarkets, hypermarkets and/or amusement centres and are housed within other retail malls. Three of the Retail Spaces are located in Greater Jakarta and the remaining four in the cities of Semarang, Madiun, Malang and Medan. As at Listing Date, each of the Retail Spaces will be leased to PT. Matahari Putra Prima Tbk (Matahari or the Master Lessee) under master lease agreements (the Master Lease Agreements), for an initial term of 10 years, with an option granted to Matahari to renew for another 10 years. The Master Lease Agreements contain provisions for increase in rental revenues through step-ups in the base rent of 8.0% per annum commencing from 1 January 2008 and ending on 31 December 2011 and thereafter, a fixed percentage of 4.25% over the increase in the
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Master Lessees net revenue. (See Certain Agreements Relating to LMIR Trust and the Properties Description of the Master Lease AgreementsLease Rental.) Each of the Properties will be wholly-owned by LMIR Trust through special purpose companies (SPCs) (see Structure of LMIR Trust). Key investment highlights The Manager believes that an investment in LMIR Trust offers the following attractions to Unitholders: LMIR Trust is the first Indonesian retail REIT offering in Singapore LMIR Trust will be the first REIT in Singapore to provide exposure to Indonesias growing retail sector. The Retail Malls are anchored by leading Indonesia retailers and well-complemented by international and domestic specialty tenants, providing shoppers and their families with a wide offering of products. As at the Listing Date, the Retail Spaces will be leased to Matahari, Indonesias largest retailer by sales revenue, for an initial term of 10 years with annual rental step-ups. The Retail Malls and Retail Spaces are strategically located within large population catchments supported by neighbouring residential precincts, offices, schools and industrial estates. Exposure to the growing Indonesia retail sector, in particular the major cities of Jakarta, Bandung, Semarang and Medan According to PT Jones Lang LaSalle (the Independent Indonesian Retail Property Consultant), real GDP growth in Indonesia has gathered pace, rising from 3.8% in 2001 to 5.5% in 2006 and is forecast to grow by 6.0% in 2007 and 6.1% in 2008. Average growth rate from 2007 to 2011 is forecast at 5.7%. Interest rates and inflation are expected to fall when measures taken by the Indonesian government to improve the business environment and encourage investments begin to take effect. On 26 April 2007, the Indonesian government enacted Law No. 25 of 2007 on Investment (the New Investment Law) which revokes the previous Foreign and Domestic Investment law. The New Investment Law provides and supports, among others, investment incentives and more open investments in Indonesia. These will include granting longer periods for property ownership and land use rights. The New Investment Law further simplifies the investment procedures and certain other arrangements which the Indonesian government believes will provide Indonesia with more competitive advantages that will act as incentives to attract increased levels of long-term foreign investment to Indonesia. Economic growth in the past few years and the growth of the middle class have contributed to a consistent growth in retail sales. The retail sector was the first sector to recover from the economic crisis which hit Indonesia in 1998, with retail trade increasing by over 60.0% in 1999. The rapid recovery was driven predominantly by strong domestic consumption, which also served as a primary driver of Indonesias recovery and economic growth. Nominal retail sales growth has averaged 11.0% per annum since 1999 with the growth rate forecast to continue from 2007 to 2011. Apart from the favourable macroeconomic conditions, retail sales have also been boosted by a lifestyle shift towards a higher level of consumerism, in particular, among the urban middle income group centered in the major Indonesian cities such as Jakarta, Bandung, Semarang and Medan. (See Appendix FIndependent Report on the Indonesian Retail Property Market.) Strong acquisition growth potential supported by robust acquisition pipeline from the Sponsor and acquisitions from third parties The Sponsor has granted LMIR Trust, for so long as: (i) Lippo-Mapletree Indonesia Retail Trust Management Ltd. remains the manager of LMIR Trust; and

(ii) the Sponsor and/or any of its related corporations, alone or in aggregate, remains a controlling shareholder of the Manager;
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a right of first refusal (the ROFR) over any retail properties located in Indonesia (each such property referred to as a Relevant Asset): (a) which the Sponsor or any of its subsidiaries (each a Sponsor Entity) proposes to sell or transfer (whether such Relevant Asset is wholly-owned or partly-owned by the Sponsor Entity and excluding any sale of such Relevant Asset by a Sponsor Entity to any related corporation of such Sponsor Entity pursuant to a reconstruction, amalgamation, restructuring, merger or any analogous event) to an unrelated third party; or (b) for which a proposed offer for sale or transfer of such Relevant Asset has been made to a Sponsor Entity. (See Certain Agreements Relating to LMIR Trust and the PropertiesDescription of the Right of First Refusal Agreement.) As at Listing Date, the scope of the ROFR encompasses five properties currently under development by the Sponsor and/or its subsidiaries, as set out in the table below (the ROFR Properties):
ROFR Properties under development Expected date of completion Estimated Gross Floor Area (GFA) (sq m) Estimated NLA (sq m)

Location

Binjai Supermall . . . Pejaten Mall . . . . . . Kuta Beach Mall . . . Kemang City Mall . . Puri Paragon City .

.. .. .. .. ..

.. .. .. .. ..

. . . . .

. . North Sumatra . . South Jakarta . . Kuta, Bali . . South Jakarta . . West Jakarta

Fourth quarter of 2007 Second quarter of 2008 Second half of 2008 First half of 2009 Second half of 2009

23,615 57,948 41,562 77,555 196,400 397,080

18,300 40,327 30,735 56,052 127,660 273,074

The ROFR Properties are expected to have an aggregate GFA of approximately 397,080 sq m, and an aggregate NLA of approximately 273,074 sq m. If LMIR Trust acquires all the ROFR Properties, the aggregate NLA of LMIR Trusts initial property portfolio will increase by over 270,000 sq m, and will represent an increase of approximately 87.4% of the aggregate NLA of LMIR Trusts initial property portfolio as at 30 June 2007. The Manager believes that the ROFR granted to LMIR Trust provides a visible pipeline of future acquisitions and will greatly enhance LMIR Trusts growth profile and presence in the Indonesian retail market given the estimated size and quality of the ROFR Properties. In addition to the above ROFR Properties, the Sponsor, the largest listed property developer in Indonesia by market capitalisation and a leading retail mall developer in Indonesia, is expected to continue developing retail mall properties across Indonesia. These potential developments further enhance the acquisition pipeline for LMIR Trust. The Manager may also acquire retail malls located in Indonesia from third party owners that are not related to the Sponsor and which satisfy LMIR Trusts investment criteria and strategy. Ownership of retail malls in Indonesia is highly dispersed and fragmented. This provides LMIR Trust with significant opportunities for such acquisitions. As at the Latest Practicable Date, the Manager has entered into a non-binding memorandum of understanding with: (i) (ii) (iii) PT. Multi Pratama Gemilang Perkasa (Pikko Group) in respect of the potential acquisition by LMIR Trust of Cosmopolitan Mall Pluit, a retail mall located in North Jakarta; Zellwager Enterprise Limited in respect of the potential acquisition by LMIR Trust of Sun Plaza, a retail mall located in Medan, North Sumatra; and PT. Pakuwon Permai in respect of the potential acquisition by LMIR Trust of Supermal Pakuwon Indah and Pakuwon Trade Center, a retail mall located in West Surabaya, East Java.

The Manager understands that Cosmopolitan Mall Pluit is currently undergoing asset enhancement works, with such works scheduled for completion in the second half of 2008. The acquisition of Cosmopolitan Mall Pluit is likely to take place by the second half of 2008.

Identified property

Location

Estimated GFA (sq m)

Estimated NLA (sq m)

Estimated date of acquisition by LMIR Trust

Cosmopolitan Mall Pluit . . . Sun Plaza . . . . . . . . . . . . . Supermal Pakuwon Indah and Pakuwon Trade Center . . . . . . . . . . . . . . . .

North Jakarta North Sumatra

131,013 73,871

88,040 61,348

Second half of 2008 Within six months after the Listing Date

West Surabaya, East Java

289,563 494,447

114,834 264,222

Within six months after the Listing Date

(See Certain Agreements relating to LMIR Trust and the PropertiesDescription of Non-Binding Memorandum of Understanding.) Potential for growth through active asset management and tenant re-mixing The Manager intends to undertake active asset management to maximise the value and performance of the Properties. (See Business and PropertiesAsset Enhancement.) As at the Latest Practicable Date, three of the Retail Malls, Bandung Indah Plaza, Mal Lippo Cikarang and Ekalokasari Plaza have recently completed extensive asset enhancement works and a fourth Retail Mall, The Plaza Semanggi is currently undergoing asset enhancement works. - Bandung Indah Plaza has recently completed enhancement and renewal works which created an additional NLA of approximately 3,843 sq m. - Mal Lippo Cikarang has recently completed the building of an extension which has increased the NLA of the malls hypermarket and specialty space by 10,694 sq m. As at 30 June 2007, 8,539 sq m or approximately 79.8% of the additional NLA created from such asset enhancement has been precommitted to Hypermart, one of Indonesias leading hypermarket chains. - Ekalokasari Plaza has recently completed asset enhancement works which created an additional NLA of 5,013 sq m by adding a third floor and a mezzanine floor. This development incorporates a food court, a proposed fitness centre and potentially a cinema as anchor tenants for the top levels of the centre. These asset enhancement works are expected to improve shopper traffic throughout all levels of the mall. As at 30 June 2007, 670 sq m or approximately 13.4% of the additional NLA created from such asset enhancement has been pre-committed. - The Plaza Semanggi is undergoing asset enhancement works to include a new alfresco caf area called the Plangi on the Sky caf, which will increase NLA by approximately 3,000 sq m by the end of 2007. Each of Bandung Indah Plaza, Mal Lippo Cikarang and Ekalokasari Plaza has either obtained, or is in the process of obtaining, final local government approval for the recently completed asset enhancement works which have created additional NLA. The completion of these asset enhancement works are expected to enhance the positioning and branding of the Retail Malls within their respective trade areas and increase shopper traffic. Further, the Manager has also identified several asset enhancement opportunities at some of the Retail Malls through reconfiguration of retail unit layouts, improvement of tenancy mix in conjunction with the repositioning and re-branding of such malls, conversion of ancillary areas into productive retail space and the implementation of other proactive asset management initiatives such as identifying the latest retail trends and offerings. Lippo Strategic has entered into a rental guarantee deed (Rental Guarantee Deed) with the relevant Retail Mall Singapore SPCs pursuant to which Lippo Strategic will (i) provide a rental guarantee to the relevant Retail Mall Singapore SPC in respect of existing units and new units in the respective Retail Malls which are untenanted and (ii) undertake to pay to the relevant Retail Mall Singapore SPC any shortfall in the maintenance and operation costs which the relevant Operating Company has undertaken to bear under the respective Operating Costs Agreement. (See Certain Agreements Relating to LMIR Trust and the PropertiesDescription of the Rental Guarantee Deeds.)
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 The management of all the Retail Malls will be undertaken by the Property Manager, a wholly-owned subsidiary of the Sponsor. The Property Manager will adopt international best practices for all the Retail Malls in order to realise branding, leasing, marketing and operating efficiencies. Being the sole property manager of all of the Retail Malls, the Property Manager will enjoy economies of scale and synergistic benefits, including increased buying power, a stronger corporate image, improved retailer relationships, and a transfer of knowledge to create additional value. The sponsor of LMIR Trust is PT. Lippo Karawaci Tbk, Indonesias largest listed property company by market capitalisation The Sponsor is an internationally recognised corporation and is the largest listed property company in Indonesia by market capitalisation. It had a market capitalisation of Rp. 10,609.2 billion (approximately S$1.8 billion) based on the closing price of its shares of Rp. 1,790.0 on the Jakarta Stock Exchange (JSX) as at 18 October 2007. Its property portfolio comprises townships and residential developments and commercial and retail development properties. The Sponsor has a recognised track record and dominant position within the retail and retail property industry in Indonesia. Its employees have in-depth property management and operating experience, including extensive experience in owning, managing, leasing, marketing and developing retail properties. As at 30 June 2007, the Sponsor has completed eight retail development projects in Indonesia with a total estimated GFA of 581,740 sq m and has six retail development projects with a total estimated GFA of approximately 483,060 sq m under development. The Property Manager, being wholly-owned by the Sponsor, will be able to leverage the Sponsors extensive experience in property management to enhance the value of the Retail Malls. (See The Sponsor.) In addition, the Sponsor has the ability to identify and enhance under-valued retail properties and leverage its extensive retail network in Indonesia. This is reflected by the Sponsors redevelopment of Bandung Indah Plaza. Prior to the Property Manager being appointed as the property manager of Bandung Indah Plaza, the mall had an average monthly Specialty Base Rent of approximately Rp. 74,203 per sq m as at 1 January 2005. Subsequent to the Property Managers appointment as the property manager, the average monthly Specialty Base Rent increased by approximately 304.3% to approximately Rp. 300,000 per sq m as at 30 April 2007. The interests of Lippo Strategic, an affiliate of the Sponsor, are substantially aligned with those of the Unitholders Lippo Strategic, an affiliate of the Sponsor, will hold a strategic interest in LMIR Trust by subscribing for 287,695,000 Cornerstone Units representing 27.1% of the total issued Units of LMIR Trust as at the Listing Date, assuming that the Over-allotment Option is not exercised. The interests of Lippo Strategic and the Sponsor, through this affiliation with Lippo Strategic, will be substantially aligned with those of Unitholders. As a substantial Unitholder, the Mapletree Groups interests are substantially aligned with those of the Unitholders Mapletree LM, a wholly-owned subsidiary of Mapletree Investments Pte Ltd (MIPL), will be subscribing for 127,250,000 Units, representing 12.0% of the total issued Units of LMIR Trust as at the Listing Date. MIPL is a leading Asia-focused real estate company based in Singapore. MIPL and its subsidiaries (the Mapletree Group), have an asset base of approximately S$4.5 billion (as at 30 June 2007) comprising office, logistics, industrial, residential and retail/lifestyle properties. Because of the Mapletree Groups ownership of Units in LMIR Trust, its interests will be substantially aligned with those of Unitholders. Locked-in master leases with rental step-ups for the Retail Spaces As at Listing Date, each of the Retail Spaces will be leased by the relevant Retail Space Indonesian SPC to the Master Lessee, pursuant to the terms of the relevant Master Lease Agreement. The term of each of the Master Lease Agreements is 10 years from the Listing Date, with an option for the Master Lessee to renew for a further term of 10 years.
5

 Under each of the Master Lease Agreements, the relevant Retail Space Indonesian SPC will be entitled to receive from the Master Lessee rental payments comprising: - A fixed base rent amount for the period commencing from Listing Date to 31 December 2007. - An annual increment of 8.0% over the lease rental payable for the immediately preceding financial year for each of FY2008 to FY2011. - For each of FY2012 to FY2016, an amount equivalent to the lease rental payable in respect of FY2011 and 4.25% of the amount by which the net revenue of the Master Lessee derived from the Retail Spaces for the immediately preceding financial year exceeds the net revenue of the Master Lessee derived from the Retail Spaces for FY2010. The Master Lessees operations in each of the individual Retail Spaces will be audited annually by an international accounting firm. The Manager believes that the structure of the Master Lease Agreements provides LMIR Trust with stable and growing rental income from the Retail Spaces. Stable and growing distributions for LMIR Trust LMIR Trusts distribution policy is to distribute 100.0% of its tax-exempt income (after deduction of applicable expenses) and capital receipts for the period from the Listing Date to 31 December 2007, the year ending 31 December 2008 (Projection Year 2008) and the year ending 31 December 2009 (Projection Year 2009) and at least 90.0% of its tax-exempt income (after deduction of applicable expenses) and capital receipts thereafter. The tax-exempt income comprises dividends received from the Target Singapore SPCs (see Structure of LMIR Trust). The income of the Target Singapore SPCs is derived mainly from interest income earned and dividends from the Indonesian SPCs. Capital receipts comprise amounts received by LMIR Trust from the redemption of its investment in the redeemable preference shares in the Target Singapore SPCs. The actual proportion of tax-exempt income and capital receipts distributed to Unitholders may be greater than 90.0% if the Manager considers this to be appropriate, having regard to LMIR Trusts funding requirements, other capital management considerations, and the need to ensure the overall stability of distributions. Distributions will be paid on a quarterly basis for the three-month periods ending on 31 March, 30 June, 30 September and 31 December each year. LMIR Trusts first distribution after the Listing Date will be for the period from the Listing Date to 31 March 2008 and will be paid by the Manager on or before 30 May 2008. Subsequent distributions will be made on a quarterly basis (see Distributions). The table below sets out the percentage of forecast Gross Rent attributable to Committed Leases for (i) the period from 1 July 2007 to 31 December 2007 (Forecast Period 2007), (ii) the Projection Year 2008, and (iii) the Projection Year 2009.
Percentage of forecast and projected Gross Rent attributable to Committed Leases

Forecast Period 2007 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Projection Year 2008 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Projection Year 2009 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

91.3% 80.9% 66.8%

The table below sets out the Managers forecast and projected distribution yields for the time periods indicated, which are based on the assumption that LMIR Trust distributes 100.0% of its tax-exempt income (after deduction of applicable expenses) and capital receipts.
Distribution yield Based on the Offering Price (%)

Forecast Period 2007(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Projection Year 2008 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Projection Year 2009 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Note: (1) Annualised figures for Forecast Period 2007.

6.9 7.3 7.8

Such yields will vary accordingly for investors who purchase the Units in the secondary market at a market price different from the Offering Price. The profit forecast and profit projections from which this
6

information was extracted are based on various assumptions set out in Profit Forecast and Profit Projection. There can be no assurance that the profit forecast and profit projection will be met. The actual yields per Unit may be materially different from the forecast and projected yields (see Risk Factors). Hedging strategies to minimise exposure arising from interest rates and currency fluctuations The value of the Indonesian Rupiah has been subject to fluctuations in the past and may be subject to fluctuation in the future. The Manager has a policy to undertake foreign exchange hedging of the expected distributions of LMIR Trust to insulate against movements in exchange rates (whether favourable or unfavourable). The Trustee, as trustee of LMIR Trust, has entered into foreign exchange hedges equivalent to 100.0% of LMIR Trusts estimated distributions for a total term of five years, effective as of the Listing Date, and thereafter it intends to continuously hedge on a rolling basis so as to provide a degree of certainty to Unitholders that changes in the exchange rate between the Indonesian Rupiah and the Singapore dollar will not have a significant impact on the distributions in Singapore to Unitholders. Management fees structured to incentivise and align interests of the Manager with those of Unitholders The management fees payable to the Manager have a performance-based element which is designed to align the interests of the Manager with those of the Unitholders, and incentivise the Manager to grow revenues and minimise operating costs. The receipt of Units by the Manager in lieu of the performance fee further aligns the Managers interest with the Unitholders. (See Structure of LMIR TrustCertain Fees and Charges and The Manager and Corporate GovernanceManagement Fees.) Optimal capital structure LMIR Trust will not incur any borrowings as at the Listing Date. As a REIT is generally permitted to borrow up to 35.0% of the value of its Deposited Property (or up to a maximum of 60.0% if a credit rating from Fitch Inc., Moodys Investors Services, Inc. (Moodys) or Standard & Poors Ratings Group, a division of the McGraw-Hill Companies, Inc. (Standard & Poors) is obtained and disclosed to the public), LMIR Trust will have substantial ability to incur indebtedness to fund future acquisitions and asset enhancement initiatives. To the extent that LMIR Trust incurs borrowings after the Listing Date, the Manager aims to optimise LMIR Trusts capital structure and cost of capital by employing a mix of equity and debt funding alternatives within the aggregate leverage1 (Aggregate Leverage) limit set out in the Property Funds Guidelines. By the Listing Date, LMIR Trust expects to put in place a floating rate secured term loan facility of up to S$350.0 million (Debt Facilities). (See StrategyCapital and Risk Management Strategy.) Tax exemptions in Singapore Dividends and interest received in Singapore from the Indonesian SPCs will be exempt from Singapore income tax under Sections 13(8) and 13(12), respectively, of the Income Tax Act, Chapter 134 of Singapore (the Income Tax Act). Distributions made by LMIR Trust out of such income, received through the Target Singapore SPCs in the form of one-tier (tax-exempt) dividends, will be exempt from Singapore income tax in the hands of all Unitholders. No tax will be deducted at source from such distributions. Distributions made out of capital receipts comprising amounts received by LMIR Trust from redemption of redeemable preference shares in the Target Singapore SPCs will be treated as a return of capital for Singapore income tax purposes and will not be taxed in the hands of all Unitholders. For Unitholders who hold the Units as trading or business assets and are liable to Singapore income tax on gains arising from disposal of the Units, the amount of this portion of the distribution will be applied to reduce the cost of the
1

According to the Property Funds Guidelines, this means total borrowings and deferred payments (including deferred payments for assets whether to be settled in cash or in units of the relevant property fund).
7

Units for the purpose of calculating the amount of taxable trading gain when the Units are disposed of. If the amount exceeds the cost or the reduced cost of the Units, as the case may be, the excess will be subject to tax as trading income of such Unitholders. The granting of tax exemption on, among others, foreign-sourced interest income under Section 13(12) of the Income Tax Act is part of a package of tax changes introduced by the Singapore government to develop Singapore as the preferred Asian listing destination for Asian REITs. No capital expenditure requirements with respect to the Retail Spaces in the first 30 months after the Listing Date Under each of the Master Lease Agreements, the Master Lessee is responsible for all land and building tax and expenses for property repairs, maintenance and management, all operating expenses and utilities for the duration of the lease term and shall indemnify and keep the relevant landlord indemnified from the same. During the first 30 months of the lease term, the Master Lessee shall be responsible for all repair and replacement works for the mechanical and electrical equipment, whether or not of a capital nature. After the first 30 months of the lease term, (a) the Master Lessee shall continue to be responsible for all repair and replacement works for the mechanical and electrical equipment, which are not of a capital nature, and (b) each relevant landlord shall be responsible for any repair and replacement works in relation to the mechanical and electrical equipment which are of a capital nature as well as replacement works which are reasonably required by the Master Lessee in connection with changes to the layout of the Retail Spaces. Competent and experienced personnel The board of directors of the Manager comprise individuals who collectively have extensive experience in areas including, but not limited to, law, accounting, banking, finance, real estate and fund management. The Manager believes that the Unitholders will benefit from the experience of key staff members of the Manager in fund, asset and property management in the retail property market. LMIR Trust intends to leverage such relevant experience and expertise to implement its planned strategies (see The Manager and Corporate Governance). Competitive strengths The Manager believes that the competitive strengths of the Properties include: The Properties are located in major cities of Indonesia amidst a growing and affluent urban middle class The Properties are mainly located within Greater Jakarta and Bandung, Indonesias fourth most populous city. Jakarta, Indonesias capital and largest city, has seen its total household expenditure increase by an average of 12.8% per annum from 2001 to 2006, rising from Rp. 19,277 billion in 2001 to Rp. 35,273 billion in 2006. Bandung has seen a similar growth in its total household expenditure, rising from Rp. 4,825 billion in 2001 to Rp. 8,317 billion in 2006, an average growth of 11.5% per annum from 2001 to 2006. Economic development in Indonesia has seen a significant growth of the middle class over the past five years. This middle income group is considered one of the vital contributors to the economy and is perceived as the most prospective target in mass consumer markets. Based on the Social Economic Survey (SES) by ACNielsen1 conducted in nine major cities in Indonesia, the share of population of the middle income group (classified as SES A, B & C) has steadily grown from 50.0% in 2001 to 64.0% in
1

Source: ACNielsen Social Economic Survey. ACNielsen has not provided its consent, for the purposes of section 249 (read with section 302) of the SFA, to the inclusion of the information extracted from the relevant report issued by it, and is thereby not liable for such information under sections 253 and 254 (read with section 302) of the SFA. While the Manager has taken reasonable action to ensure that the information has been reproduced in its proper form and context, and that it has been extracted accurately and fairly, neither the Manager nor any other party has conducted an independent review of, nor verified the accuracy of, such information.

2006. It is estimated that the urban middle income population in Indonesia totals approximately 66 million people. This particular group is likely to be considered a major target market for modern retail shopping centres. Retail spending in these cities has been further boosted by a shift in lifestyle towards a higher level of consumerism, partially brought about by the introduction of foreign brands and designer labels. These foreign brands and designer labels typically have higher margins and are willing to pay higher rentals for prime and sizeable retail space. The proliferation of hypermarkets and supermarkets over traditional markets has also increased shopper traffic to modern retail malls. In addition, the geographic diversification of the Properties reduces LMIR Trusts dependence on any single regional market and, accordingly, contributes to the stability of LMIR Trusts future income. (See Appendix FIndependent Report on the Indonesian Retail Property Market.) Gross Regional Domestic Product (GRDP) Per Capita by Indonesian City (Current Prices), 2003-2005*
60 50 40

2003 2004 2005

Rp Millions

30 20 10 0
Indonesia Jakarta Bandung Surabaya Semarang Medan

City
* Figures for Indonesia, Jakarta & Bandung are for 2003-2005 2005 figures for Surabaya, Semarang and Medan are not available

Source: Appendix FIndependent Report on the Indonesian Retail Property Market Socio-Economic Survey in Indonesia(1), 2001-2006
100% 90% 80% 70%
Monthly household expenditure A (Above Rp. 2 mil/month) B (Rp. 1.5-2 mil/month) C1 (Rp. 1.0-1.5 mil/month)

Percentage

60% 50% 40% 30% 20% 10% 0% 2001 2002 2003 2004 2005 2006

C2 (Rp. 0.7-1.5 mil/month) D (Rp. 0.5-0.7 mil/month) E (Below Rp. 0.5 mil/month)

Note: (1) AC Nielsen Socio-Economic Survey is based on monthly household expenditure, not actual income. No standard can be used (or widely accepted) to calculate direct relation between expenditure and income. Source: Appendix FIndependent Report on the Indonesian Retail Property Market
9

Total household expenditure of the middle class (Rp. billions) Cities 2001 2006

Average annual growth 2001-2006 (%)

Jakarta. . . . Bodetabek . Bandung . . Surabaya . . Semarang . Medan . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

10,561 7,493 2,793 4,295 1,758 3,542

17,276 25,817 4,304 6,293 3,691 5,103

10 28 9 8 16 8

Source: Appendix FIndependent Report on the Indonesian Retail Property Market High growth potential from favourable demographics of the Indonesian population According to the Independent Indonesian Retail Property Consultant, the Indonesian retail market has high growth potential, with 50.0% of Indonesias estimated population of 222 million in 2006 under the age of 25. Based on the Independent Report on the Indonesian Retail Property Market, the share of population of the middle income group has steadily grown from 50.0% in 2001 to 64.0% in 2006. It is estimated that the urban middle income population in Indonesia totals approximately 66 million people. (See Appendix FIndependent Report on the Indonesian Retail Property Market.) Retail Malls strategically located within well-established population catchment areas The Retail Malls are strategically located throughout Greater Jakarta with a population range of between approximately 0.4 million and 2.2 million within their respective primary catchment areas. Located in middle to upper income demographic regions, each of the Retail Malls has a variety of strong characteristics such as: - Gajah Mada PlazaThe only shopping centre located in the Chinatown district of Jakarta with a hypermarket, executive club and a swimming pool; - Cibubur JunctionLocated in the heart of Cibubur, one of the most affluent and upmarket residential areas in Jakarta; - The Plaza SemanggiLocated in the golden triangle of the Jakarta central business district (CBD) and accessible from all four directions of the capital city; - Mal Lippo CikarangGrowing residential and industrial Lippo township; - Ekalokasari PlazaA five-minute drive from the Bogor exit gate of the Jagorawi toll road, the highway which connects Jakarta to Bogor; - Bandung Indah PlazaStrategic location at the heart of Bandung and easily accessible to the greater Bandung population; and - Istana PlazaEasily accessible from several transportation hubs in the vicinity, such as the Husein Sastranegara Airport, Bandung train station and Pasteur tollgate. The Retail Malls located within Greater Jakarta, such as Gajah Mada Plaza and The Plaza Semanggi, also enjoy high levels of connectivity via public transportation such as the Transjakarta busway which is a premium form of public transportation in Jakarta, thereby enhancing the ability of these Retail Malls to draw high volumes of shoppers. Quality Retail Malls which cater to the daily needs of shoppers The Retail Malls are strategically positioned as one-stop shopping destinations for shoppers and their families, catering to their daily as well as lifestyle and entertainment needs. The Retail Malls are anchored by supermarkets, hypermarkets or department stores, which draw significant shopper traffic to the malls and provide a comfortable, hassle-free and low-cost environment for shoppers to purchase their daily necessities. The specialty, food and beverage and lifestyle and entertainment tenants, which include foreign labels and brands, restaurants, cinemas and entertainment centres provide shoppers with a wide product offering and a complete shopping experience.
10

Further, the Retail Malls are managed by competent professionals with retail expertise and experience, as reflected in the high occupancy rates and the ability of each Retail Mall to differentiate itself from its competitors within its catchment area. As at 30 June 2007, the Retail Malls had a weighted average occupancy of approximately 91.6%, reflecting the robust demand for space in the Retail Malls. Retail Spaces strategically located within well-established population catchment areas The Retail Spaces are strategically located throughout Greater Jakarta and in the major cities of Semarang, Medan, Madiun and Malang. For example, the Mall WTC Matahari Units are located in Serpong which is part of Tangerang, one of the settlement areas on the outskirts of Jakarta. Mall WTC Matahari is strategically located along a main road which connects to Bumi Serpong Damai City (BSD City), the largest residential estate in Greater Jakarta. It has a proposed development area of 6,000 ha with currently 1,500 ha developed and is occupied by over 15,000 households. In recent years, BSD City has experienced rapid growth in terms of the number of housing units and retail shop houses which have been built. Another example is the Malang Town Square Units which are located in the city of Malang in the East Java province. Malang is the second largest city in East Java province with a population of approximately 0.8 million and a regency population of approximately 2.4 million people. The region is a popular tourist destination due to its natural attractions (for example, Mount Bromo, one of Javas largest volcanoes), cool climate and colonial history. Malang also has a large student population, being home to five universities (Brawijaya, State, Muhammadiyah, Widya Gama and Merdeka Universities). Economies of scale through portfolio management of the Retail Malls The Property Manager, a wholly-owned subsidiary of the Sponsor, will manage the Retail Malls after the Listing Date. As the Retail Spaces are master-leased to Matahari, there is no property manager appointed for the Retail Spaces. The Property Manager believes that there are opportunities to realise efficiencies and economies of scale so as to maximise the performance of each Retail Mall. The Property Manager comprises a specialised team of professionals managing the key areas of operations, leasing, marketing and finance. Best practices are standardised and strictly adhered to across all assets under its portfolio. The Retail Malls will be able to leverage upon the Property Managers and the Sponsors experience in areas including contractor management, retailer relationships and key negotiations, cost control mechanisms and strategic leasing, marketing and management initiatives. Quality tenant base The Retail Malls benefit from the quality of their tenants. The Retail Malls top tenants include wellknown international and domestic retailers and brand names such as Giant Hypermarket, Gramedia bookstore, Starbucks, Giordano, Fitness First, Sports Station, Matahari Department Store, Hypermart and Studio 21 Cinema. The Manager is of the view that the Retail Malls rental values are predominantly at or below market levels. This will allow the Manager to capture growth on lease expiries while maximising the retail mix of these malls. The Retail Malls have a large combined tenant base of over 1,400 tenants (as at 30 June 2007). These tenants represent a wide variety of mass retailers and specialty stores and provide trade and product diversification for the Retail Malls. Advance rental payment structure helps to minimise cash flow volatility due to potential rental arrears Retail tenants in Indonesia typically pay an advance rental of approximately 10% to 20% of the total rent payable for the duration of the lease upon signing of the lease agreement. This advance rental payment helps to minimise LMIR Trusts cash flow volatility due to potential rental arrears, thus enhancing LMIR Trusts cash flow stability. (See Business and Properties.)
11

Valuation As at 30 June 2007, the Properties were valued at an aggregate of S$1,004.7 million by Knight Frank / PT. Willson Properti Advisindo, as the Independent Valuer to the Manager (Knight Frank) and at S$1,016.3 million by Colliers International / PT Penilai, as the Independent Valuer to the Trustee (Colliers). The Manager has adopted Knight Franks valuation as the basis for the determination of the fair market value of the Properties and the net asset value (NAV) per Unit. (See Unaudited Pro Forma Consolidated Balance Sheet as at the Listing Date.) The following table sets forth the key statistics relating to the valuation of the Properties and the Offering: Appraised value by Knight Frank as at 30 June 2007 . . . . . . . . . . . . . . . . . . . . . . . Appraised value by Colliers as at 30 June 2007 . . . . . . . . . . . . . . . . . . . . . . . . . . . Implied NAV per Unit based on valuation by Knight Frank at the Offering Price . . . . S$1,004.7 million S$1,016.3 million S$0.91

At the Offering Price, the Units under the Offering and the Cornerstone Units will be issued at a 12.1% discount to the NAV.

12

Key Information on the Properties

A summary of key information on the Properties is set out below:

Retail Mall

Location

Net property income (NPI) for Forecast Period 2007 (S$000) NPI for Projection Year 2008 (S$000) NPI for Projection Year 2009 (S$000) NLA as at 30 June 2007 (sq m) Appraised value by Knight Frank as at 30 June 2007(1) (S$ million) GFA as at 30 June 2007 (sq m) Appraised value by Colliers as at 30 June 2007(1) (S$ million)

Annualised Forecast Period 2007 NPI yield on valuation by Knight Frank (%)

Annualised Forecast Period 2007 NPI yield on valuation by Colliers (%)

Occupancy as at 30 June 2007 (%)

Percentage of aggregate value of the Properties (as determined by Knight Frank) (%)

Gajah Mada Plaza . . . . . 8,319 8,895 17,356 5,548 5,729 80.2 6.5 79.7 18,274 214.8 8.0 211.1 8.1 6.5 8,943 94.2 9.0 101.8 8.3 10,253 103.8 7.2 117.0 6.4 66,160 49,341 91,232 25,767

Jakarta

3,726

34,278 34,139 58,685(2) 17,974(3)

89.1 86.4 96.4 96.3

10.3 9.4 21.4 8.0

Cibubur Junction . . .

Jakarta

4,233

The Plaza Semanggi . .

Jakarta

8,572

Mal Lippo Cikarang . . .

Cikarang, Greater Jakarta 5,798 7,503 66.0 7.0 68.1

2,589

Ekalokasari Plaza . . . . .

Bogor, Greater Jakarta

2,296

6.7

39,895

20,587(4)

87.3

6.6

Bandung Indah Plaza . . . . . 11,756 8,958 9,285 125.7 12,811 124.5

Bandung, West Java

5,668

9.1 6.8

135.1 114.7

8.4 7.5

55,196 37,434

26,472(5) 27,247

83.2 98.9

12.4 12.5

Istana Plaza . .

Bandung, West Java

4,286

Total for Retail Malls . . . . . 66,629(6) 72,800(6)

31,371(6)

809.2

7.8

827.4(6)

7.6

365,025

219,382

91.6(7)

80.5(6)

13

14
NPI for Forecast Period 2007 (S$000) NPI for Projection Year 2008 (S$000) NPI for Projection Year 2009 (S$000) NLA as at 30 June 2007 (sq m) Appraised value by Knight Frank as at 30 June 2007(1) (S$ million) Annualised Forecast Period 2007 NPI yield on valuation by Knight Frank (%) Appraised value by Colliers as at 30 June 2007(1) (S$ million) Annualised Forecast Period 2007 NPI yield on valuation by Colliers (%)

Retail Space

Location

Percentage of aggregate value of the Properties (as determined by Knight Frank) (%)

. 1,156 861 836 834 1,081 886 6,497 37,868(10) 1,004.7 7.5 80,037(10) 86,426(10) 1,829 13,408 1,859 13,626(6) 26.2 195.5 6.8 6.6 25.2 188.9(6) 1,016.3 7.0 6.9 7.5 2,382 1,778 1,726 1,723 2,228 2,420 1,807 1,754 1,751 2,264 33.5 25.7 26.0 25.5 33.4 6.9 6.7 6.4 6.5 6.5 32.2 24.8 25.0 25.8 31.8 7.2 7.0 6.7 6.5 6.8

Tangerang, Greater Jakarta

843

1,742

1,770

25.2

6.7

24.3

6.9

11,184(8) 15,248(9) 13,045(9) 11,082(8) 11,065(9) 19,029 13,417(9) 94,070 313,452

2.5 3.3 2.6 2.6 2.5 3.3 2.6 19.5(6) 100.0

. . . . .

Tangerang, Greater Jakarta Depok, Greater Jakarta Semarang, Central Java Malang, East Java Madiun, East Java

Mall WTC Matahari Units . . Metropolis Town Square Units . . . . . . . . . . . . . . . Depok Town Square Units . Java Supermall Units . . . . . Malang Town Square Units . Plaza Madiun . . . . . . . . . . Grand Palladium Medan Units . . . . . . . . . . . . . . . Total for Retail Spaces . . .

. .

Medan, North Sumatra

Total for Properties . . . . . .

Notes:

(1)

Based on exchange rate adopted at S$1 = Rp. 5,900

(2)

Current ongoing asset enhancement works to include a new alfresco caf area called the Plangi on the Sky caf will increase NLA by an estimated 3,000 sq m, bringing total NLA to approximately 61,685 sq m by the end of 2007.

(3)

Recently completed asset enhancement works to expand the retail space at Mal Lippo Cikarang have increased the NLA by 10,694 sq m, bringing the total NLA to 28,668 sq m.

(4)

Recently completed asset enhancement works for the third floor and mezzanine floor have increased the NLA by 5,013 sq m, bringing the total NLA to 25,600 sq m.

(5)

Recently completed asset enhancement works have increased the NLA by 3,843 sq m, bringing the total NLA to 30,315 sq m.

(6)

Due to rounding differences.

(7)

Weighted average occupancy as at 30 June 2007.

(8)

Based on Strata Titles Ownership Certificates.

(9)

Based on Kiosks Sale and Purchase Binding Agreements (See Business and PropertiesInformation Regarding the Title of the PropertiesThe Retail SpacesKiosks Sale and Purchase Binding Agreement.).

(10) Does not tie in with the NPI in the consolidated statement of total return for the Forecast Period 2007, Projection Period 2008 and Projection Period 2009 as the NPI in the consolidated statement of total return for these respective periods include the operating expenses of the Singapore SPCs.

Location of the Properties in Indonesia

15

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16

INFORMATION ON THE PROPERTIES The Retail Malls The Retail Malls are all located in Indonesia and have a total NLA of 219,382 sq m as at 30 June 2007. The Retail Malls are strategically located within Greater Jakarta and Bandung and are centrally located within their respective trade areas, with a total population catchment ranging between 0.8 million and 3.7 million. (See Business and Properties.) A summary of the key features of each Retail Mall is as follows: Gajah Mada Plaza JaIan Gajah Mada 19-26, Central Jakarta Brief description . . . . . . . . . . . . . . . . Gajah Mada Plaza is a seven storey with one basement level shopping centre and a carpark comprising 885 parking lots. The mall is located prominently in the heart of Jakartas Chinatown, an established and well-known commercial area in the city. Situated along Jalan Gajah Mada, one of the main roads in Jakarta, Gajah Mada Plaza is positioned as a one-stop shopping, dining and entertainment destination for middle to upper income families as well as professional executives and students from the offices and schools within its vicinity. The 222 tenancies in the mall provide a diverse and complementary tenant mix anchored by Hypermart and Rimo Department Store. The malls strong leisure and entertainment component, which includes a cinema, restaurants, family karaoke outlets, a discotheque, video game centres, a fitness centre and a swimming pool, adds to the overall attractiveness of Gajah Mada Plaza. 429,298 households(1) Strata Titles as evidenced by certificates : No. 438/I/S Kel Petojo Utara, registered under the name of PT Graha Baru Raya; No. 440/II/S Kel Petojo Utara, registered under the name of PT Graha Baru Raya; No. 442/III/S Kel Petojo Utara, registered under the name of PT Graha Baru Raya; No. 325/-I/S Kel Petojo Utara, registered under the name of PT Graha Baru Raya; No. 326/-I/S Kel Petojo Utara, registered under the name of PT Graha Baru Raya; No. 328/I/S Kel Petojo Utara, registered under the name of PT Graha Baru Raya; No. 330/II/S Kel Petojo Utara, registered under the name of PT Graha Baru Raya; No. 332/III/S Kel Petojo Utara, registered under the name of PT Graha Baru Raya; No. 333/IV/S Kel Petojo Utara, registered under the name of PT Graha Baru Raya; No. 334/V/S Kel Petojo Utara, registered under the name of PT Graha Baru Raya;
17

Population catchment . . . . . . . . . . . . Title . . . . . . . . . . . . . . . . . . . . . . . . . .

 No. 335/V-VI-VII/S Kel Petojo Utara, registered under the name of PT Graha Baru Raya; No. 336/VI-VII/S Kel Petojo Utara, registered under the name of PT Graha Baru Raya; No. 337/VII/S Kel Petojo Utara, registered under the name of PT Graha Baru Raya; and No. 338/VIII/S Kel Petojo Utara, registered under the name of PT Graha Baru Raya. The above strata titles are constructed on HGB underlying common land, valid until 24 January 2020 and are extendable for another term of up to 20 years. Following the expiration of this additional term, a renewal application may be made. (See Overview of Relevant Laws and Regulations in Indonesia Rights to Own and/or to UseStrata Titles.) (See Business and PropertiesGajah Mada Plaza.) Year of building completion . . . . . . . . Appraised value by Knight Frank as at 30 June 2007 . . . . . . . . . . . . . . . . . . Appraised value by Colliers as at 30 June 2007 . . . . . . . . . . . . . . . . . . Strata Titles Area . . . . . . . . . . . . . . . GFA as at 30 June 2007 . . . . . . . . . . NLA as at 30 June 2007 . . . . . . . . . . NPI for Forecast Period 2007, Projection Year 2008 and Projection Year 2009 (S$000) . . . . . . 1982

S$103.8 million

S$117.0 million 37,501 sq m 66,160 sq m 34,278 sq m

Forecast Period 20073,726 Projection Year 20088,319 Projection Year 200910,253

Percentage of contribution to LMIR Trusts Gross Rent for Forecast Period 2007 . . . . . . . . . . . . . . . . . . . . . . . . . 10.5% Number of tenants as at 30 June 2007 . . . . . . . . . . . . . . . . . . . . . . . . . Occupancy rate as at 30 June 2007. . Key anchors/tenants . . . . . . . . . . . . .

222 89.1% Millennium International Executive Club, Hypermart, Rimo Department Store, McDonalds and Inul Vizta Karaoke 885 665

Car parking lots . . . . . . . . . . . . . . . . . Motorcycle parking lots . . . . . . . . . . .

Note: (1) The figure comprises the number of households within the primary trade area of the relevant Retail Mall. (See Appendix FIndependent Report on the Indonesian Retail Property Market.)
18

Pictures of Gajah Mada Plaza

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Cibubur Junction Jalan Jambore Raya 1, Cibubur, East Jakarta Brief description . . . . . . . . . . . . . . . . Cibubur Junction is a five storey with one basement level and partial roof top level shopping centre with a carpark comprising 611 parking lots. The mall is located strategically in the middle of Cibubur which is one of the most affluent and upmarket residential areas in Jakarta. The mall is situated five km south of Jakartas Jagorawi toll road and is easily accessible and visible from the main road. Being the only retail mall with a NLA of above 20,000 sq m within an approximately 10-km radius, Cibubur Junction is the only mall within its locality that offers a one-stop shopping experience. Its anchor tenants, Hypermart and Matahari Department Store are well complemented by international and local specialty tenants which include restaurants, fashion labels, a cinema, bookstores, a video game centre and a fitness centre. Population catchment . . . . . . . . . . . . Title . . . . . . . . . . . . . . . . . . . . . . . . . . 422,862 households(1) Cibubur Junction is owned by PT Cibubur Utama and was built pursuant to a BOT Scheme based on the deed of cooperation agreement and its amendments, between PD Pembangunan Sarana Jaya DKI Jakarta as BOT Grantor and PT Cibubur Utama as BOT Grantee. The Cibubur Junction BOT arrangement between PT Cibubur Utama and PD Pembangunan Sarana Jaya DKI Jakarta shall be valid until 28 July 2025 and may be extended. The underlying BOT land, on which Cibubur Junction is constructed, is represented by HGB title No. 01210/Cibubur which is valid until 23 December 2021 and is extendable for another term of up to 20 years. Following expiration of this additional term, a renewal application may be made. (See Overview of Relevant Laws and Regulations in Indonesia Rights to Own and/or to UseHak Guna Bangunan (HGB/ Right to Build). (See Business and Properties Cibubur Junction.) Year of building completion . . . . . . . . Appraised value by Knight Frank as at 30 June 2007 . . . . . . . . . . . . . . . . . . Appraised value by Colliers as at 30 June 2007 . . . . . . . . . . . . . . . . . . Land Area . . . . . . . . . . . . . . . . . . . . . GFA as at 30 June 2007 . . . . . . . . . . NLA as at 30 June 2007 . . . . . . . . . . NPI for Forecast Period 2007, Projection Year 2008 and Projection Year 2009 (S$000) . . . . . . 2005 S$94.2 million S$101.8 million 31,987 sq m 49,341 sq m 34,139 sq m

Forecast Period 20074,233 Projection Year 20088,895 Projection Year 20098,943

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Percentage of contribution to LMIR Trusts Gross Rent for Forecast Period 2007 . . . . . . . . . . . . . . . . . . . . . . . . . 11.2% Number of tenants as at 30 June 2007 . . . . . . . . . . . . . . . . . . . . . . . . . Occupancy rate as at 30 June 2007. . Key anchors/tenants . . . . . . . . . . . . . Car parking lots . . . . . . . . . . . . . . . . . Motorcycle parking lots . . . . . . . . . . . Note: (1) The figure comprises the number of households within the primary trade area of the relevant Retail Mall. (See Appendix FIndependent Report on the Indonesian Retail Property Market.) 163 86.4% Hypermart, Matahari Department Store, Fitness First, Sport Warehouse and Studio 21 Cinema 611 500

Pictures of Cibubur Junction

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The Plaza Semanggi Jalan Jend. Sudirman Kav.50, South Jakarta Brief description . . . . . . . . . . . . . . . . The Plaza Semanggi is a modern shopping centre comprising seven storey and two basement levels shopping centre and 13 levels of office floors, with a carpark comprising 1,100 parking lots. The Plaza Semanggi is strategically located in the heart of Jakartas CBD within the citys Golden Triangle at the Semanggi interchange, which is a junction channeling north-south and east-west traffic across central Jakarta. The centre is situated among many commercial buildings and adjacent to Atmajaya University, one of Jakartas most prominent universities. Anchored by Centro Department Store and Giant Hypermarket, the 479 tenants (as at 30 June 2007) provide all categories of shoppers with a diverse and comprehensive tenant mix. The Plaza Semanggi offers both destination and convenience shopping, and is supported by its central location, which is easily accessible by cars and public transport. 270,387 households(1) The Plaza Semanggi was built pursuant to a BOT Scheme based on the introductory agreement of revitalisation, management and transfer (Perjanjian Pengikatan Revitalisasi, Pengelolaan dan Pengalihan) and its amendments, between Yayasan Gedung Veteran Republik Indonesia as BOT Grantor and PT Primatama Nusa Indah as BOT Grantee. The BOT agreement is valid for 30 years from 8 July 2004. PT Primatama Nusa Indah as BOT Grantee has an option to extend the term of the BOT Agreement for a period of 20 years, with a notification to the BOT Grantor at least six months prior to the expiration date. Upon this notification, the BOT Grantor then grants its approval for the extension. The underlying BOT land, on which Plaza Semanggi is constructed, is represented by HP title No. 133/Karet Semanggi, and is valid as long as the land is being used. (See Business and PropertiesThe Plaza Semanggi.) Year of building completion . . . . . . . . Appraised value by Knight Frank as at 30 June 2007 . . . . . . . . . . . . . . . . . . Appraised value by Colliers as at 30 June 2007 . . . . . . . . . . . . . . . . . . Land Area . . . . . . . . . . . . . . . . . . . . . GFA as at 30 June 2007 . . . . . . . . . . NLA as at 30 June 2007 . . . . . . . . . . NPI for Forecast Period 2007, Projection Year 2008 and Projection Year 2009 (S$000) . . . . . 2003 S$214.8 million S$211.1 million 19,000 sq m 91,232 sq m 58,685 sq m(2)

Population catchment . . . . . . . . . . . . Title . . . . . . . . . . . . . . . . . . . . . . . . . .

Forecast Period 20078,572 Projection Year 200817,356 Projection Year 200918,274

Percentage of contribution to LMIR Trusts Gross Rent for Forecast Period 2007 . . . . . . . . . . . . . . . . . . . . . . . . . 20.4%
22

Number of tenants as at 30 June 2007 . . . . . . . . . . . . . . . . . . . . . . . . . Occupancy rate as at 30 June 2007. . Key anchors/tenants . . . . . . . . . . . . . Car parking lots . . . . . . . . . . . . . . . . . Motorcycle parking lots . . . . . . . . . . . Notes: (1) (2)

479 96.4% Centro Department Store, Giant Hypermarket, Electronic Solution Indonesia, Kentucky Fried Chicken and X Lounge 1,100 750

The figure comprises the number of households within the primary trade area of the relevant Retail Mall. (See Appendix FIndependent Report on the Indonesian Retail Property Market.) Current ongoing asset enhancement works to include a new alfresco caf area called the Plangi on the Sky caf will increase NLA by an estimated 3,000 sq m, bringing total NLA to approximately 61,685 sq m by the end of 2007.

Pictures of The Plaza Semanggi

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Mal Lippo Cikarang Jalan MH Thamrin, Lippo Cikarang, Greater Jakarta Brief description . . . . . . . . . . . . . . . . Mal Lippo Cikarang is a two-level retail mall located within the Lippo Cikarang estate. The estate is approximately 40 km east of Jakarta and is connected to Jakarta via the Jakarta-Cilkampek toll road. Comprising industrial, commercial and residential components, the Lippo Cikarang estate is home to 25,000 residents and approximately 65,000 jobs. Mal Lippo Cikarang is the main shopping centre in the estate and has limited competition within an approximately 10-km radius. The mall is anchored by Matahari Department Store, Hypermart and Hero Supermarket, complemented by a cinema, a bookshop, a video game centre, restaurants and dining outlets. The mall has recently completed a S$4.7 million expansion and renovation programme which has increased its NLA by more than 50.0%. 84,962 households(1) Mal Lippo Cikarang was built on a plot of land of 49,250 sq m based on measurement letter No. 19128/1994 dated 25 August 1994 and Certificate of Right to Build (HGB title) No. 627/ Kelurahan Cibatu, registered under the name of PT Graha Nusa Raya, issued by Bekasi Land Office on 9 December 1994, and valid until 5 May 2023 and is extendable for another term of up to 20 years. Following the expiration of this additional term, a renewal application may be made. (See Overview of the Relevant Laws and Regulations in Indonesia Rights to Own and/or to UseHak Guna Bangunan (HGB/Right to Build).) (See Business and PropertiesMal Lippo Cikarang.) Year of building completion . . . . . . . . Appraised value by Knight Frank as at 30 June 2007 . . . . . . . . . . . . . . . . . . Appraised value by Colliers as at 30 June 2007 . . . . . . . . . . . . . . . . . . Land Area . . . . . . . . . . . . . . . . . . . . . GFA as at 30 June 2007 . . . . . . . . . . NLA as at 30 June 2007 . . . . . . . . . . NPI for Forecast Period 2007, Projection Year 2008 and Projection Year 2009 (S$000) . . . . . . . . . . . . . . 1995 S$80.2 million S$79.7 million 49,250 sq m 25,767 sq m 17,974 sq m(2)

Population catchment . . . . . . . . . . . . Title . . . . . . . . . . . . . . . . . . . . . . . . . .

Forecast Period 20072,589 Projection Year 20085,548 Projection Year 20095,729

Percentage of contribution to LMIR Trusts Gross Rent for Forecast Period 2007 . . . . . . . . . . . . . . . . . . . . . . . . . 6.8% Number of tenants as at 30 June 2007 . . . . . . . . . . . . . . . . . . . . . . . . . Occupancy rate as at 30 June 2007. . Key anchors / tenants . . . . . . . . . . . . 116 96.3% Matahari Department Store, Hypermart, Hero Supermarket, Studio 21 Cinema, Batik Keris and Toko Buku Utama bookstore(3)

24

Car parking lots . . . . . . . . . . . . . . . . . Motorcycle parking lots . . . . . . . . . . . Notes: (1) (2) (3)

513 950

The figure comprises the number of households within the primary trade area of the relevant Retail Mall. (See Appendix FIndependent Report on the Indonesian Retail Property Market.) Recently completed asset enhancement works to expand the retail space at Mal Lippo Cikarang have increased the NLA by 10,694 sq m, bringing the total NLA to 28,668 sq m. Following the completion of the asset enhancement works stated in (2), Hypermart has precommitted to lease 8,539 sq m of the extended area.

Pictures of Mal Lippo Cikarang

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Ekalokasari Plaza Jalan Siliwangi 123, Bogor, Greater Jakarta Brief description . . . . . . . . . . . . . . . . Ekalokasari Plaza is a six storey with three basement levels retail mall with a carpark comprising 390 parking lots. The mall is located approximately two km south east of the Bogor City Centre on a major road, Jalan Siliwangi, and approximately 3.5 km south or five minutes drive from the Bogor exit of the Jagorawi toll road which connects Jakarta to Bogor. Bogor is approximately 50 km south of Jakarta and had a population of approximately 855,000 as at 2002. Ekalokasari Plaza is positioned as the retail mall of convenience and choice for its population catchment. It provides a comprehensive retail mix anchored by Matahari Department Store, Foodmart supermarket, two large bookstores and a concentration of fashion labels and outlets. Ekalokasari Plaza has recently completed S$2.0 million expansion and renovation programme for the third and mezzanine floors. The new expanded area will house a food court, and is also intended to include a fitness centre and a cinema. 144,451 households(1) Ekalokasari Plaza is owned by PT Indah Pesona Bogor and was built pursuant to a BOT Scheme based on the cooperation agreement (Perjanjian Kerjasama) between Institut Pertanian Bogor (IPB) represented by PT Bogor Life Science and Technology as BOT Grantor and PT Indah Pesona Bogor (PT IPB). The BOT Scheme relating to Ekalokasari Plaza is valid from 27 June 2001 to 27 June 2032 and may be extended. The underlying BOT land, on which Ekalokasari Plaza is constructed, is represented by HP title No. 1/Sukasari which is valid as long as the land is being used. (See Business and PropertiesEkalokasari Plaza.) Year of building completion . . . . . . . . Appraised value by Knight Frank as at 30 June 2007 . . . . . . . . . . . . . . . . . . Appraised value by Colliers as at 30 June 2007 . . . . . . . . . . . . . . . . . . Land Area . . . . . . . . . . . . . . . . . . . . . GFA as at 30 June 2007 . . . . . . . . . . NLA as at 30 June 2007 . . . . . . . . . . NPI for Forecast Period 2007, Projection Year 2008 and Projection Year 2009 (S$000) . . . . . . . . . . . . . . 2003 S$66.0 million S$68.1 million 10,500 sq m 39,895 sq m 20,587 sq m(2)

Population catchment . . . . . . . . . . . . Title . . . . . . . . . . . . . . . . . . . . . . . . . .

Forecast Period 20072,296 Projection Year 20085,798 Projection Year 20097,503

Percentage of contribution to LMIR Trusts Gross Rent for Forecast Period 2007 . . . . . . . . . . . . . . . . . . . . . . . . . 5.8% Number of tenants as at 30 June 2007 . . . . . . . . . . . . . . . . . . . . . . . . .
26

107

Occupancy rate as at 30 June 2007. . Key anchors / tenants . . . . . . . . . . . . Car parking lots . . . . . . . . . . . . . . . . . Motorcycle parking lots . . . . . . . . . . . Notes: (1) (2)

87.3% Matahari Department Store, Foodmart supermarket, Gramedia bookstore, Karisma, Number 61 and Kentucky Fried Chicken 390 382

The figure comprises the number of households within the primary trade area of the relevant Retail Mall. (See Appendix FIndependent Report on the Indonesian Retail Property Market.) Recently completed asset enhancement works for the third floor and mezzanine have increased the NLA by 5,013 sq m, bringing the total NLA to 25,600 sq m.

Pictures of Ekalokasari Plaza

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Bandung Indah Plaza Jalan Merdeka No. 56, Bandung, West Java Brief description . . . . . . . . . . . . . . . . Bandung Indah Plaza is a four storey with three basement levels retail mall with a carpark comprising 602 parking lots. It is located strategically in the heart of the CBD of Bandung, the fourth most populous city in Indonesia. The retail mall is easily accessible from Jalan Merdeka, a major road which connects North Bandung to South Bandung, and is surrounded by commercial buildings and middle to upper income residential areas. It is also attached to Hyatt Regency Hotel, one of the leading five-star hotels in Bandung. Bandung Indah Plaza is anchored by Matahari Department Store, Hypermart, Yogya Supermarket, a bookstore, a cinema and supported by a list of international and local tenants. It has recently completed a S$12.6 million expansion and renovation programme. 124,947 households(1) Bandung Indah Plaza is owned by PT Megah Semesta Abadi and was built pursuant to a BOT Scheme based on cooperation agreement on the renovation, development and management of Hotel Pakunegara, Bandung (Perjanjian Kerjasama Pemugaran Pembangunan dan Pengelolaan Hotel Pakunegara) between Perusahaan Daerah Jasa Dan Kepariwisataan Propinsi Jawa Barat, and formerly known as Perusahaan Daerah Kerta Wisata Jawa Barat) and PT Bhuwanatala Indah Permai Tbk (formerly known as PT Bandung Indah Plaza Permai) (Bandung Indah Plaza Cooperation Agreement) and was novated by a novation agreement to PT Megah Semesta Abadi from PT Bhuwanatala Indah Permai Tbk. on 29 December 2003. The Bandung Indah Plaza Cooperation Agreement, its amendments and the novation agreement are jointly referred to as the Bandung Indah Plaza BOT Agreement. The term of the Bandung Indah Plaza BOT Agreement is for 30 years as of the commencement of commercial operation and will expire on 31 December 2030 and may be extended. The BOT Grantor has granted the BOT Grantee, the owner of Bandung Indah Plaza, the right to apply for a HGB title on top of its HPL title. (See Business and PropertiesInformation Regarding the Title of the PropertiesHak Pengelolaan (HPL) titles.) Bandung Indah Plaza was built on the following: (a) (b) HGB title No. 26/Citarum valid up to 19 August 2010; and The HGB titles on top of HPL titles are as follows: (i) (ii) (iii) HGB titles No. 130/Citarum, No. 131/Citarum, and No. 64/Citarum, valid up to 20 October 2017; HGB titles No. 65/Citarum and No. 69/Citarum, valid up to 8 September 2019; and HGB titles No. 89/Merdeka and 90/Merdeka, valid up to 30 January 2021.

Population catchment . . . . . . . . . . . . Title . . . . . . . . . . . . . . . . . . . . . . . . . .

Upon the expiry of the above HGB titles, the term of the HGB titles can, subject to the provisions of the BOT Agreement, be extended for another term of up to 20 years. (See Overview of Relevant Laws and Regulations in IndonesiaRights to Own
28

and/or to UseHak Guna Bangunan (HGB/Right to Build) and Overview of Relevant Laws and Regulations in Indonesia Rights to Own and/or to UseHak Pakai (HP/Right to Use).) The HPL titles are valid as long as the land is being used. (See Business and PropertiesBandung Indah Plaza.) Year of building completion . . . . . . . . Appraised value by Knight Frank as at 30 June 2007 . . . . . . . . . . . . . . . . . . Appraised value by Colliers as at 30 June 2007 . . . . . . . . . . . . . . . . . . Land Area . . . . . . . . . . . . . . . . . . . . . GFA as at 30 June 2007 . . . . . . . . . . NLA as at 30 June 2007 . . . . . . . . . . NPI for Forecast Period 2007, Projection Year 2008 and Projection Year 2009 (S$000) . . . . . . . . . . . . . . 1990 S$124.5 million S$135.1 million 15,779 sq m 55,196 sq m 26,472 sq m(2)

Forecast Period 20075,668 Projection Year 200811,756 Projection Year 200912,811

Percentage of contribution to LMIR Trusts Gross Rent for Forecast Period 2007 . . . . . . . . . . . . . . . . . . . . . . . . . 14.4% Number of tenants as at 30 June 2007 . . . . . . . . . . . . . . . . . . . . . . . . . Occupancy rate as at 30 June 2007. . Key anchors / tenants . . . . . . . . . . . . Car parking lots . . . . . . . . . . . . . . . . . Motorcycle parking lots . . . . . . . . . . . Notes: (1) The figure comprises the number of households within the primary trade area of the relevant Retail Mall. (See Appendix FIndependent Report on the Indonesian Retail Property Market.) (2) Recently completed asset enhancement works have increased the NLA by 3,843 sq m, bringing the total NLA to 30,315 sq m. 180 83.2% Matahari Department Store, Hypermart, McDonalds, Yogya Supermarket and Toko Gunung Agung bookstore 602 700

Pictures of Bandung Indah Plaza

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Istana Plaza Jalan Pasirkaliki No. 121-123, Bandung, West Java Brief description . . . . . . . . . . . . . . . . Istana Plaza is a four storey with two basement levels retail mall with a carpark comprising 700 parking lots. It is located strategically in the CBD of Bandung, the fourth most populous city in Indonesia. Situated at the junction between two busy roads of Jalan Pasir Kaliki and Jalan Pajajaran, it is easily accessible by car and public transport. Anchored by Rimo Department Store and Hero Supermarket, the 205 tenancies in Istana Plaza provide one-stop shopping experience for the middle to upper income residents within its population catchment. Istana Plazas many popular international fashion labels have also helped to attract the young and trendy shopper base. 99,525 households(1) Istana Plaza is owned by PT Suryana Istana Pasundan and was built pursuant to BOT scheme based on the cooperation agreement, dated 9 May 1997 between, Gereja Kristen Pasundan, Ginawan Chondro, Edi Sukamto Josana, Chandra Tambayong, Wirawan Chondro, Heryanto Gunawan, and Subagya Putra Prawira (as investors), and TK Gunawan Prihatna, Stepanus Tedjasentosa, Tatang Budiarto, and Abrijanto Effendi (as consultants) (the Istana Plaza Cooperation Agreement). The Istana Plaza Cooperation Agreement and its amendments shall be jointly referred to as the Istana Plaza BOT Agreement. The Istana Plaza BOT Agreement is valid for 32 years from January 2002. The underlying BOT land, on which Istana Plaza is constructed, is held by the BOT Grantor under the following HGB titles: (i) (ii) No. 43/Pamoyanan, valid until 24 September 2032; No. 58/Pamoyanan, valid until 24 September 2032;

Population catchment . . . . . . . . . . . . Title . . . . . . . . . . . . . . . . . . . . . . . . . .

(iii) No. 177/Pajajaran, valid until 24 September 2032; (iv) No. 59/Pamoyanan, valid until 24 September 2036; and (v) No. 60/Pamoyanan, valid until 24 September 2036.

The above HGB titles can be extended for another term of up to 20 years. Following the expiration of this additional term, a renewal application may be made (See Overview of Relevant Laws and Regulations in IndonesiaRights to Own and/or to UseHak Guna Bangunan (HGB/Right to Build).) (See Business and PropertiesIstana Plaza.) Year of building completion . . . . . . . . Appraised value by Knight Frank as at 30 June 2007 . . . . . . . . . . . . . . . . . . Appraised value by Colliers as at 30 June 2007 . . . . . . . . . . . . . . . . . . Land Area . . . . . . . . . . . . . . . . . . . . . GFA as at 30 June 2007 . . . . . . . . . .
30

2001 S$125.7 million S$114.7 million 13,082 sq m 37,434 sq m

NLA as at 30 June 2007 . . . . . . . . . . NPI for Forecast Period 2007, Projection Year 2008 and Projection Year 2009 (S$000) . . . . . . . . . . . . . .

27,247 sq m

Forecast Period 20074,286 Projection Year 20088,958 Projection Year 20099,285

Percentage of contribution to LMIR Trusts Gross Rent for Forecast Period 2007 . . . . . . . . . . . . . . . . . . . . . . . . . 12.0% Number of tenants as at 30 June 2007 . . . . . . . . . . . . . . . . . . . . . . . . . Occupancy rate as at 30 June 2007. . Key anchors/tenants . . . . . . . . . . . . . Car parking lots . . . . . . . . . . . . . . . . . Motorcycle parking lots . . . . . . . . . . . 205 98.9% Rimo Department Store, Ace Hardware, Gramedia bookstore, Game Master and Planet Sport 700 500

Note: (1) The figure comprises the number of households within the primary trade area of the relevant Retail Mall. (See Appendix FIndependent Report on the Indonesian Retail Property Market.)

Pictures of Istana Plaza

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The Retail Spaces The Retail Spaces are all located in Indonesia. The Retail Spaces occupy a total NLA of 94,070 sq m and are strategically located as anchor spaces within retail malls. Three of the seven Retail Spaces are located within Greater Jakarta and four are situated in the major cities of Semarang, Madiun, Malang and Medan. (See Business and Properties.) A summary of each Retail Space is as follows: Mall WTC Matahari Units Jalan Raya Serpong, Pondok Jagung, Serpong, Tangerang, Banten, Greater Jakarta Brief description . . . . . . . . . . . . . . . . The Mall WTC Matahari Units comprise four strata units on part of the ground floor, upper ground floor, mezzanine and second floor of Mall WTC Matahari which are currently occupied by Hypermart, Matahari Department Store and Timezone. Mall WTC Matahari is located along Jalan Serpong Raya, Serpong within the administrative area of Tangerang regency, Banten province. It is situated approximately 18 km west of Jakartas CBD. Tangerang is renowned as an industrial and manufacturing city in Greater Jakarta, being home to seven industrial estates with a total area of approximately 1,700 ha. Due to its proximity to Jakarta, Tangerang benefits from the urban expansion of Jakarta and is home to commuters who work in Jakarta. In recent years, residential estates and satellite cities with their facilities have been developed in Tangerang. Mall WTC Matahari is strategically located along the main road connecting the BSD residential estate, the largest residential estate in Greater Jakarta. It has a proposed development area of 6,000 ha with currently 1,500 ha developed and occupied by over 15,000 households. In recent years, BSD City has experienced rapid growth in terms of the number of housing units and retail shop houses which have been built. Title . . . . . . . . . . . . . . . . . . . . . . . . . . Mall WTC Matahari was built on plots of land covering an area of: (i) (ii) 3,470 sq m with Strata Titles Ownership Certificate No. 428/Desa Pondok Jagung dated 17 December 2004; 5,892 sq m with Strata Titles Ownership Certificate No. 00153/Desa Pondok Jagung dated 17 December 2004;

Locality information . . . . . . . . . . . . . .

(iii) 873 sq m with Strata Titles Ownership Certificate No. 00372/Desa Pondok Jagung dated 17 December 2004; and (iv) 949 sq m with Strata Titles Ownership Certificate No. 00197/Desa Pondok Jagung dated 17 December 2004, all of which are registered under the name of Matahari and its underlying HGB common land will expire on 8 April 2018 but is extendable for another term of up to 20 years. Following the expiration of this additional term, a renewal application may be made. (See Overview of Relevant Laws and Regulations in IndonesiaRights to Own and/or to UseHak Guna Bangunan (HGB/Right to Build).) (See Business and PropertiesMall WTC Matahari Units.)
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Year of building completion . . . . . . . . Appraised value by Knight Frank as at 30 June 2007 . . . . . . . . . . . . . . . . . . Appraised value by Colliers as at 30 June 2007 . . . . . . . . . . . . . . . . . . NLA as at 30 June 2007 . . . . . . . . . . NPI for Forecast Period 2007, Projection Year 2008 and Projection Year 2009 (S$000) . . . . . . . . . . . . . .

2003 S$25.2 million S$24.3 million 11,184 sq m(1)

Forecast Period 2007843 Projection Year 20081,742 Projection Year 20091,770

Percentage of contribution to LMIR Trusts Gross Rent for Forecast Period 2007 . . . . . . . . . . . . . . . . . . . . . . . . . 2.5% Note: (1) Based on Strata Titles Ownership Certificates. (See Business and PropertiesMall WTC Matahari UnitsRelevant Information relating to the Mall WTC Matahari UnitsTitle.)

Picture of the Mall WTC Matahari Units

33

Metropolis Town Square Units Jalan Hartono Raya, Modernland Cikokol, Tangerang, Banten, Greater Jakarta Brief description . . . . . . . . . . . . . . . . The Metropolis Town Square Units comprise three strata units on part of the ground floor, first floor and second floor of Metropolis Town Square, a one-stop shopping mall located along one of the main roads in Tangerang. The Metropolis Town Square Units are currently occupied by Hypermart, Matahari Department Store and Timezone. Locality information . . . . . . . . . . . . . . Metropolis Town Square is located in Tangerang city, Banten province, approximately 20 km west of Jakartas CBD. The CBDs strategic location near the main road connecting the toll road to Tangerang city provides easy access to the JakartaMerak toll gate and surrounding residential areas in Tangerang. Tangerang is an industrial and manufacturing city in Greater Jakarta, home to seven industrial estates with a total area of approximately 1,700 ha. Due to its proximity to Jakarta, Tangerang is a popular residential location for commuters who work in Jakarta. In recent years, residential estates and satellite cities (for example, Lippo Karawaci, Bumi Serpong Damai, Kota Modern, Alam Sutra, Summarecon Serpong and Bintaro Jaya) have been developed in Tangerang. Metropolis Town Square is located along Jalan Hartono Raya within the Kota Modern residential estate, about 2.6 km south of the city centre of Tangerang. Tangerangs strategic location between Jakarta and the Soekarno-Hatta International Airport makes it a popular choice for offices and factories. The Indonesian government has continuously been improving the quality of infrastructure between the city and the nations capital to accommodate the ever increasing road traffic. Title . . . . . . . . . . . . . . . . . . . . . . . . . . Metropolis Town Square Units are constructed on HGB titles and are currently exclusively controlled by Matahari pursuant to Kiosks Sale and Purchase Binding Agreement: (i) (ii) No. 093/AGR/DM/MPP/IX/03, dated 10 September 2003; No. 054/AGR/DM/MPP/VI/03, dated 23 June 2003; and

(iii) No. 084/AGR/DM/MPP/VIII/03, dated 25 August 2003, all between Matahari and Coldwell Banker Dwimustika Mas. These Kiosks Sale and Purchase Binding Agreements are evidence of the parties intention to effect the sale and purchase of Strata Units, but do not have the effect of transferring ownership. The strata titles are in the process of being issued by the local land office. Upon issuance, the strata titles will be purchased by the relevant Retail Space Indonesian SPC. (See Business and Properties Metropolis Town Square Units.) Year of building completion . . . . . . . .
34

2004

Appraised value by Knight Frank as at 30 June 2007 . . . . . . . . . . . . . . . . . . Appraised value by Colliers as at 30 June 2007 . . . . . . . . . . . . . . . . . . NLA as at 30 June 2007 . . . . . . . . . . NPI for Forecast Period 2007, Projection Year 2008 and Projection Year 2009 (S$000) . . . . . . . . . . . . . .

S$33.5 million S$32.2 million 15,248 sq m(1)

Forecast Period 20071,156 Projection Year 20082,382 Projection Year 20092,420

Percentage of contribution to LMIR Trusts Gross Rent for Forecast Period 2007 . . . . . . . . . . . . . . . . . . . . . . . . . 3.3% Note: (1) Based on Kiosks Sale and Purchase Binding Agreements. (See Business and Properties Metropolis Town Square UnitsRelevant Information relating to the Metropolis Town Square UnitsTitle.)

Picture of the Metropolis Town Square Units

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Depok Town Square Units Jalan Margonda Raya No. 1, Pondok Cina Beji, Depok, Greater Jakarta Brief description . . . . . . . . . . . . . . . . The Depok Town Square Units comprise four strata units on part of the lower ground floor, first floor and second floor of Depok Town Square, one of the newest and most comprehensive malls in Depok. The Depok Town Square Units are currently occupied by Hypermart, Matahari Department Store and Timezone. Locality information . . . . . . . . . . . . . . Depok is located in the West Java province, situated between southern Jakarta and the northern side of Bogor regency. The city is located approximately 16 km south of Jakartas CBD. Depok is renowned as the city of students, being home to four large universities (University of Indonesia, Gunadarma University, Tugu Polytechnic and Jakarta Polytechnic). Depoks population is estimated at 1.5 million in 2007 and has shown strong population growth, averaging 3.3% per annum between 2000 and 2005. In line with city population growth, the commercial area of Depok has been growing rapidly for the last few years, as evidenced by a number of modern shopping centre developments and commercial buildings built along the main road of Depok, Jalan Margonda Raya. Depok Town Square is located on Jalan Margonda Raya, adjacent to the south eastern side of University of Indonesia, a prominent university in Indonesia. The centre has direct access to Pondok Cina Railway Station at its rear entrance, and therefore connects the station to Jalan Margonda Raya. Title . . . . . . . . . . . . . . . . . . . . . . . . . . Depok Town Square Units are constructed on HGB titles and are currently exclusively controlled by Matahari pursuant to Kiosks Sale and Purchase Binding Agreement: (i) No. 031/AGR/DM/MPP/XII/02, dated 19 December 2002 entered into between Matahari and Coldwell Banker Dwimustika Mas; and

(ii) No. 012/JPN-PPJB/II/04, dated 11 February 2004, entered into between Matahari and PT Jagat Pertala Nusantara. These Kiosks Sale and Purchase Binding Agreements are evidence of the parties intention to effect the sale and purchase of strata units, but do not have the effect of transferring ownership. The strata titles are in the process of being issued by the local land office. Upon issuance, the strata titles will be purchased by the relevant Retail Space Indonesian SPC. (See Business and PropertiesDepok Town Square Units.) Year of building completion . . . . . . . . Appraised value by Knight Frank as at 30 June 2007 . . . . . . . . . . . . . . . . . . Appraised value by Colliers as at 30 June 2007 . . . . . . . . . . . . . . . . . . NLA as at 30 June 2007 . . . . . . . . . .
36

2005 S$25.7 million S$24.8 million 13,045 sq m(1)

NPI for Forecast Period 2007, Projection Year 2008 and Projection Year 2009 (S$000) . . . . . . . . . . . . . .

Forecast Period 2007861 Projection Year 20081,778 Projection Year 20091,807

Percentage of contribution to LMIR Trusts Gross Rent for Forecast Period 2007 . . . . . . . . . . . . . . . . . . . . . . . . . 2.5% Note: (1) Based on Kiosks Sale and Purchase Binding Agreements. (See Business and PropertiesDepok Town Square UnitsRelevant Information relating to the Depok Town Square UnitsTitle.)

Picture of the Depok Town Square Units

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Java Supermall Units Jalan MT Haryono No. 992-994, Jomblang, Semarang, Central Java Brief description . . . . . . . . . . . . . . . . The Java Supermall Units comprise four strata units on the semibasement, first floor and second floor of Java Supermall. Java Supermall is located within the vicinity of a middle to upper class residential area, which is easily accessible from most areas in Semarang. The Java Supermall Units are currently occupied by Matahari Department Store and Foodmart supermarket. Locality information . . . . . . . . . . . . . . Semarang is the capital city of the Central Java province and the fifth largest city in terms of population in Indonesia. With its location along the northern coast of Java, Semarang is an important trading port for the region. Semarang had a population of 1.3 million in 2000 and is estimated to have grown annually at 2.6% per annum, registering a total increase of approximately 1.5 million people over the last seven years. Title . . . . . . . . . . . . . . . . . . . . . . . . . . Java Supermall was built on a plot of land covering an area of: (i) (ii) 3,839 sq m with Strata Titles Ownership Certificate No. 1/ Desa Lamper Kidul dated 23 November 1998; 3,201 sq m with Strata Titles Ownership Certificate No. 2/ Desa Lamper Kidul dated 23 November 1998;

(iii) 3,772 sq m with Strata Titles Ownership Certificate No. 22/ Desa Lamper Kidul dated 23 November 1998; and (iv) 270 sq m with Strata Titles Ownership Certificate No. 45/ Desa Lamper Kidul dated 18 April 2000,

all of which are registered under the name of Matahari and its underlying HGB common land will expire on 24 September 2017 and is extendable for another term of up to 20 years. Following expiration of this additional term, a renewal application may be made. (See Overview of Relevant Laws and Regulations in IndonesiaRights to Own and/or to UseHak Guna Bangunan (HGB/Right to Build)). (See Business and PropertiesJava Supermall Units.) Year of building completion . . . . . . . . Appraised value by Knight Frank as at 30 June 2007 . . . . . . . . . . . . . . . . . . Appraised value by Colliers as at 30 June 2007 . . . . . . . . . . . . . . . . . . NLA as at 30 June 2007 . . . . . . . . . . NPI for Forecast Period 2007, Projection Year 2008 and Projection Year 2009 (S$000) . . . . . . . . . . . . . 2000 S$26.0 million S$25.0 million 11,082 sq m(1)

Forecast Period 2007836 Projection Year 20081,726 Projection Year 20091,754

Percentage of contribution to LMIR Trusts Gross Rent for Forecast Period 2007 . . . . . . . . . . . . . . . . . . . . . . . . . 2.4%
38

Note: (1) Based on Strata Titles Ownership Certificates. (See Business and PropertiesJava Supermall UnitsRelevant Information relating to the Java Supermarket UnitsTitle.)

Picture of the Java Supermall Units

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Malang Town Square Units Jalan Veteran No. 2, Malang, East Java Brief description . . . . . . . . . . . . . . . . The Malang Town Square Units comprise three strata units on part of the ground floor, upper ground floor, first floor and second floor of Malang Town Square, a mall conceptualised as an international lifestyle mall as well as the biggest and most comprehensive mall in Malang. The Malang Town Square Units are currently occupied by Hypermart, Matahari Department Store and Timezone. Locality information . . . . . . . . . . . . . . Malang is the second largest city in the East Java province with a population of approximately 0.8 million and a regency population of approximately 2.4 million people. The region is a popular tourist destination due to its natural attractions (for example, Mount Bromo, one of Javas largest volcanoes), cool climate and colonial history. Malang also has a large student population, being home to five universities (Brawijaya, State, Muhammadiyah, Widya Gama and Merdeka Universities). Malang Town Square, in which Malang Town Square Units are located, is a mall conceptualised as an international lifestyle mall as well as the biggest and most comprehensive mall in Malang. The centre has easy access to public transportation and is surrounded by exclusive residential communities and several universities which have more than 50,000 students. Title . . . . . . . . . . . . . . . . . . . . . . . . . . Malang Town Square Units are constructed on HGB land titles and are currently exclusively controlled by Matahari pursuant to Kiosks Sale and Purchase Binding Agreement No. 031/PNPPJB/X/03, dated 7 October 2003 between Matahari and PT Pendopo Niaga. The Kiosks Sale and Purchase Binding Agreement is evidence of the parties intention to effect the sale and purchase of strata units, but do not have the effect of transferring ownership. The strata titles are in the process of being issued by the local land office. Upon issuance, the strata titles will be purchased by the relevant Retail Space Indonesian SPC. (See Business and PropertiesMalang Town Square Units.) Year of building completion . . . . . . . . Appraised value by Knight Frank as at 30 June 2007 . . . . . . . . . . . . . . . . . . Appraised value by Colliers as at 30 June 2007 . . . . . . . . . . . . . . . . . . NLA as at 30 June 2007 . . . . . . . . . . NPI for Forecast Period 2007, Projection Year 2008 and Projection Year 2009 (S$000) . . . . . . . . . . . . . . 2005 S$25.5 million S$25.8 million 11,065 sq m(1)

Forecast Period 2007834 Projection Year 20081,723 Projection Year 20091,751

Percentage of contribution to LMIR Trusts Gross Rent for Forecast Period 2007 . . . . . . . . . . . . . . . . . . . . . . . . . 2.4%
40

Note: (1) Based on Kiosks Sale and Purchase Binding Agreements. (See Business and PropertiesMalang Town Square UnitsRelevant Information relating to the Malang Town Square UnitsTitle.)

Picture of the Malang Town Square Units

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Plaza Madiun Jalan Pahlawan, Madiun, East Java Brief description . . . . . . . . . . . . . . . . Plaza Madiun comprises retail spaces on the basement, first floor, second floor and third floor. Plaza Madiun is currently occupied by Matahari Department Store and Foodmart supermarket. Plaza Madiun is located along Pahlawan Street, a major road of the city. The mall is the biggest in Madiun. Locality information . . . . . . . . . . . . . . The city of Madiun, with a total population of 0.2 million (based on a 2005 census), is the capital city of Madiun regency in the East Java province. The Madiun regency has a total land area of 1,011 sq km and its population exceeds 0.6 million (based on a 2001 census). Madiun has benefited from its position which connects major cities in Central and East Java. It is the home of Indonesias first and largest train manufacturer and is a major sugar producer in Java. The industrial sector and trade, hotel and restaurant businesses are key revenue generators for the city, having contributed around 27.0% and 20.0%, respectively, to Madiuns GRDP (based on economic statistics in 2004). Plaza Madiun is located along Jalan Pahlawan, a major road of the city which is also the primary thoroughfare in the city of Madiun. The street is positioned in the centre of the commercial and administrative zone, at the crossroad of three existing subdistricts of Madiun. Most of the prominent buildings in Madiun are included in this precinct, including the City Hall, Merdeka Hotel, Tentara Hospital and Pasaraya Shopping Centre. Jalan Pahlawan is accessible from Jalan Sudirman, another major thoroughfare in the city. Plaza Madiun enjoys high pedestrian traffic from Jalan Pahlawan and is in close proximity to various forms of public transportation options. Title . . . . . . . . . . . . . . . . . . . . . . . . . . Plaza Madiun was built on a plot of land covering an area of: (i) 5,501 sq m with HGB Certificate No. 186/Kelurahan Pangongangan dated 3 June 1997, registered under the name of Matahari and will expire on 10 February 2012; and

(ii) 82 sq m with HGB Certificate No. 188/Kelurahan Pangongangan dated 12 February 1998, registered under the name of Matahari and will expire on 10 February 2012. Both HGB titles are extendable for another 20 years. Following the expiration of this additional term, a renewal application may be made. (See Overview of Relevant Laws and Regulations in IndonesiaRights to Own and/or to UseHak Guna Bangunan (HGB/Right to Build).) (See Business and PropertiesPlaza Madiun.) Year of building completion . . . . . . . . Appraised value by Knight Frank as at 30 June 2007 . . . . . . . . . . . . . . . . . .
42

2000 S$33.4 million

Appraised value by Colliers as at 30 June 2007 . . . . . . . . . . . . . . . . . . NLA as at 30 June 2007 . . . . . . . . . . NPI for Forecast Period 2007, Projection Year 2008 and Projection Year 2009 (S$000) . . . . . . . . . . . . . .

S$31.8 million 19,029 sq m

Forecast Period 20071,081 Projection Year 20082,228 Projection Year 20092,264

Percentage of contribution to LMIR Trusts Gross Rent for Forecast Period 2007 . . . . . . . . . . . . . . . . . . . . . . . . . 3.1%

Picture of Plaza Madiun

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Grand Palladium Medan Units Jalan Kapt. Maulana Lubis, Medan, North Sumatra Brief description . . . . . . . . . . . . . . . . The Grand Palladium Medan Units comprise four strata units in part of the basement, lower ground floor, upper ground floor, first floor and third floor of Grand Palladium Medan. The Grand Palladium Medan Units are currently occupied by Hypermart, Matahari Department Store and Timezone. Locality information . . . . . . . . . . . . . . Medan, the provincial capital of North Sumatra, is the largest city in Sumatra and the third most populous city in Indonesia after Jakarta and Surabaya. It is a cosmopolitan city with a population of over 2.0 million. Medan is a growing commercial centre in the region, mainly with agriculture and industry businesses. The city was transformed from a tobacco plantation village in the 19th century to a major government and commercial centre at present. Grand Palladium Medan is conveniently located within the Medan CBD and is only 2.5 km from the Polonia International Airport. The mall is located in the centre of Medan, hence drawing shoppers from all around the city. It is surrounded by government and business offices and the town hall, and therefore benefits from regular crowds of government and business visitors. Title . . . . . . . . . . . . . . . . . . . . . . . . . . The Grand Palladium Medan Units are constructed on HGB titles and are currently exclusively controlled by Matahari pursuant to Kiosks Sale and Purchase Binding Agreement No. 011/UPI-PPJB/IX/04, dated 14 September 2004 between Matahari and PT Unitech Prima Indah. This Kiosks Sale and Purchase Binding Agreement is evidence of the parties intention to effect the sale and purchase of strata units, but does not have the effect of transferring ownership. The strata titles are in the process of being issued by the local land office. Upon issuance, the strata titles will be purchased by the relevant Retail Space Indonesian SPC. (See Business and PropertiesGrand Palladium Medan Units.) Year of building completion . . . . . . . . Appraised value by Knight Frank as at 30 June 2007 . . . . . . . . . . . . . . . . . . Appraised value by Colliers as at 30 June 2007 . . . . . . . . . . . . . . . . . . NLA as at 30 June 2007 . . . . . . . . . . NPI for Forecast Period 2007, Projection Year 2008 and Projection Year 2009 (S$000) . . . . . . . . . . . . . . 2005

S$26.2 million

S$25.2 million 13,417 sq m(1)

Forecast Period 2007886 Projection Year 20081,829 Projection Year 20091,859

44

Percentage of contribution to LMIR Trusts Gross Rent for Forecast Period 2007 . . . . . . . . . . . . . . . . . . . . . . . . . 2.6% Note: (1) Based on Kiosks Sale and Purchase Binding Agreements. (See Business and PropertiesGrand Palladium Medan UnitsRelevant Information relating to the Grand Palladium Medan UnitsTitle.)

Picture of the Grand Palladium Medan Units

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STRUCTURE OF LMIR TRUST The following diagram illustrates the relationships among LMIR Trust, the Manager, the Trustee, the Master Lessee, the Singapore SPCs, the Indonesian SPCs, the Operating Companies, the Property Manager and the Unitholders as at the Listing Date.

Unitholders

Singapore
Holding of Units Management fees LMIR Trust Management services Trustees fees Distributions Acts on behalf of Unitholders

Lippo-Mapletree Indonesia Retail Trust Management Ltd. (the Manager)

HSBC Institutional Trust Services (Singapore) Limited (the Trustee)

Ownership of ordinary and redeemable preference shares(2)

Dividends and/or redemption proceeds(2)

Dividends and /or redemption proceeds(2)

Ownership of ordinary and redeemable preference shares(2)

14 Retail Mall Singapore SPCs(1)

7 Retail Space Singapore SPCs(3)

Indonesia
Ownership and shareholders loans Dividends, interest income and principal repayment of shareholders loans Retail Malls Dividends, interest income and principal repayment of shareholders loans Ownership and shareholders loans

7 Indonesian SPCs(4) 100.0% ownership

Retail Spaces

7 Indonesian SPCs(5) 100.0% ownership

Rental payments

Tenancy agreements Tenancies

Master Lease Agreements

Rental payments

Tenants Master leases

PT. Matahari Putra Prima Tbk (the Master Lessee)

Operating Costs Agreement Operating Companies(6) (the Operating Companies) Property management fees PT. Consulting & Management Services Division (the Property Manager)(8)

Service charge(7)

Property management services

Existing Property Management Agreements

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Notes: (1) These 14 Singapore SPCs (collectively, the Retail Mall Singapore SPCs) comprise the Tier 1 Retail Mall Singapore SPCs and the Tier 2 Retail Mall Singapore SPCs. Seven of these 14 Retail Mall Singapore SPCs (the Tier 1 Retail Mall Singapore SPCs) will be acquired by LMIR Trust on the Listing Date. Each of these Tier 1 Retail Mall Singapore SPCs in turn, wholly-own another Singapore SPC (collectively, the Tier 2 Retail Mall Singapore SPCs). (See Certain Agreements Relating to LMIR Trust and the PropertiesSummary of Ownership Structure of the Retail Malls.) (2) LMIR Trust will own ordinary and redeemable preference shares in, and receive dividends and/or redemption proceeds from, the Tier 1 Retail Mall Singapore SPCs and not from the Tier 2 Retail Mall Singapore SPCs. LMIR Trust will also own ordinary and redeemable preference shares in, and receive dividends and/or redemption proceeds from, the Retail Space Singapore SPCs. (3) These seven Singapore SPCs (collectively, the Retail Space Singapore SPCs) will be acquired by LMIR Trust on the Listing Date. (4) As at the Listing Date, the entire share capital in each of the seven Indonesian SPCs (the Retail Mall Indonesian SPCs) will be owned by two of the 14 Retail Mall Singapore SPCs. Each of the Retail Mall Indonesian SPCs owns one of the seven Retail Malls and receives rental payments from the tenants of the respective Retail Mall. (See Certain Agreements Relating to LMIR Trust and the PropertiesSummary of Ownership Structure of the Retail Malls.) (5) The entire share capital in each of these seven Indonesian SPCs (the Retail Space Indonesian SPCs) is owned by two of the seven Retail Space Singapore SPCs. Each of these Retail Space Indonesian SPCs will acquire one of the seven Retail Spaces from Matahari on the Listing Date and will, pursuant to the terms of the Master Lease Agreements, lease it to Matahari, as the Master Lessee, in consideration for rental payments from the Master Lessee. (6) The Operating Companies comprise PT Multi Nusantara Karya, PT Selaras Maju, PT Sarana Karya Megah, PT Antara Nusa Permai, PT Primatama Kreasi Bersama and PT Kharisma Abadi Selaras. (7) A service charge for the expenses incurred during each lease agreement shall be payable by each tenant to the relevant Operating Company for three years commencing from 1 January 2007. (8) A fee for property management services in respect of the Retail Malls shall be payable to the Property Manager for an initial term of four years from the date of the relevant Existing Property Management Agreement. (See Certain Fees and Charges.) The Manager: Lippo-Mapletree Indonesia Retail Trust Management Ltd. The Manager was incorporated in Singapore under the Companies Act, Chapter 50 of Singapore (the Companies Act) on 3 May 2007. As at the Listing Date, it has a paid-up capital of S$1.0 million and its registered office is located at 78 Shenton Way, #05-01 Lippo Centre, Singapore 079120. The Manager is 40.0% owned by Mapletree Capital and 60.0% owned by Peninsula Investment Ltd. Peninsula Investment Ltd is in turn 100.0% owned by Jesselton Investment Ltd, a wholly-owned subsidiary of the Sponsor. Mapletree Capital, a wholly-owned subsidiary of MIPL, is a private limited company incorporated in Singapore under the Companies Act on 6 October 2004. As at 30 June 2007, it has a paid-up capital of S$2.00 and its registered office is located at 1 Maritime Square, #13-01 HarbourFront Centre, Singapore 099253. MIPL is a leading Asia-focused real estate company based in Singapore. The Mapletree Group has an asset base of approximately S$4.5 billion (as at 30 June 2007) comprising office, logistics, industrial, residential and retail/lifestyle properties. (See StrategyAcquisition Growth StrategyLMIR Trusts relationship with the Mapletree Group.) The board of directors of the Manager (the Board) is made up of individuals with a broad range of commercial experience and expertise in areas including, but not limited to, law, accounting, banking, finance, real estate and fund management. The Board consists of Mr Tan Bar Tien, Mr Lim Ho Seng, Mr Lok Vi Ming, Ms Viven G. Sitiabudi, Mr Yeo Cheow Tong, Mr Tan Boon Leong and Mr Wong Mun Hoong. Generally, the Manager will provide the following services to LMIR Trust: Investment strategy. Formulate and execute LMIR Trusts investment strategy, including determining the location, sub-sector type and other characteristics of LMIR Trusts property portfolio. Acquisitions and divestments. Make recommendations to the Trustee on the acquisition and divestment of properties.
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 Strategic asset planning and reporting. Formulate strategic asset/property plans, including asset enhancement initiatives, marketing plans, budgets and reports, relating to the performance of LMIR Trusts properties. Financing. Formulate plans for equity and debt financing for LMIR Trusts property acquisitions, distribution payments, expense payments and property maintenance payments. Administrative and advisory services. Perform day-to-day operational services as LMIR Trusts representative, including providing administrative services relating to meetings of Unitholders when such meetings are convened. Investor relations. Communicate and liaise with Unitholders, media and investment community. Compliance management. Make all regulatory filings on behalf of LMIR Trust and ensure that LMIR Trust is in compliance with the applicable provisions of the Securities and Futures Act and all other relevant legislation, the Listing Manual, the Code on Collective Investment Schemes (including the Property Funds Guidelines) of Singapore (the CIS Code), the Trust Deed, any tax ruling and all relevant contracts. Accounting records. reports. Maintain books and prepare or cause to be prepared accounts and annual

(See The Manager and Corporate GovernanceThe Manager of LMIR Trust.) The Managers key objectives are to deliver regular and stable distributions to Unitholders and to achieve long-term growth in the NAV per Unit in order to maximise Unitholders return. The Manager plans to achieve its key objectives through the following: Acquisition growth strategy LMIR Trusts acquisition growth strategy envisages investments in retail and/or retail-related assets that are in the interests of Unitholders. The assets in LMIR Trusts initial portfolio are all located in Indonesia. LMIR Trust has the principal investment objective of owning and investing on a long-term basis in a diversified portfolio of income-producing real estate in Indonesia that are primarily used for retail and/or retail-related purposes, and real estate related assets in connection with the foregoing. LMIR Trust will benefit from the Sponsors ability to identify and enhance under-valued retail properties and leverage its extensive retail network in Indonesia. LMIR Trust will also benefit from the track record of the Mapletree Group, with its experience in managing yield-accretive assets in various markets such as Mapletree Logistics Trust (MapletreeLog) and other private real estate funds in Asia. The Mapletree Groups total assets under management as at 31 March 2007 is S$1.7 billion. Active asset enhancement and management strategy Implementing pro-active measures to enhance returns from existing and future properties in LMIR Trusts portfolio. Such measures may include addition and alteration works, including re-zoning, tenancy remixing and work carried out for the purpose of expanding size and capacity (in relation to properties to be acquired by LMIR Trust), leveraging and enhancing the properties competitive strengths to optimise rentals and enhancement projects to maintain the competitive positioning of such properties. The Manager will work with the relevant Indonesian authorities to obtain the necessary approvals to undertake such active asset enhancement works. (See Key Investment HighlightsPotential for growth through active asset management and tenant remixing.) Capital and Risk Management Strategy While LMIR Trust will not be drawing down on the Debt Facilities as at the Listing Date, to the extent that LMIR Trust incurs borrowings in the future, the Manager will employ an appropriate mix of debt and equity in the financing of future acquisitions. The Manager has a policy to undertake foreign exchange hedging of the expected distributions of LMIR Trust to insulate against movements in exchange rates (whether favourable or unfavourable). The Trustee, as trustee of LMIR Trust, has entered into a currency hedging arrangement, effective as of the Listing Date, to optimise risk-adjusted returns to the Unitholders as at Listing Date.
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(See StrategyCapital and Risk Management Strategy.) The Master Lessee: PT. Matahari Putra Prima Tbk The Master Lessee, Matahari, is a publicly listed company on the JSX and the Surabaya Stock Exchange (the SSX). It is Indonesias largest retailer by sales revenue with over Rp. 8,487.7 billion (approximately S$1,436.0 million) in annual sales for the financial year ended 31 December 2006. This is a 22.7% increase compared to the Mataharis annual sales of Rp. 6,916.1 billion (approximately S$1,170.6 million) for the financial year ended 31 December 2005. Matahari is listed on the JSX and the SSX with a market capitalisation of Rp. 3,628.2 billion (approximately S$582.9 million) on the JSX as at 18 October 2007. As at 30 June 2007, Matahari operated 83 department stores, 9 Kids2kids specialty stores, 30 hypermarkets, 36 supermarkets and 96 Timezone amusement centres, in addition to 36 Boston drugstores located within Hypermart and/or Matahari supermarkets, all of which are located throughout Indonesia. Matahari was controlled by the Darmawan family until 1997, when the Lippo Group acquired a controlling interest through PT Multipolar Corporation Tbk. The Sponsor: PT. Lippo Karawaci Tbk PT. Lippo Karawaci Tbk is an internationally recognised corporation and is also the largest listed property developer in Indonesia, based on its market capitalisation on the JSX, of Rp. 10,609.2 billion (approximately S$1.8 billion) and on the closing price per ordinary share on the JSX of Rp. 1,790.0 as at 18 October 2007. The Sponsors property portfolio comprises townships and residential developments and commercial and retail development properties. (See The Sponsor.) The Trustee: HSBC Institutional Trust Services (Singapore) Limited HSBC Institutional Trust Services (Singapore) Limited is a company incorporated in Singapore and registered as a trust company under the Trust Companies Act 2005, Chapter 336 of Singapore, with its place of business located at 21 Collyer Quay, #14-01 HSBC Building, Singapore 049320. The Trustees powers and duties include: acting as trustee of LMIR Trust; holding the properties of LMIR Trust for the benefit of the Unitholders; and exercising all the powers of a trustee and the powers accompanying ownership of the properties of LMIR Trust. (See The Formation and Structure of LMIR TrustThe Trust DeedThe Trustee.) Singapore SPCs: the Tier 1 Retail Mall Singapore SPCs, Tier 2 Retail Mall Singapore SPCs and the Retail Space Singapore SPCs On the Listing Date, LMIR Trust will, pursuant to the terms of the Singapore SPC Share Purchase Agreements, complete the acquisition of all of the ordinary shares and redeemable preference shares in each of the Tier 1 Retail Mall Singapore SPCs and the Retail Space Singapore SPCs (collectively, the Target Singapore SPCs) from the Vendors. Each of the seven Retail Mall Indonesian SPCs is owned by a Tier 1 Retail Mall Singapore SPC and a Tier 2 Retail Mall Singapore SPC (wholly-owned by the relevant Tier 1 Retail Mall Singapore SPC), while each of the seven Retail Space Indonesian SPCs is owned by two of the Retail Space Singapore SPCs. The Retail Mall Singapore SPCs comprise two tiers whereas the Retail Space Singapore SPCs comprise one tier. The difference in the holding structures of the Retail Mall Singapore SPCs and the Retail Space Singapore SPCs is due to the fact that the majority of the Retail Malls were owned by different parties while all of the Retail Spaces were owned by the same party. The use of the two-layer structure for the Retail Malls is used to simplify the acquisition by LMIR Trust on the Listing Date.
49

The table below shows the corresponding Vendor for each of the Target Singapore SPCs whose ordinary shares and redeemable preference shares will be acquired by LMIR Trust upon completion of the Singapore SPC Share Purchase Agreements:
Vendor Tier 1 Retail Mall Singapore SPCs

Dellmore Investment Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Market Holdings Ltd. . . . . . . . . Victoria Investment Ltd. . . . . . . Millennium Capital Ltd. . . . . . . Golden Acres Investment Ltd. . Superior Asset Investment Ltd. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Belilios International Pte. Ltd. Dominion Capital Pte. Ltd. Greenlot Investments Pte. Ltd. Tangent Investments Pte. Ltd. Magnus Investments Pte. Ltd. Thornton Investments Pte. Ltd. Pierbridge Investments Pte. Ltd.

(See Certain Agreements Relating to LMIR Trust and the PropertiesSummary of Ownership Structure of the Retail Malls.)
Vendor Retail Space Singapore SPCs

Tristar Capital Ltd. (Tristar) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Serpong Properties Pte. Ltd. Metropolis Properties Pte. Ltd. Matos Properties Pte. Ltd. Detos Properties Pte. Ltd. Palladium Properties Pte. Ltd. Java Properties Pte. Ltd. Madiun Properties Pte. Ltd.

(See Certain Agreements Relating to LMIR Trust and the PropertiesSummary of Ownership Structure of the Retail Spaces.) All the Vendors, with the exception of Tristar, are not related to the Sponsor or the Manager. (See Certain Agreements Relating to LMIR Trust and the PropertiesDescription of the Singapore SPC Share Purchase Agreements.) Indonesian SPCs: the Retail Mall Indonesian SPCs and the Retail Space Indonesian SPCs Retail Mall Indonesian SPCs: PT Graha Baru Raya, PT Graha Nusa Raya, PT Cibubur Utama, PT Megah Semesta Abadi, PT Suryana Istana Pasundan, PT Indah Pesona Bogor, PT Primatama Nusa Indah Under the terms of each Retail Mall Indonesian SPC Share Purchase Agreement, each of the seven Retail Mall Indonesian SPCs will, on the Listing Date, be acquired by two of the 14 Retail Mall Singapore SPCs. The Retail Mall Indonesian SPCs lease the Retail Malls to tenants in consideration for rental payments from the tenants under lease agreements. As at Listing Date, the Retail Mall Indonesian SPCs will already hold the Retail Malls. As a result, upon completion of its purchase of the 14 Retail Mall Singapore SPCs, on the Listing Date, LMIR Trust will also indirectly own the seven Retail Malls. Retail Space Indonesian SPCs: PT Dinamika Serpong, PT Gema Metropolis Modern, PT Matos Surya Perkasa, PT Megah Detos Utama, PT Palladium Megah Lestari, PT Madiun Ritelindo, PT Java Mega Jaya Under the terms of each Retail Space Indonesian SPC Share Purchase Agreement, each of the seven Retail Space Indonesian SPCs will, on the Listing Date, be acquired by two of the seven Retail Space Singapore SPCs. Under the terms of each Property Purchase Agreement, each of the seven Retail Space Indonesian SPCs, which is owned by two of the seven Retail Space Singapore SPCs will, on the Listing Date, complete the acquisition of one of the seven Retail Spaces from Matahari. As a result, upon completion of its purchase of the seven Retail Space Singapore SPCs on the Listing Date, LMIR Trust will also indirectly own the seven Retail Spaces. The Retail Space Indonesian SPCs will lease the Retail Spaces to the Master Lessee in consideration for rental payments from the Master Lessee under each of the Master Lease Agreements.
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Operating Companies: PT Multi Nusantara Karya, PT Selaras Maju, PT Sarana Karya Megah, PT Antara Nusa Permai, PT Primatama Kreasi Bersama and PT Kharisma Abadi Selaras Pursuant to each of the operating costs agreements entered into between the relevant Retail Mall Indonesian SPC and Operating Company (collectively, the Operating Costs Agreements), each Operating Company has the right to collect, through the Property Manager, a service charge from the tenants of the relevant Retail Mall. The Operating Companies will utilise this service charge to cover the costs directly related to the maintenance and operation of the Retail Malls. The Operating Costs Agreements will be valid for a period of three years commencing 1 January 2007. Each of the Operating Companies is an affiliate of the respective Vendor of the relevant Retail Mall. The table below shows the corresponding Operating Company for each Retail Mall:
Retail Mall Operating Company

Gajah Mada Plaza . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Cibubur Junction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . The Plaza Semanggi. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Mal Lippo Cikarang . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Ekalokasari Plaza . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Bandung Indah Plaza . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Istana Plaza . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . .

PT Multi Nusantara Karya PT Selaras Maju PT Primatama Kreasi Bersama PT Multi Nusantara Karya PT Sarana Karya Megah PT Antara Nusa Permai PT Kharisma Abadi Selaras

Property Manager: PT. Consulting & Management Services Division The Property Manager, a wholly-owned subsidiary of the Sponsor, was incorporated in Indonesia on 23 March 2006. Its registered office is located at Lippo Cyber Park, 2121 Lippo Karawaci Utara, Tangerang. Since 2006, the Property Manager has been engaged in the business of managing properties in Indonesia. The Property Manager has entered into a property management agreement with each of the Retail Mall Indonesian SPCs holding the relevant Retail Mall (collectively the Existing Property Management Agreements) under which the Property Manager will provide, among other things: retail management services for the relevant Retail Mall including advising and developing a strategic management policy for tenants and service providers, reviewing and implementing human resources policies, accounting and finance procedures, maintenance, safety, security, cleaning and parking for the relevant Retail Mall, reviewing and providing input on vehicular and pedestrian flows and customer conveniences, public relations and customer services, insurance and tenancy mix policies; advertising and promotion services; lease documentation and monitoring systems and a management reporting system; and building documentation system. (See Certain Agreements Relating to LMIR Trust and the PropertiesDescription of Existing Property Management Agreements.)

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Certain fees and charges The following is a summary of the amounts of certain fees and charges payable by the Unitholders in connection with the subscription for the Units (so long as the Units are listed):
Payable by the Unitholders directly Amount payable

(a) (b) (c) (d)

Subscription fee or preliminary charge . . Realisation fee . . . . . . . . . . . . . . . . . . . . Switching fee . . . . . . . . . . . . . . . . . . . . . Any other fee . . . . . . . . . . . . . . . . . . . . .

. . . .

N.A.(1) N.A.(1) N.A.(1) Clearing fee for trading of Units on the SGX-ST at the rate of 0.04% of the transaction value, subject to a maximum of S$600.00 per transaction.

Note: (1) As the Units will be listed and traded on the SGX-ST and Unitholders will have no right to request the Manager to redeem their Units while the Units are listed, no subscription fee, preliminary charge, realisation fee or switching fee is payable in respect of the Units. The following is a summary of certain fees and charges payable by LMIR Trust in connection with the establishment and ongoing management and operation of LMIR Trust:
Payable by LMIR Trust Amount payable

(a) Management fees . . . . . . . . . . . .

Base Fee 0.25% per annum of the value of the Deposited Property. Performance Fee 4.0% per annum of LMIR Trusts NPI in the relevant financial year (calculated before accounting for this additional fee in that financial year). Authorised Investment Management Fee 0.5% per annum of the value of Authorised Investments which are not real estate (whether held directly by LMIR Trust or indirectly through one or more Special Purpose Vehicles (SPVs)). Where such Authorised Investment is an interest in a property fund (either a REIT or private property fund) wholly managed by a wholly-owned subsidiary of the Sponsor, no Authorised Investment Management Fee shall be payable in relation to such Authorised Investment. Management Fee to be paid in cash or Units The Manager may elect to receive the management fees in cash or Units or a combination of cash and Units (as it may in its sole discretion determine). For Forecast Period 2007, Projection Year 2008 and Projection Year 2009, the Manager has opted to receive 100% of the Performance Fee in the form of Units. (See The Manager and Corporate GovernanceManagement Fees.)

(b) Trustees fee . . . . . . . . . . . . . . . .

A maximum of 0.03% per annum of the value of the Deposited Property, subject to a minimum of S$15,000 per month, excluding out-of-pocket expenses and GST. LMIR Trust will also pay the Trustee a one-time inception fee of S$25,000. The Trustees fee will be subject to review three years from the Listing Date.

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Payable by LMIR Trust

Amount payable

(c) Any other substantial fee or charge (i.e. 0.1% or more of LMIR Trusts asset value) (i) Acquisition fee (payable to the Manager) . . . . . . . . . . . . . . . . . For any Authorised Investment acquired directly or indirectly from time to time by the Trustee on behalf of LMIR Trust, the acquisition fee payable to the Manager shall be 1.0% of the purchase price of such Authorised Investment acquired by LMIR Trust. No acquisition fee is payable for the acquisition of the initial property portfolio of LMIR Trust. The acquisition fee is payable to the Manager in the form of cash and/or Units (as the Manager may elect in its sole discretion) at the then prevailing market price provided that in respect of any acquisition of real estate assets from interested parties, such a fee should, if required by the applicable laws, rules and/or regulations, be in the form of Units issued by LMIR Trust at prevailing market price(s) and subject to such transfer restrictions as may be imposed. At present, the Property Funds Guidelines prescribe that such Units should not be sold within one year from the date of their issuance. Any payment to third party agents or brokers in connection with the acquisition of any Authorised Investment for LMIR Trust shall be paid by the Manager to such persons out of the Deposited Property of LMIR Trust or the assets of the relevant SPV, and not out of the acquisition fee or the divestment fee received or to be received by the Manager. (ii) Divestment fee (payable to the Manager) . . . . . 0.5% of the sale price (after deducting the interest of any coowners or co-participants) of any Authorised Investment directly or indirectly sold or divested from time to time by the Trustee on behalf of LMIR Trust. The divestment fee is payable to the Manager in the form of cash and/or Units (as the Manager may elect in its sole discretion) at the then prevailing market price provided that in respect of any sale or divestment of real estate assets to interested parties, such a fee should, if required by the applicable laws, rules and/or regulations, be in the form of Units issued by LMIR Trust at prevailing market price(s) and subject to such transfer restrictions as may be imposed. At present, the Property Funds Guidelines prescribe that such Units should not be sold within one year from the date of their issuance. Any payment to third party agents or brokers in connection with the sale or divestment of any Authorised Investment for LMIR Trust shall be paid by the Manager to such persons out of the Deposited Property of LMIR Trust or the assets of the relevant SPV, and not out of the acquisition fee or the divestment fee received or to be received by the Manager. (iii) Property Managers fee (payable to the Property Manager) . . . . . . . . . . . . . . . . . .

Under the Existing Property Management Agreements in respect of each Retail Mall, the Property Manager will provide retail management services, advertising and promotion
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Payable by LMIR Trust

Amount payable

services, lease documentation and monitoring systems, and a building documentation system in relation to that Retail Mall. The Property Manager is entitled to the following fees: 2.0% per annum of the gross revenue for the relevant Retail Mall; 2.0% per annum of the net property income for the relevant Retail Mall (after accounting for the fee of 2.0% per annum of the gross revenue for the relevant Retail Mall); and 0.5% per annum of the net property income for the relevant Retail Mall in lieu of leasing commissions otherwise payable to the Property Manager and/or third party agents. It is currently intended that the same fees will be paid to the Property Manager under the Master Property Management Agreement for any other properties to be acquired by LMIR Trust after the Listing Date and managed by the Property Manager. In relation to Authorised Investments in the form of real estate owned or held, or to be owned or held, either directly or indirectly, by a SPV, the fees payable to the Manager shall be calculated on the same basis as if such real estate, or the pro-rated share of such real estate in the case where the interest of LMIR Trust in the SPV is partial, had been held directly by the Trustee.

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The offering
LMIR Trust . . . . . . . . . . . . . . . . . . . . The Manager . . . . . . . . . . . . . . . . . . . The Trustee . . . . . . . . . . . . . . . . . . . . The Sponsor . . . . . . . . . . . . . . . . . . . The Master Lessee . . . . . . . . . . . . . . Lippo-Mapletree Indonesia Retail Trust, a REIT established in the Republic of Singapore and constituted by the Trust Deed. Lippo-Mapletree Indonesia Retail Trust Management Ltd. HSBC Institutional Trust Services (Singapore) Limited. PT. Lippo Karawaci Tbk. PT. Matahari Putra Prima Tbk. The Master Lessee is a publicly listed company on the JSX and the SSX, and was controlled by the Darmawan family until 1997, when the Lippo Group acquired, and still retains, a controlling interest through PT Multipolar Corporation Tbk. The Vendors . . . . . . . . . . . . . . . . . . . Golden Acres Investment Ltd., Market Holdings Ltd., Millennium Capital Ltd., Superior Asset Investment Ltd., Victoria Investment Ltd., Dellmore Investment Ltd and Tristar, companies incorporated in the Federal Territory of Labuan, Malaysia. Tristar is a wholly-owned subsidiary of Matahari. The Vendors, with the exception of Tristar, are not owned, whether wholly or partially, directly or indirectly, by the Sponsor. Lippo Strategic and Mapletree LM. Lippo Strategic has also granted the Stabilising Manager the Over-allotment Option. Lippo Strategic. 645,469,000 Units offered under the Placement and the Public Offer, subject to the Over-allotment Option. 625,469,000 Units offered by way of an international placement to investors, including institutional and other investors in Singapore. The Units have not been and will not be registered under the Securities Act and, subject to certain exceptions, may not be offered or sold within the United States. The Units are being offered and sold only outside the United States (including to institutional and other investors in Singapore) in reliance on Regulation S. The Public Offer . . . . . . . . . . . . . . . . Clawback and Re-allocation . . . . . . . 20,000,000 Units offered to the public in Singapore. The Units may be re-allocated between the Placement and the Public Offer at the discretion of the Underwriters (subject to the minimum unitholding and distribution requirements of the SGXST), such as in the event of an excess of applications in one and a deficit of applications in the other. Separate from the Offering, Lippo Strategic and Mapletree LM have subscribed for an aggregate of 287,695,000 Units and 127,250,000 Units respectively at the Offering Price under Cornerstone Subscription Agreements, subject to certain conditions, including that the Underwriting Agreement has been entered into and shall not have been terminated pursuant to its terms on or prior to the Listing Date. The Cornerstone Units will in aggregate constitute approximately 39.1% of the total issued Units as at the Listing Date (assuming no exercise of the Over-allotment Option). The Offering is conditional upon the completion of subscription of the Cornerstone Units by each of the Cornerstone Investors.
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Cornerstone Investors . . . . . . . . . . . . The Unit Lender . . . . . . . . . . . . . . . . . The Offering . . . . . . . . . . . . . . . . . . . The Placement . . . . . . . . . . . . . . . . .

Cornerstone Units . . . . . . . . . . . . . . .

Subscription for the Public Offer . . . .

Investors applying for Units by way of Application Forms or Electronic Applications (both as referred to in Appendix G Terms, Conditions and Procedures for Application for and Acceptance of the Units in Singapore) in the Public Offer will pay the Offering Price on application, subject to a refund of the full amount or, as the case may be, the balance of the application monies (in each case, without interest or any share of revenue or other benefit arising therefrom) where (i) an application is rejected or accepted in part only, or (ii) the Offering does not proceed for any reason. For the purpose of illustration, an investor who applies for 1,000 Units by way of an Application Form or an Electronic Application under the Public Offer will have to pay S$800.00, which is subject to a refund of the full amount or the balance thereof (without interest or any share of revenue or other benefit arising therefrom), as the case may be, upon the occurrence of any of the foregoing events. The minimum initial subscription is for 1,000 Units. An applicant may subscribe for a larger number of Units in integral multiples of 1,000. Investors in Singapore must follow the application procedures set out in Appendix GTerms, Conditions and Procedures for Application for and Acceptance of the Units in Singapore. Subscriptions under the Public Offer must be paid for in Singapore dollars. No fee is payable by applicants for the Units, save for an administration fee of S$1.00 for each application made through ATMs of the Participating Banks.

Offering Price . . . . . . . . . . . . . . . . . . Over-allotment Option . . . . . . . . . . . .

S$0.80 per Unit. In connection with the Offering, the Stabilising Manager (on behalf of the Underwriters) has been granted the Over-allotment Option by the Unit Lender. The Over-allotment Option is exercisable by the Stabilising Manager, in consultation with the other Underwriters, in full or in part, on one or more occasions, no later than the earliest of (i) the date falling 30 days from the commencement of trading of the Units on the SGX-ST, (ii) the date when the Stabilising Manager has bought on the SGX-ST, an aggregate of 96,820,000 Units, representing not more than 15.0% of the total Units offered, to undertake stabilising actions or (iii) the date falling 30 days after the date of adequate public disclosure of the final price of the Units, to purchase from the Unit Lender up to an aggregate of 96,820,000 Units at the Offering Price, solely to cover the overallotment of Units (if any) subject to any applicable laws and regulations. The total number of outstanding Units immediately after the completion of the Offering, including the Cornerstone Units, will be 1,060,414,000 Units. The exercise of the Overallotment Option will not increase this total number of Units outstanding. The total number of Units subject to the Overallotment Option will not exceed more than 9.1% of the total number of Units under the Offering. In connection with the Offering, the Stabilising Manager (or persons acting on behalf of the Stabilising Manager) may, in consultation with the other Underwriters, over-allot or effect transactions which stabilise or maintain the market price of the Units at levels which might not otherwise prevail in the open market. Such transactions may be effected on the SGXST and in other jurisdictions where it is permissible to do so; in

Stabilisation. . . . . . . . . . . . . . . . . . . .

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each case, in compliance with all applicable laws and regulations, including the SFA, and any regulations thereunder. However, there is no assurance that the Stabilising Manager (or persons acting on behalf of the Stabilising Manager) will undertake stabilisation action. Such transactions may commence on or after the date of commencement of trading in the Units on SGX-ST and, if commenced, may be discontinued at any time and shall not be effected after the earliest of (i) the date falling 30 days from the date of commencement of trading of the Units on the SGXST, (ii) the date when the Stabilising Manager has bought on the SGX-ST an aggregate of 96,820,000 Units, representing not more than 15.0% of the total Units offered to undertake stabilising actions or (iii) the date falling 30 days after the date of adequate public disclosure of the final price of the Units. (See Plan of DistributionOver-allotment and Stabilisation.) Lock-ups . . . . . . . . . . . . . . . . . . . . . . Lippo Strategic (also the Unit Lender), Lippo Holdings Inc, Lippo Capital Limited, Lippo Cayman Limited, Lanius Ltd, MIPL, Mapletree Dextra Pte Ltd and Mapletree LM on 9 November 2007 have each agreed to (i) a lock-up arrangement in respect of their direct or indirect interests (as the case may be) in the Cornerstone Units, as at the Listing Date during the First Lock-Up Period and (ii) a lock-up arrangement in respect of their direct or indirect interests (as the case may be) in 50.0% of the Cornerstone Units as at the Listing Date during the Second Lock-Up Period, subject to certain exceptions. The Manager has also on 9 November 2007 agreed to a lock-up arrangement in respect of any offer, issue or contract to issue any Units, and the making of any announcements in connection with any offer, issue or contract to issue any Units during the First Lock-Up Period, subject to certain exceptions. (See Plan of DistributionLock-up Arrangements.) Capitalisation. . . . . . . . . . . . . . . . . . . Use of Proceeds . . . . . . . . . . . . . . . . S$963.3 million Capitalisation). (based on the Offering Price) (see

Based on the Offering Price and estimated issue costs of the Offering, the gross proceeds from the Offering, assuming that the Over-allotment Option has not been exercised, are estimated to be approximately S$848.3 million. The Manager intends to apply the total proceeds from the Offering and from the issuance of Cornerstone Units towards the following: (i) payment of the purchase consideration to the Vendors for the acquisition of all of the ordinary shares and redeemable preference shares in the Target Singapore SPCs at completion under the Singapore SPC Share Purchase Agreements; and (ii) costs and expenses related to the Offering and the issuance of the Cornerstone Units. (See Use of Proceeds and Certain Agreements Relating to LMIR Trust and the Properties.)

Unitholders Meetings . . . . . . . . . . . .

The Manager and the Trustee may (and the Manager shall at the request in writing of not less than 50 Unitholders or the Unitholders with not less than one-tenth in number of issued
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Units, whichever is the lesser) at any time convene a meeting of Unitholders in accordance with the provisions of the Trust Deed. No Redemption by Unitholders . . . . . Unitholders have no right to request the Manager to redeem their Units while the Units are listed. It is intended that Unitholders may only deal in their listed Units through trading on the SGX-ST. Listing of the Units on the SGXST does not guarantee a liquid market for the Units. LMIR Trusts distribution policy is to distribute 100.0% of its taxexempt income (after deduction of applicable expenses) and capital receipts for Forecast Period 2007, Projection Year 2008 and Projection Year 2009 and at least 90.0% of its tax-exempt income (after deduction of applicable expenses) and capital receipts thereafter. Distributions will be paid on a quarterly basis to Unitholders, except for the first distribution, which will be paid for the period from the Listing Date to 31 March 2008 and will be paid by the Manager on or before 30 May 2008 (see Distributions). Unitholders will be exempt from Singapore income tax on distributions made by LMIR Trust out of its tax-exempt income. Unitholders will not be subject to Singapore income tax on distributions made by LMIR Trust out of its capital receipts, comprising amounts received from redemption of redeemable preference shares in the Target Singapore SPCs. These distributions will be treated as returns of capital for Singapore income tax purposes. For Unitholders who hold the Units as trading or business assets and are liable to Singapore income tax on gains arising from disposal of the Units, the amount of such distributions will be applied to reduce the cost of the Units for the purpose of calculating the amount of taxable trading gain when the Units are disposed of. If the amount distributed exceeds the cost or the reduced cost of the Units, as the case may be, the excess will be subject to tax as trading income of such Unitholders (see Taxation). Indonesia Tax Considerations . . . . . . The income received by the Indonesian SPCs solely from rental payments by the Master Lessee and the tenants is subject to final income tax in Indonesia at the rate of 10.0%. The Indonesian SPCs charge value-added tax (VAT) at the rate of 10.0% on the rental income from the Master Lessee and the tenants. The income received by LMIR Trust through the Target Singapore SPCs in the form of dividends and interest payments is subject to tax in Indonesia at the rate of 10.0% based on the provisions of the Singapore-Indonesia tax treaty. The withholding tax on the dividends and interest payments is payable when it is accrued or paid, whichever comes first. Termination of LMIR Trust . . . . . . . . . LMIR Trust can be terminated if the Unitholders approval is obtained by passing a resolution proposed and approved by a majority consisting of 75.0% or more of the total number of votes cast for and against such resolution (an Extraordinary Resolution) at a Unitholders meeting duly convened and held in accordance with the provisions of the Trust Deed. As specified in the Trust Deed, the Manager or the Trustee may terminate LMIR Trust under certain circumstances such as LMIR Trust being delisted permanently from the SGX-ST (see

Distribution Policy . . . . . . . . . . . . . . .

Singapore Tax Considerations . . . . . .

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The Formation and Structure of LMIR TrustThe Trust Deed Termination of LMIR Trust). Listing and Trading . . . . . . . . . . . . . . Prior to the Offering, there has been no market for the Units. Application has been made to the SGX-ST for permission to list on the Main Board of the SGX-ST all the Units comprised in the Offering, all the Cornerstone Units as well as all the Units which may be issued to the Manager from time to time in full or part payment of the Managers management fees, including its acquisition fee and divestment fee (see The Manager and Corporate GovernanceManagement Fees). Such permission will be granted when LMIR Trust is admitted to the Official List of the SGX-ST. The Units will, upon their issue, listing and quotation on the SGXST, be traded in Singapore dollars under the book-entry (scripless) settlement system of The Central Depository (Pte) Limited (CDP). The Units will be traded in board lot sizes of 1,000 Units. Governing Law . . . . . . . . . . . . . . . . . The Trust Deed, pursuant to which LMIR Trust was constituted, is governed by Singapore law. The (i) Deeds of Indemnity, (ii) Singapore SPC Share Purchase Agreements and (iii) Rental Guarantee Deeds are governed by Singapore law while the (i) Master Lease Agreements, (ii) Property Purchase Agreements, (iii) Operating Costs Agreements, (iv) Indonesia SPC Share Purchase Agreements, (v) Master Property Management Agreement and (vi) Existing Property Management Agreements are governed by Indonesian law. Prospective investors should carefully consider certain risks connected with an investment in the Units, as discussed under Risk Factors.

Risk Factors . . . . . . . . . . . . . . . . . . .

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Indicative timetable
An indicative timetable for the Offering is set out below for the reference of applicants for the Units:
Date and time Event

12 November 2007, 9.00 a.m. . . . . . . . . . . . . . . . 15 November 2007, 12 noon . . . . . . . . . . . . . . . . 16 November 2007. . . . . . . . . . . . . . . . . . . . . . . .

19 November 2007, at or before 2.00 p.m. . . . . . 19 November 2007, 2.00 p.m. . . . . . . . . . . . . . . . 22 November 2007. . . . . . . . . . . . . . . . . . . . . . . .

Opening date and time for the Offering. Closing date and time for the Offering. Balloting of applications, if necessary. Commence returning or refunding of application monies to unsuccessful or partially successful applicants. Completion of the acquisition of the Properties. Commence trading on a ready basis. Settlement date for all trades done on a ready basis on 19 November 2007.

The above timetable is indicative only and is subject to change. It assumes (i) that the closing of the application list for the Public Offer (the Application List) is 15 November 2007; (ii) that the Listing Date is 19 November 2007; (iii) compliance with the SGX-STs unitholding spread requirement; and (iv) that the Units will be issued and fully paid up prior to 2.00 p.m. on 19 November 2007. All dates and times referred to above are Singapore dates and times. Trading in the Units through the SGX-ST on a ready basis will commence at 2.00 p.m. on 19 November 2007 (subject to the SGX-ST being satisfied that all conditions necessary for the commencement of trading in the Units through the SGX-ST on a ready basis have been fulfilled), as the completion of the acquisition of the Properties not already owned by LMIR Trust is expected to take place at or before 2.00 p.m. on 19 November 2007 (see Certain Agreements Relating to LMIR Trust and the Properties). If LMIR Trust is terminated by the Manager or the Trustee under the circumstances specified in the Trust Deed prior to, or the acquisition of the Properties is not completed by, 2.00 p.m. on 19 November 2007 (being the time and date of commencement of trading in the Units through the SGX-ST), the Offering will not proceed and the application monies will be returned in full (without interest or any share of revenue or other benefit arising therefrom and at each applicants own risk and without any right or claim against LMIR Trust, the Trustee, the Manager, the Underwriters, the Unit Lender or the Sponsor). In the event of any early or extended closure of the Application List or the shortening or extension of the time period during which the Offering is open, the Manager will publicly announce the same: via SGXNET, with the announcement to be posted on the Internet at the SGX-ST website: http://www.sgx.com; and in one or more major Singapore newspapers, such as The Straits Times, The Business Times and Lianhe Zaobao. Investors should consult the SGX-ST announcement on the ready listing date on the Internet (at the SGX-ST website), InTv or the newspapers, or check with their brokers on the date on which trading on a ready basis will commence. The Manager will provide details and results of the Public Offer through SGXNETand in one or more major Singapore newspapers, such as The Straits Times, The Business Times and Lianhe Zaobao. The Manager reserves the right to reject or accept, in whole or in part, or to scale down or ballot any application for Units, without assigning any reason for it, and no enquiry and/or correspondence on the decision of the Manager will be entertained. In deciding the basis of allotment, due consideration will be given to the desirability of allotting the Units to a reasonable number of applicants with a view to establishing an adequate market for the Units. Where an application is rejected or accepted in part only or if the Offering does not proceed for any reason, the full amount or the balance of the application monies, as the case may be, will be refunded (without interest or any share of revenue or other benefit arising therefrom) to the applicant, at his own risk, and without any right or claim against LMIR Trust, the Trustee, the Manager, the Underwriters, the Sponsor or the Unit Lender. Where an application is not successful, the full amount of the application monies will be refunded (without interest or any share or revenue or other benefit arising therefrom) to the applicant, at his own risk within 24 hours after the balloting of applications (provided that such refunds in relation to applications in
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Singapore are made in accordance with the procedures set out in Appendix GTerms, Conditions and Procedures for Application for and Acceptance of the Units in Singapore). In respect of partially successful applications using printed Application Forms, the balance of the application monies is expected to be refunded (without interest or any share of revenue or other benefit arising therefrom) to applicants by ordinary post at their own risk, within 14 Market Days after the closing date for the Offering, provided that the remittance accompanying such application which has been presented for payment or other processes has been honoured and the application monies received in the designated unit issue account. In respect of partially successful applications via ATM, the balance of the application monies is expected to be refunded (without interest or any share of revenue or other benefit arising therefrom) through the crediting of the relevant amount to the applicants accounts with their Participating Banks, or by ordinary post at their own risk within 14 Market Days after the close of the Offering provided that the remittance accompanying such application which has been presented for payment or other processes has been honoured and the application monies received in the designated unit issue account.

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Profit Forecast and Profit Projection

The following is an extract from Profit Forecast and Profit Projection. Statements in this extract that are not historical facts may be forward-looking statements. Such statements are based on the assumptions set out on pages 100 to 108 of this Prospectus and are subject to certain risks and uncertainties which could cause actual results to differ materially from those forecast and projected. Under no circumstances should the inclusion of such information herein be regarded as a representation, warranty or prediction with respect to the accuracy of the underlying assumptions by LMIR Trust, the Manager, the Underwriters, the Sponsor, the Property Manager, the Trustee, the Financial Adviser or any other person, nor that these results will be achieved or are likely to be achieved. (See Forward-Looking Statements and Risk Factors). Investors in the Units are cautioned not to place undue reliance on these forward-looking statements which are valid only as at the date of this Prospectus. None of LMIR Trust, the Manager, the Financial Adviser, the Underwriters, the Sponsor, the Property Manager, the Trustee and the Unit Lender guarantees the performance of LMIR Trust, the repayment of capital or the payment of any distributions, or any particular return on the Units. The forecast and projected yields stated in the following table are calculated based on (i) the Offering Price, and (ii) the assumption that the Listing Date is 1 July 2007. Such yields will vary accordingly since the Listing Date will be after 1 July 2007 and in relation to investors who purchase Units in the secondary market at a market price that differs from the Offering Price. The following table below sets forth LMIR Trusts forecast and projected consolidated statements of total return for Forecast Period 2007, Projection Year 2008 and Projection Year 2009 respectively. The financial year-end of LMIR Trust is 31 December. For the purpose of the profit forecast and profit projection, LMIR Trusts first accounting period is assumed to be the period from 1 July 2007 to 31 December 2007. The profit forecast and profit projection will be different if the date of establishment differs from 1 July 2007 or if the end of the first financial period differs from 31 December 2007. The profit forecast and profit projection should be read together with the report set out in Appendix AIndependent Accountants Report on the Profit Forecast and Profit Projection as well as the assumptions and the sensitivity analysis set out in Profit Forecast and Profit Projection. The following table sets forth LMIR Trusts forecast and projected Consolidated Statement of Total Return for Forecast Period 2007, Projection Year 2008 and the Projection Year 2009 prepared based on the Offering Price. Forecast and Projected Consolidated Statement of Total Return
Forecast Period 2007 (S$000) Projection Year 2008 (S$000) Projection Year 2009 (S$000)

Gross Revenue Gross Rent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Carpark income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Other income. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Total Gross Revenue . . . . . . . . . . . . . . . . . . . . . . . . . Property Operating Expenses Land rental . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Property management fees . . . . . . . . . . . . . . . . . . . . . Other property operating expenses . . . . . . . . . . . . . . . Total Property Operating Expenses . . . . . . . . . . . . . Net Property Income . . . . . . . . . . . . . . . . . . . . . . . . . Interest income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Financial expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . Administrative expenses Managers management fees. . . . . . . . . . . . . . . . . . . . Trustees fee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Other trust operating expenses . . . . . . . . . . . . . . . . . . Total administrative expenses . . . . . . . . . . . . . . . . .

35,018 3,782 1,346 40,146 (661) (1,475) (461) (2,597) 37,549 789 (201) (2,883) (191) (607) (3,681)

74,660 7,356 2,804 84,820 (1,618) (3,134) (583) (5,335) 79,485 1,157 (365) (5,942) (332) (830) (7,104)

81,632 7,053 2,895 91,580 (1,836) (3,423) (447) (5,706) 85,874 796 (339) (6,198) (332) (848) (7,378)

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Forecast Period 2007 (S$000)

Projection Year 2008 (S$000)

Projection Year 2009 (S$000)

Total return for the period before tax and distribution and revaluation . . . . . . . . . . . . . . . Surplus on the revaluation on investment properties Total return for the period before tax and distribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Income tax . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Withholding tax . . . . . . . . . . . . . . . . . . . . . . . . . . . . Deferred tax . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Total return for the period after tax before distribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

.. .. .. .. .. .. ..

34,456 207,887 242,343 (4,173) (2,893) (62,366) 172,911

73,173 73,173 (8,714) (5,940) 58,519

78,953 78,953 (9,317) (6,520) 63,116

Distribution to Unitholders
Forecast Period 2007 (S$000) Projection Year 2008 (S$000) Projection Year 2009 (S$000)

Total return for the period after tax before distribution . . . Add back/(less) non-cash items: Management fees(1) . . . . . . . . . . . . . . . . . . . . . . . . . . Surplus on revaluation of investment properties net of deferred tax(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Reversal of FRS adjustment on rental deposit(3) . . . . . Total Unitholders distribution . . . . . . . . . . . . . . . . . . . Unitholders distribution: as distributions from operations . . . . . . . . . . . . . . . . . . as return of capital(4) . . . . . . . . . . . . . . . . . . . . . . . . . . Total Unitholders distribution . . . . . . . . . . . . . . . . . . . Notes:

172,911 1,503 (145,521) 201 29,094 23,035 6,059 29,094

58,519 3,180 365 62,064 48,044 14,020 62,064

63,116 3,435 339 66,890 55,487 11,403 66,890

(1) This relates to the portion of the management fees which are payable in the form of Units. (2) It is assumed that all of the Properties are purchased at a total consideration of approximately S$796.8 million based on the Offering Price. The purchase consideration of the Properties is determined by the difference between the purchase consideration of the Singapore SPCs (see Certain Agreements relating to LMIR Trust and the PropertiesDescription of the Singapore SPC Share Purchase Agreements for the formula of determining this purchase consideration) and the fair value of all the net identifiable assets and liabilities of the Singapore SPCs acquired save for the Properties. The surplus on revaluation of the investment properties relates to the revaluation of the Properties to their fair value of S$1,004.7 million immediately upon their acquisition and the capital expenditures expected to be incurred in the Forecast Period 2007. The fair value of S$1,004.7 million is based on the value appraised by Knight Frank as at 30 June 2007. It is assumed that the fair value of the Properties will only increase by the amount of capital expenditure expected to be incurred in the Forecast Period 2007, the Projection Year 2008 and the Projection Year 2009 and that there is no change in the exchange rate between the Singapore dollar and the Indonesian Rupiah as at the end of Forecast Period 2007 and the Projection Year 2008 and the Projection Year 2009. Notwithstanding whether the valuation of Knight Frank or Colliers is adopted, such adoption has no impact on the distribution to Unitholders. (3) This relates to notional interest expense which has no impact on the distribution to Unitholders. (4) The return of capital comprises the amounts received by LMIR Trust from the redemption of its investment in the redeemable preference shares in the Target Singapore SPCs (see Profit Forecast and Profit ProjectionAssumptions(IX) Distributable Income and Distributions).
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Forecast and Projected Distributions to Unitholders

Forecast Period 2007 Based on the Offering Price Projection Year 2008 Based on the Offering Price Projection Year 2009 Based on the Offering Price

Number of Units eligible for distribution (000)(1) . . . Distribution per Unit (cents) . . . . . . . . . . . . . . . . . Offering Price per Unit (S$) . . . . . . . . . . . . . . . . . Distribution yield (%) . . . . . . . . . . . . . . . . . . . .

1,060,414(2) 2.74 0.80 6.9(5)

1,062,291(3) 5.84 0.80 7.3

1,066,266(4) 6.27 0.80 7.8

Notes: (1) The increase in the number of Units in Projection Year 2008 and Projection Year 2009 are due to the issue of Units to the Manager for the payment of 100.0% of the Managers Performance Fees for Forecast Period 2007 and Projection Year 2008 in the form of Units. These Units are assumed to be issued at the Offering Price. (2) Based on the number of Units that are assumed to be in issue as at the Listing Date. It is assumed that the number of Units eligible for distribution is the same throughout Forecast Period 2007. (3) Based on the number of Units that are assumed to be in issue on 1 January 2008. It is assumed that the number of Units eligible for distribution is the same throughout Projection Year 2008. (4) Based on the number of Units that are assumed to be in issue on 1 January 2009. It is assumed that the number of Units eligible for distribution is the same throughout Projection Year 2009. (5) Annualised for Forecast Period 2007.

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Risk factors
Prospective investors should consider carefully, together with all other information contained in this Prospectus, the factors described below before deciding to invest in the Units. This Prospectus also contains forward-looking statements (including profit forecast and profit projection) that involve risks, uncertainties and assumptions. The actual results of LMIR Trust could differ materially from those anticipated in these forward-looking statements as a result of certain factors, including the risks faced by LMIR Trust as described below and elsewhere in this Prospectus. As an investment in a REIT is meant to produce returns over the long-term, investors should not expect to obtain short-term gains. Investors should be aware that the price of Units, and the income from them, may fall or rise. Investors should note that they may not get back their original investment. Before deciding to invest in the Units, prospective investors should seek professional advice from their relevant advisers about their particular circumstances. RISKS RELATING TO LMIR TRUSTS OPERATIONS LMIR Trusts strategy of investing primarily in retail assets may entail a higher level of risk compared to other types of unit trusts that have a more diverse range of investments. LMIR Trust is a Singapore-based REIT constituted by the Trust Deed. It is established with the principal investment objective of owning and investing on a long-term basis in a diversified portfolio of incomeproducing real estate in Indonesia that are primarily used for retail and/or retail-related purposes, and real estate related assets in connection with the foregoing. As such, LMIR Trust will be subject to risks inherent in concentrating on investments in a single real estate sector. The level of risk could be higher compared to other types of unit trusts that have a more diverse range of investments. A concentration of investments in a portfolio of specific real estate assets primarily in Indonesia exposes LMIR Trust to both downturns in the real estate market as well as the retail industry in Indonesia. In addition, the nature of the retail industry makes it particularly susceptible to a downturn in the economy. A lagging economy could lead to retrenchments and job losses, which, in turn, would lead to a reduction in consumer spending. Such downturns could also lead to a decline in occupancy for retail properties including those in LMIR Trusts portfolio thereby affecting LMIR Trusts rental income from the Master Lessee and the tenants and/or a decline in the capital value of LMIR Trusts portfolio. Any decline in the overall retail sector may cause higher levels of non-renewals of leases or vacancies as a result of failures or defaults by tenants or the market pressures exerted by an increase in available retail space. There can be no assurance that the tenants of LMIR Trusts operating retail properties will renew their leases or that the new lease terms will be as favourable as the existing leases. In the event that a tenant does not renew its lease, a replacement tenant or tenants would need to be identified, which could subject LMIR Trusts operating retail properties to periods of vacancy and/or costly refittings, during which periods LMIR Trust could experience reductions in rental income. Such downturns may have an adverse impact on distributions to the Unitholders and/or on the results of operations and the financial condition of LMIR Trust. LMIR Trust is dependent on the Master Lessee for rental payments for the Retail Spaces. LMIR Trust is dependent on rental payments from the Master Lessee for the Retail Spaces, as LMIR Trust does not directly operate the Retail Spaces. The Master Lessee is the sole tenant of each of the Retail Spaces. The Retail Spaces are expected to contribute more than 15% of LMIR Trusts rental revenue. Therefore, LMIR Trusts revenue and ability to make distributions to the Unitholders will depend largely upon the ability of the Master Lessee to make rental payments. As such, the prospects of the Master Lessees other businesses, aside from those relating to LMIR Trust, could impact on the Master Lessees ability to make rental payments to LMIR Trust.
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Risk factors Factors that affect shoppers volume at the Retail Spaces and, thereby, the ability of the Master Lessee to meet its obligations include, but are not limited to: the financial position of the Master Lessee; unemployment levels in Indonesia; the local economies; seasonal retail cycles; local retail competitors and competition in the retail industry; the Master Lessees ability to attract and retain successful tenants; unfavourable publicity; material losses in excess of insurance proceeds; a possibility of union activities disrupting the operations of the Retail Spaces, severely impacting on its reputation and ability to function normally; social unrest; and natural disasters. There can be no assurance that the Master Lessee will have sufficient assets, income and access to financing in order to enable it to satisfy its obligations under the respective Master Lease Agreement. The Master Lessee may not renew its leases of the Retail Spaces. No assurance can be given that the Master Lessee will exercise any option to renew its leases of the Retail Spaces upon the expiry of the initial 10-year term of the Master Leases. If the Master Leases are not renewed, LMIR Trust may not be able to find a suitable purchaser of the Retail Spaces or a suitable replacement master lessee, as a result of which LMIR Trust may lose a significant source of revenue. In any event, it may not be possible to replace the Master Lessee immediately upon the expiry of the Master Leases and this may lead to temporary vacancy. The failure to renew the Master Lease Agreements, or the termination of any of these Master Lease Agreements, may have a material adverse effect on LMIR Trusts Gross Revenue. The Master Lessee may terminate its leases of the Retail Spaces due to change in law. Under the Master Lease Agreements, the Master Lessee is entitled to terminate the leases if, as a result of any change in the laws or regulations, it is prohibited from carrying out its current operations at the Retail Spaces. In the event of such termination, the security deposit of the Master Lessee will be forfeited to the landlord but no compensation is payable by the Master Lessee. The termination of the leases will have a material adverse effect on LMIR Trusts Gross Revenue. The loss of key tenants of any of the Retail Malls or a downturn in the businesses of any of the Retail Malls key tenants could have an adverse effect on LMIR Trusts financial condition and results of operations. Based on Committed Leases as at 30 June 2007, the 10 largest tenants of the Retail Malls (in terms of their contributions to the total Gross Rent) accounted for approximately 37.5% of the total Gross Rent of the Retail Malls. LMIR Trusts financial condition and results of operations and ability to make distributions may be adversely affected by the bankruptcy, insolvency or downturn in the businesses of one or more of these tenants, as well as the decision by one or more of these tenants not to renew its lease or to terminate its lease before expiry. The Manager expects that LMIR Trust will continue to be dependent upon these tenants for a significant portion of its Gross Revenue. There is a risk that an anchor tenant terminates its lease or does not renew its lease at expiry. It may not be feasible to operate such large-scale retail malls in Indonesia without an anchor tenant. It may be difficult to secure replacement tenants at short notice or on
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Risk factors similar tenancy terms. In addition, the amount of rent and the terms on which lease renewals and new leases are agreed may be less favourable than those of current leases. The loss of key tenants in any one of LMIR Trusts Properties or future acquisitions could result in periods of vacancy, which could therefore adversely affect the revenue of the relevant Property, consequently impacting the Indonesian SPCs ability to make distributions to LMIR Trust. There are potential conflicts of interest amongst LMIR Trust, Mapletree Capital, the Sponsor and the Master Lessee. The Manager is 40.0% owned by Mapletree Capital and 60.0% owned by Peninsula Investment Ltd. Peninsula Investment Ltd is in turn 100.0% owned by Jesselton Investment Ltd, a wholly-owned subsidiary of the Sponsor. The Sponsor, Mapletree Capital, their respective subsidiaries and associates are, or may be, engaged in, among other things, portfolio management, investment in, and the development, management and operation of, retail properties in Indonesia and elsewhere in the region. The strategy and activities of LMIR Trust may be influenced by the overall interests of the Sponsor and/or Mapletree Capital. The Sponsor does not have any direct or indirect interest in any Units or any direct economic interest in LMIR Trust, other than through its relationship with the Manager and Lippo Strategic, which is an affiliate. Mapletree Capital is a wholly-owned subsidiary of MIPL. The Sponsor and/or Mapletree Capital may in the future sponsor, manage or invest in other REITs or other vehicles which may compete directly with LMIR Trust. There can be no assurance that conflicts of interest will not arise among LMIR Trust, the Manager, the Sponsor and/or Mapletree Capital in the future, or that LMIR Trusts interests will not be subordinated to those of the Sponsor and/or Mapletree Capital whether in relation to the future acquisition of properties or property-related investments or in relation to competition for tenants within the Indonesia market or regionally (see The Manager and Corporate GovernanceRelated Party Transactions). Mapletree Capital confirms that currently, the Mapletree Group does not own, invest or intend to develop any retail malls in Indonesia. However, there is no assurance that this may not change in the future given that this is a future commercial decision. In the event that the Mapletree Group decides to undertake any future investments and/or development of retail malls in Indonesia, any potential conflicts of interest that may arise will be addressed together with the Manager. There can be no assurance that the Sponsor and/or Mapletree Capital will not favour properties that it has retained in its own property portfolio or which it manages or operates over those owned by LMIR Trust. The Master Lessee, its subsidiaries and associates are engaged in, and/or may engage in, among other things, portfolio management, investment in, and the development, management and operation of, retail properties in Indonesia and elsewhere in the region. Any conflicts of interests could have an adverse impact on LMIR Trusts operating results, as well as distributions made to Unitholders. There are potential conflicts of interest amongst LMIR Trust and the Property Manager. The Property Manager has entered into an Existing Property Management Agreement with each of the Retail Mall Indonesian SPCs holding the relevant Retail Mall under which the Property Manager will operate, maintain, manage and market the relevant Retail Mall. (See SummaryStructure of LMIR TrustProperty Manager: PT. Consulting & Management Services Division.) The Property Manager is a full service property management company which is engaged in the business of managing properties in Indonesia. Therefore, the Property Manager may manage retail properties owned by other clients. There can be no assurance that the Property Manager will not favour other properties which it manages or operates over those owned by LMIR Trust. In addition, the Property Manager is a wholly-owned subsidiary of the Sponsor. The Sponsor, its subsidiaries and associates are engaged in, among other things, portfolio management, investment in, and the development, management and operation of, retail properties in Indonesia and elsewhere in the region. There can be no assurance that conflicts of interest will not arise among LMIR Trust, the Property Manager and the Sponsor in the future, or that LMIR Trusts interests will not be subordinated to those of
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Risk factors the Sponsor in relation to the management of other retail properties which may compete directly with those owned by LMIR Trust. (See There are potential conflicts of interest amongst LMIR Trust, Mapletree Capital, the Sponsor and the Master Lessee.) Any conflicts of interests could have an adverse impact on LMIR Trusts operating results, as well as distributions made to Unitholders. The Retail Spaces, which are located within and are part of retail malls, are subdivided developments, and there is no assurance that the other owners or tenants of strata lots in these retail malls will not vote against the interests of the Retail Spaces in matters relating to the common area, common land and common property. The Retail Spaces are part of retail malls which are subdivided developments comprising strata lots, common area, common land and common property. The common area, common land and common property are jointly owned or used by owners or tenants of the strata lots as tenants-in-common in proportion to the rights to use attributable to their respective strata lots. Under the Indonesian law on multi-storey buildings (Undang-Undang Rumah Susun), the ownership of the strata lots are evidenced by strata titles which include the right to the common area, common land and common property which constitutes an inseparable part of the ownership of the strata lots. In order to preserve the common interest among the owners and/or tenants on the use of the common area, common land and common property, the owners or tenants must establish a tenants association. Subject to the rules and regulations of the tenants association, certain matters require prior consent of the tenants association, including, for example, the use or the service charge payable in respect of the common area, common land and common property. The term common property is known in multi-storey building concepts. According to Indonesian law and regulations concerning common property, common property (such as infrastructure and area of land) is defined as properties of a multi-storey building, with such properties being used by the owners or tenants in the said multi-storey building. Therefore, each of the owners of strata lots in a multi-storey building has a proprietary interest, collectively, as the owners of such multi-storey building and as such, all rights, obligations and responsibilities arising thereof shall be borne by these owners. All of the owners or tenants must vote on certain matters as described in the rules and regulations of the tenants association in the meeting of the tenants association. As the aggregate share value of each of the Retail Spaces ranges from 35.0% to 60.0% of the total rights value of the strata lots comprised in the respective retail malls within which it is located, there is no assurance that the other owners or tenants will not vote against the interests of LMIR Trust as represented by the Retail Spaces. Further, LMIR Trust cannot freely deal with the common area, common land and common property of the retail malls within which the Retail Spaces are located, unlike in the case of a development which is wholly-owned by it. LMIR Trust will operate substantially through the Singapore SPCs and the Indonesian SPCs and its ability to make distributions to Unitholders is dependent on the financial position of the Singapore SPCs. LMIR Trust will operate substantially through the Singapore SPCs and the Indonesian SPCs and will rely on payments and other distributions from the Singapore SPCs and the Indonesian SPCs for its income and cash flows. The ability of the Singapore SPCs to make such payments may be restricted by, among other things, the Singapore SPCs and the Indonesian SPCs respective business and financial positions, the availability of distributable profits, applicable laws and regulations and the terms of agreements to which they are, or may become, a party. There can be no assurance that the Singapore SPCs will have sufficient distributable or realised profits or surplus in any future period to make dividend payments or make advances to LMIR Trust. The level of profit or surplus of each Singapore SPC available for distribution by way of dividends to LMIR Trust may be affected by a number of factors including: operating losses incurred by the Singapore SPCs in any financial year;
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Risk factors losses arising from a revaluation of any of the Properties following any diminution in value of any of the relevant Properties. Such losses would adversely affect the level of profits from which the relevant Singapore SPC may distribute dividends; accounting standards that require profits generated from investment properties to be net of depreciation charges before such profits are distributed to LMIR Trust; changes in accounting standards, taxation regulations, corporation laws and regulations relating thereto; and insufficient cash flows received by the Singapore SPCs from the Indonesian SPCs. The occurrence of these or other factors that affect the ability of the Singapore SPCs to pay dividends or other distributions to LMIR Trust may adversely affect the level of distributions paid to Unitholders. LMIR Trust may not be able to secure funding to fund future acquisitions or significant capital expenditure which the Properties or any future properties may require. The Properties and properties to be acquired by LMIR Trust may require periodic capital outlay for the purpose of refurbishments, renovation and improvements in order to remain competitive. Acquisitions or enhancement of existing properties by LMIR Trust may require significant capital expenditure. The Master Lease Agreements provide that LMIR Trust will have to bear capital expenditure relating to the Retail Spaces, subject to certain conditions, after the first 30 months of the lease terms. LMIR Trust may not be able to fund future acquisitions, capital improvements or expenditure, solely from cash derived from its operating activities and LMIR Trust may not be able to obtain additional equity or debt financing or be able to obtain such financing on favourable terms or at all. Further distributions to Unitholders may also be adversely affected as a result. LMIR Trust may face risks associated with future debt financing. As at Listing Date, LMIR Trust has not incurred any borrowings. In the event that LMIR Trust incurs any borrowings, it will be subject to risks associated with debt financing, including the risk that its cash flow will be insufficient to meet required repayments of principal and interest and to make distributions to Unitholders. LMIR Trust will distribute 100.0% of its tax-exempt income (after deduction of applicable expenses) and capital receipts for Forecast Period 2007, Projection Year 2008 and Projection Year 2009 and at least 90.0% of its tax-exempt income (after deduction of applicable expenses) and capital receipts thereafter. As a result of this distribution policy, LMIR Trust may not be able to meet all of its obligations to repay any future borrowings through its cash flow from operations. As such, LMIR Trust may be required to repay maturing debt with funds from additional debt, or equity financing, or both. There can be no assurance that such financing will be available on acceptable terms, or at all. The Manager can give no assurance regarding the amount and timing of the payment of distributions, the extent of payout ratios or the composition of distributions or the material income tax considerations of distributions, as actual events may differ from the assumptions used in assessing the ability of LMIR Trust to pay these distributions. In the event of any borrowings incurred, LMIR Trust will also be subject to the risk that the terms of any refinancing undertaken will be less favourable than the terms of any such borrowings. In addition, LMIR Trust may be subject to certain covenants in connection with any future borrowings that may limit or otherwise adversely affect its operations and its ability to make distributions to Unitholders. Such covenants may also restrict LMIR Trusts ability to acquire properties or undertake other capital expenditure or may require it to set aside funds for maintenance or repayment of security deposits. If prevailing interest rates or other factors at the time of refinancing (such as the possible reluctance of lenders to make loans in relation to retail and/or retail-related properties) result in higher interest rates upon refinancing, the interest expense relating to such refinanced indebtedness would increase, which may adversely affect LMIR Trusts cash flow and the amount of distributions it could make to Unitholders.
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Risk factors Borrowing in certain currencies, such as the Indonesian Rupiah, may incur relatively high interest rates. LMIR Trust may incur such high interest rates should it require funds in these currencies (see Strategy Acquisition Growth Strategy). The amount LMIR Trust may borrow is limited, which may affect the operations of LMIR Trust. Under the Property Funds Guidelines, LMIR Trust is generally permitted to borrow only up to 35.0% of the value of its Deposited Property at the time the borrowing is incurred. The Property Funds Guidelines also provide that the Aggregate Leverage of a REIT may exceed 35.0% of the value of its Deposited Property (up to a maximum of 60.0%) only if a credit rating of such REIT from Fitch Inc., Moodys or Standard & Poors is obtained and disclosed to the public. A REIT should maintain and disclose a credit rating so long as its Aggregate Leverage exceeds 35.0% of its Deposited Property. Upon its listing on the SGX-ST, LMIR Trust will not have incurred any indebtedness but may, from time to time, require debt financing to achieve its investment strategies as well as make distributions to Unitholders. A decline in the value of the Deposited Property may affect LMIR Trusts ability to make future borrowings as discussed above. Adverse business consequences of this limitation on borrowings may include: an inability to fund capital expenditure requirements in relation to LMIR Trusts existing portfolio or in relation to the acquisition by LMIR Trust of further properties to expand its portfolio; and cash flow shortages (including with respect to making distributions) which LMIR Trust might otherwise be able to resolve by borrowing funds. Occurrence of any acts of God, war and terrorist attacks may adversely and materially affect the business and operations of the Properties. Acts of God such as natural disasters are beyond the control of LMIR Trust or the Manager and may materially and adversely affect the economy, infrastructure and livelihood of the local population in the communities in which LMIR Trust operates. LMIR Trusts business and income available for distribution may be materially and adversely affected should such acts of God occur. There can be no assurance that any war, terrorist attack or other hostilities in any part of the world, potential, threatened or otherwise, will not, directly or indirectly, have a material and adverse effect on the operations of the Properties and hence LMIR Trusts income available for distribution. Neither LMIR Trust nor the Manager, as new entities, has an established operating history. LMIR Trust was established on 8 August 2007 and the Manager was incorporated on 3 May 2007. As such, neither LMIR Trust (as a REIT) nor the Manager (as the manager of LMIR Trust) has a relevant operating history by which their past performance may be judged. This will make it difficult for investors to assess LMIR Trusts likely future performance. There can be no assurance that LMIR Trust will be able to generate sufficient income from operations to make distributions or that such distributions will be in line with those set out in Profit Forecast and Profit Projection. The Manager may not be able to implement its investment strategy for LMIR Trust. LMIR Trusts strategy is to own and invest on a long-term basis in a diversified portfolio of incomeproducing real estate in Indonesia that are primarily used for retail and/or retail-related purposes, and real estate related assets in connection with the foregoing purposes. There can be no assurance that the Manager will be able to implement its investment strategy successfully or that it will be able to expand LMIR Trusts portfolio at all, or at any specified rate or to any specified size. The Manager may not be able to make acquisitions or investments on favourable terms or within a desired time frame. LMIR Trust faces active competition in acquiring suitable properties, especially in a low interest rate environment where other investment vehicles are highly leveraged. As such, LMIR Trusts ability to make new property acquisitions under its acquisition growth strategy may be limited. LMIR Trust will rely on external sources of funding to expand its asset portfolio, which may not be available on favourable terms, or at all. Even if LMIR Trust were able to successfully make property acquisitions or investments, there can be no assurance that LMIR Trust will achieve its intended return on such acquisitions or investments. Since the amount of borrowings that LMIR Trust can incur to finance
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Risk factors acquisitions is limited by the Property Funds Guidelines (described in more detail above), such acquisitions are likely to be largely dependent on LMIR Trusts ability to raise equity capital, which may result in a dilution of Unitholders holdings. Potential vendors may also take a negative view towards the prolonged time frame and lack of certainty generally associated with the raising of equity capital to fund any such purchase and may prefer competing purchasers. There may be significant competition for attractive investment opportunities from other property investors, including commercial property development companies and private investment funds. There can be no assurance that LMIR Trust will be able to compete effectively against such entities. Future acquisitions may not yield the returns expected, resulting in disruptions to LMIR Trusts business, a strain on management resources and dilution of holdings. LMIR Trusts external growth strategy and its market selection process may not be successful and may not provide positive returns to Unitholders. Acquisitions may cause disruptions to LMIR Trusts operations and divert managements attention away from day-to-day operations. New Units issued in connection with any new acquisition could also be substantially dilutive to Unitholders. In addition, the acquisitions themselves may not be yield accretive to Unitholders. LMIR Trust depends on certain key personnel, and the loss of any key personnel may adversely affect its operations. LMIR Trusts performance depends, in part, upon the continued service and performance of key staff members of the Manager. These key personnel may leave the Manager in the future and compete with the Manager and LMIR Trust. The loss of any of these individuals, or of one or more of the Managers other key employees, could have a material adverse effect on LMIR Trusts financial condition and results of operations. LMIR Trust may suffer material losses in excess of insurance proceeds. The Properties face the risks of suffering physical damage caused by fire or natural disaster or other causes, as well as potential public liability claims, including claims arising from the operations of the Properties, all of which may not be fully compensated by insurance proceeds. LMIR Trust will remain liable for any debt or other financial obligation related to a particular Property if there are material losses in excess of insurance proceeds. No assurance can be given that material losses in excess of insurance proceeds will not occur in the future. LMIR Trusts properties could suffer physical damage caused by tsunamis, fire or other causes, or LMIR Trust may suffer public liability claims, all of which may result in losses (including loss of rent) that may not be fully compensated by insurance proceeds. In addition, certain types of risks (such as damage caused by earthquakes, war risk and losses caused by the outbreak of contagious diseases and contamination or other environmental breaches) may be uninsurable or the cost of insurance may be prohibitive when compared to the risk. Currently, LMIR Trusts insurance policies for the Properties do not cover certain types of risks including acts of war and outbreaks of contagious diseases. Should an uninsured loss or a loss in excess of insured limits occur, LMIR Trust could be required to pay compensation and/or lose capital which it had invested in the affected Property as well as anticipated future revenue from that Property. LMIR Trust will also remain liable for any debt or other financial obligation related to that Property. No assurance can be given that material losses in excess of insurance proceeds will not occur in the future. All of the Properties are subject to various types of taxes in Indonesia. The Properties are subject to real and personal property taxes. This will change as property tax rates change and as the Properties are assessed or reassessed by the relevant tax authorities. If LMIR Trusts property tax liabilities increase, its ability to make distributions to the Unitholders could be adversely affected.
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Risk factors In addition, if LMIR Trust disposes of the Properties at the level of the Indonesian SPCs holding the Properties, the Indonesian SPCs may be subjected to Indonesian capital gains taxes. In such a situation, LMIR Trust may be indirectly liable to pay these capital gains taxes. Possible change of investment strategies, policies and capital structure, may adversely affect the Unitholders investments in LMIR Trust. The principal investment strategy of the Manager is owning and investing on a long-term basis in a diversified portfolio of income-producing real estate in Indonesia that are primarily used for retail and/or retail-related purposes, and real estate related assets in connection with the foregoing purposes. According to the Listing Manual, this investment strategy must be adhered to for at least three years following the Listing Date. However, the Trust Deed and the Property Funds Guidelines permit the Manager to alter LMIR Trusts investment strategies and policies, if it determines that such a change is in the best interests of LMIR Trust and its Unitholders. The methods of implementing LMIR Trusts investment strategies and policies may vary as new investment and financing techniques are developed or otherwise used. Any such changes may adversely affect the Unitholders investment in LMIR Trust. The appraisals of the Properties are based on various assumptions and the price at which LMIR Trust is able to sell a property may be less than the initial acquisition value of the property. LMIR Trust will use the net proceeds of the Offering to complete its acquisition of all of the ordinary shares and redeemable preference shares in the Target Singapore SPCs on the Listing Date. The consideration paid by LMIR Trust is based on the acquisition value of each of the Properties, which represent a certain level of discount to the appraised value of each of the Properties as determined by Knight Frank and Colliers (the Independent Valuers). There can be no assurance that the assumptions relied on are accurate measures of the market, and thus, the values of the Properties may have been evaluated inaccurately. In addition, the Independent Valuers may have included a subjective determination of certain factors relating to the Properties such as their relative market positions, financial and competitive strengths, and physical conditions. The appraised value of any of LMIR Trusts Properties is not an indication of, and does not guarantee, a sale price at that value at present or in the future. The price at which LMIR Trust may sell a Property may be lower than its purchase price. Epidemic diseases in Asia and elsewhere may adversely affect LMIR Trusts operations. Several countries in Asia, including Indonesia, have suffered from outbreaks of communicable diseases such as SARS and avian flu. A new and prolonged outbreak of such diseases may have a material adverse effect on LMIR Trusts business and financial condition and results of operations. Although the long-term effect of such diseases cannot be predicted, previous occurrences of SARS and avian flu had an adverse effect on the economies of those countries in which they were most prevalent. In the event a mutant strain of the avian flu virus allowing for easy human-to-human transmission is discovered, the consequence for LMIR Trusts business could be severe. An outbreak of a communicable disease, like SARS, in Indonesia may affect LMIR Trust in a number of ways, including, but not limited to, a decline in demand for consumer goods, a reduction in the number of visitors to the retail property, a decline in revenue of tenants of the retail property and increased costs of cleaning and maintaining the public facilities in the retail property. The impact of these factors on the operations of the retail property could materially and adversely affect the business, financial condition and results of operations of LMIR Trust. The Managers plan to undertake asset enhancement on some of the Properties may not materialise. The Manager intends to work with relevant Indonesian authorities to gain the necessary approvals to undertake active asset enhancement works which are currently ongoing, on some of the Properties. (See Business and PropertiesAsset Enhancement.) In the event that the necessary approvals are not obtained from the relevant Indonesian authorities, there is a risk that such proposed plans for asset enhancement will not materialise. There is also a risk that even
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Risk factors after the proposed plans for asset enhancement materialise, the proposed plans may not achieve their desired results or may incur significant costs unnecessarily. Triggering events may not occur for the ROFR. The Sponsor has granted LMIR Trust, for so long as (a) Lippo-Mapletree Indonesia Retail Trust Management Ltd. remains the manager of LMIR Trust and (b) the Sponsor and/or any of its related corporations, alone or in aggregate, remains a controlling shareholder of the Manager, a ROFR over any Relevant Asset (i) which any Sponsor Entity proposes to sell or transfer (whether such Relevant Asset is wholly-owned or partly-owned by the Sponsor Entity and excluding any sale of such Relevant Asset by a Sponsor Entity to any related corporation of such Sponsor Entity pursuant to a reconstruction, amalgamation, restructuring, merger or any analogous event) to an unrelated third party or (ii) for which a proposed offer for sale or transfer of such Relevant Asset has been made to a Sponsor Entity. This ROFR is only triggered if, among others, the foregoing events occur. There is a risk that such triggering events may not occur or that no suitable properties may be available during the validity period of the ROFR. There is also a risk that even after the ROFR is triggered, the Trustee may not enter into a binding agreement with the relevant vendor within the stipulated deadline. (See Certain Agreements Relating to LMIR Trust and the PropertiesDescription of the Right of First Refusal Agreement.) RISKS RELATING TO INVESTING IN REAL ESTATE LMIR Trust may be adversely affected by the illiquidity of real estate investments. LMIR Trust invests primarily in real estate and real estate-related assets. This involves a higher level of risk as compared to a portfolio which has a diverse range of investments. Real estate investments, particularly investments in high value properties such as those in which LMIR Trust has invested or in which it intends to invest, are relatively illiquid. Such illiquidity may affect LMIR Trusts ability to vary its investment portfolio or liquidate a portion of its assets in response to changes in economic, real estate market or other conditions. For instance, LMIR Trust may be unable to sell its assets on short notice or may be forced to give a substantial reduction in the price in order to ensure a quick sale. Moreover, LMIR Trust may face difficulties in securing timely and commercially favourable financing in asset-based lending transactions secured by real estate due to the illiquid nature of real estate assets. These factors could have an adverse effect on LMIR Trusts financial condition and results of operations, with a consequential adverse effect on LMIR Trusts ability to deliver expected distributions to Unitholders. There is no assurance that the HGB, strata titles on HGB underlying common land or HGB on top of HPL titles of the land on which the Properties are sited, can be renewed. Cibubur Junction, Mal Lippo Cikarang, Istana Plaza and Plaza Madiun are sited on land with HGB titles, while Gajah Mada Plaza is held via strata titles on HGB underlying common land. Bandung Indah Plaza is sited on land with HGB titles on top of HPL titles. (See Business and Properties Information Regarding the Title of the PropertiesHak Pengelolaan (HPL) titles.) A HGB title is granted for a maximum initial term of 30 years. By application to the relevant local land office upon the expiration of this initial term, a HGB title may be extended for an additional term not exceeding 20 years. Following expiration of this additional term, a renewal application may be made. (See Overview of Relevant Laws and Regulations in IndonesiaRights to Own and/or to Use.) Under Indonesian land law, there is no limitation on the number of extensions and renewal cycles for HGB titles. However, there is no assurance that there will be approval for such renewal or extension in the future. The non-renewal of these HGB titles, for any reason, could either adversely affect the operations of the Properties or result in LMIR Trust losing its ownership of the Properties. There is no assurance that the BOT Agreements can be extended. Cibubur Junction, The Plaza Semanggi, Ekalokasari Plaza, Bandung Indah Plaza and Istana Plaza will be indirectly held by LMIR Trust pursuant to the respective BOT Agreement or the Cooperation Agreement. The BOT Agreement does not amount to a legal title and is essentially a contractual arrangement and governed by Indonesian Civil Code. Pursuant to Article 1338 of the Indonesian Civil Code the contracting
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Risk factors parties are free to arrange their relationship in the BOT Agreement or Cooperation Agreement (freedom of contract) subject to, among others, the prevailing laws and regulations, the good faith of the contracting parties and public policy principles. The terms of the BOT Agreements range from 20 years to 30 years. Since the BOT Agreement is a contractual arrangement, the term of the respective BOT Agreement may be extended based on agreement between the BOT Grantor and the BOT Grantee. Except for the BOT Agreement relating to The Plaza Semanggi, which provides for automatic extension for an additional term of 20 years, upon six months prior written notification, there is no assurance that the respective BOT Grantor will agree to extend the term of the BOT Agreements. If there is no agreement to extend the BOT Agreement(s), the operations of the Properties could be adversely affected or LMIR Trust could lose its indirect ownership of the Properties. If the ownership of the BOT land is transferred, there is no assurance that the transferee of the land will recognise the right of the BOT Grantee. Five of the seven Retail Malls, namely, Cibubur Junction, The Plaza Semanggi, Ekalokasari Plaza, Bandung Indah Plaza and Istana Plaza, are held via BOT Schemes. Pursuant to BOT Schemes, the BOT Grantor has granted the relevant Retail Mall Indonesian SPC (as the BOT Grantee), a right to build and operate the Retail Mall for a particular period of time as stipulated in the BOT Agreement. Based on the BOT Agreement, the BOT Grantor is obliged to provide the BOT Land and the BOT Grantee is obliged to build and operate the building over the BOT Land and to pay a certain amount as compensation to the BOT Grantor. Therefore, if the BOT Grantor transfers the BOT Land to another party (the Transferee) during the term of the BOT Agreement, the BOT Grantee can make a claim against the BOT Grantor based on a breach of contract. Under the Indonesian Civil Code, there are four principal sanctions to a breach of contract: (i) compensation of costs, damages and lost profits; (ii) cancellation of the contract; (iii) transfer of risk or responsibility for the object of the contract; and (iv) payment of court costs (which would usually exclude legal expenses) in the event of a court claim. Damages may include consequential damages unless expressly excluded by agreement. The parties may, by specific contractual provision, limit damages to a certain amount, or they may agree on a particular method of calculating damages. In all cases, the existence of monetary damages suffered and the amount of such must be proven. Under Articles 1247, 1248 and 1250 of the Indonesian Civil Code, the following limitations apply to the types of costs, damages and interest recoverable: (a) damages which could have been foreseen or anticipated at the time the contract was formed. According to case law, the scope of the loss as well as the possibility of injury must have been foreseeable; (b) damages directly and immediately flowing or resulting from the breach of contract; and (c) in a case where performance involves the payment of money, damages may include interest. According to generally accepted rules of jurisprudence in Indonesia, a creditor is required to do what can reasonably be done to prevent or to reduce the damages (i.e. mitigate damages). Should the BOT Grantor be wound up, any claims by the BOT Grantee may not be satisfied in part or at all by the BOT Grantor. In addition, there is no assurance that the Transferee of the BOT Land will recognise the right of the BOT Grantee to build and operate a Retail Mall on the BOT Land. Under such circumstances, the BOT Grantee may be required to surrender the ownership of the Retail Mall to the Transferee of the BOT land and this could have a material adverse effect on LMIR Trusts financial condition and results of operations. (See Profit Forecast and Profit ProjectionSensitivity Analysis Retail Malls held via BOT Schemes.)
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Risk factors If the tenure of the underlying BOT land is less than the term of the BOT Agreement, there is no assurance that the BOT Grantor will be able to renew the title of the BOT land. The term of BOT Agreements ranges from 20 years to 30 years. In respect of the BOT Agreement relating to Cibubur Junction, the title of the underlying BOT Land will expire on 23 December 2021 and can be extended in accordance with the prevailing laws and regulations, while the BOT Agreement will expire on 28 July 2025 and may be extended. Based on the BOT Agreement, the BOT Grantor undertakes that it will extend the term of the title of the BOT Land and the cost incurred for such extension will be borne by the BOT Grantor. There is no assurance that the BOT Grantor will be able to renew the title of the BOT Land. If the BOT Grantor for whatever reason is not able to extend the term of the BOT Land, the relevant Retail Mall Indonesian SPC as BOT Grantee will have to deliver the Retail Mall situated on the BOT Land without any compensation from the BOT Grantor. This can result in a material adverse effect on LMIR Trusts Gross Revenue. If the BOT Grantor cannot renew the term of the BOT land, the BOT Grantee would have the right to make a claim against the BOT Grantor for a breach of contract.

LMIR Trust is dependent on the underlying titles to the Properties. Due to the nature of Indonesian property law and the variety of land titles in Indonesia, there is potential for disputes over the quality of title purchased from previous land owners. In addition, there is a need to negotiate with the actual owner of the land each time land is acquired under a licence, which may result in purchases of property (and thereby the obtaining of title to the relevant land) being delayed or obstructed in the event that negotiations are unsuccessful. Such delays in acquiring properties required for development activities could have an adverse effect on LMIR Trusts business, financial condition and results of operations. Each of the strata units comprising the relevant Retail Space at the Metropolis Town Square Units, the Depok Town Square Units, the Malang Town Square Units and the Grand Palladium Medan Units, are owned pursuant to a Kiosks Sale and Purchase Binding Agreement, which is evidence of the parties intention to effect the sale and purchase of the relevant strata units, but do not have the effect of transferring ownership. Any dispute over the enforceability of these agreements or the transferability of the benefit thereunder could have an adverse effect on LMIR Trusts business, financial condition and results of operation.

LMIR Trusts acquisition of all of the ordinary shares and redeemable preference shares in the Target Singapore SPCs may be subject to risks associated with the acquisition of new properties and shares in property holding companies. While the Manager believes that reasonable due diligence investigations have been conducted with respect to the ordinary shares and redeemable preference shares in the Target Singapore SPCs and the Properties prior to acquisition of the ordinary shares and redeemable preference shares in the Target Singapore SPCs, there can be no assurance that such shares in the Target Singapore SPCs or the Properties will not have certain defects or deficiencies. The management or condition of some of the Properties may be in breach of laws and administrative regulations including those in relation to real estate or be subject to building defects and deficiencies which the Managers due diligence investigations did not uncover or may not comply with certain regulatory requirements. As a result, LMIR Trust may incur additional financial or other obligations in relation to such defects or deficiencies. In particular, the representations, warranties and indemnities granted in favour of LMIR Trust by the Vendors are subject to limitations as to their scope and as to the amount and timing of claims which can be made thereunder. There can be no assurance that LMIR Trust will be entitled to be reimbursed under such representations, warranties and indemnities for any and all losses or liabilities suffered or incurred by it as a result of its acquisition, via the Singapore SPCs and Indonesian SPCs, of the Properties.
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Risk factors LMIR Trust will be subject to the operating risks inherent in the retail property industry. The Properties will all be indirectly owned by LMIR Trust as at Listing Date. As such, LMIR Trust will be subject to the operating risks inherent in the retail property industry. The risks that LMIR Trust faces include: cyclical downturns arising from changes in general and local economic conditions; periodic local oversupply of retail malls, which may adversely affect the results of operations of LMIR Trust; the recurring need for renovation, refurbishment and improvement of the retail malls; changes in wages, prices, energy costs and construction and maintenance costs that may result from inflation, governmental regulations, changes in interest rates or currency fluctuations; availability of financing for operating or capital requirements; increases in operating costs due to inflation which may not necessarily be offset by corresponding increases in rental payments from the Properties; and other factors, including outbreak of communicable diseases, acts of terrorism, natural disasters, extreme weather conditions, labour shortages and work stoppages or disputes. The Gross Revenue earned from, and the value of, the Properties may be adversely affected by a number of factors. The Gross Revenue earned from, and the value of the Properties may be adversely affected by a number of factors, including: vacancies following expiry or termination of leases leading to reduced occupancy rates which, in turn, reduce revenue; the Managers ability to collect rent from tenants on a timely basis or at all; the amount and extent to which the Manager is required to grant rebates on rental rates to tenants due to market pressure; tenants seeking the protection of bankruptcy laws which could result in delays in receipt of rent payments, inability to collect rentals at all or delays in the termination of the tenants lease, or which could hinder or delay the sale of a Property or the re-letting of the space in question; the amount of rent payable by tenants and the terms on which lease renewals and new leases are agreed being less favourable than current leases; the national and international economic climate and property market conditions (such as oversupply of, or reduced demand for, retail space, the release of land for retail development, changes in market rental rates and changes in operating expenses for the Properties; the Managers ability to procure adequate management and maintenance or to purchase adequate insurance; competition for tenants from other similar properties which may affect rental levels or occupancy levels at the Properties; and changes in laws and governmental regulations in relation to property, including those governing usage, zoning, taxes and government charges. Such revisions may lead to an increase in management expenses or unforeseen capital expenditure to ensure compliance. Rights related to the relevant Properties may also be restricted by legislative actions, such as revisions to the building standards laws or the town planning laws, or the enactment of new laws related to condemnation and redevelopment.
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Risk factors The Properties may be subject to increases in operating and other expenses. LMIR Trusts ability to make distributions to the Unitholders could be adversely affected if operating and other expenses increase without a corresponding increase in revenues. Factors which could increase operating and other costs include: increase in property tax assessments and other statutory charges; change in statutory laws, regulations or government policies which increase the cost of compliance with such laws, regulations or policies; increase in sub-contracted service costs; increase in labour costs; increase in repair and maintenance costs; increase in the rate of inflation; increase in insurance premiums; and increase in cost of utilities. LMIR Trust will not have a right of first refusal to purchase the ROFR Properties if the Sponsor and/or any of its related corporations cease to be a controlling shareholder of the Manager. The Sponsor has granted LMIR Trust, for so long as (a) Lippo-Mapletree Indonesia Retail Trust Management Ltd. remains the manager of LMIR Trust and (b) the Sponsor and/or any of its related corporations, alone or in aggregate, remains a controlling shareholder of the Manager, a ROFR over any Relevant Asset (i) which any Sponsor Entity proposes to sell or transfer (whether such Relevant Asset is wholly-owned or partly-owned by the Sponsor Entity and excluding any sale of such Relevant Asset by a Sponsor Entity to any related corporation of such Sponsor Entity pursuant to a reconstruction, amalgamation, restructuring, merger or any analogous event) to an unrelated third party or (ii) for which a proposed offer for sale or transfer of such Relevant Asset has been made to a Sponsor Entity (see Certain Agreements Relating to LMIR Trust and the PropertiesDescription of the Right of First Refusal Agreement). The Sponsor and/or its related corporations have not given any undertaking to refrain from disposing any of its shareholding interest in the Manager. In the event that the Sponsor and/or its related corporations cease to be the controlling shareholder of the Manager, LMIR Trust will no longer have the ROFR to purchase such properties, including the ROFR Properties. This may adversely affect LMIR Trusts pipeline of future acquisitions. RISKS RELATING TO THE PROPERTIES LMIR Trust may exercise its rights under the Put Option Agreement and sell four of the Retail Spaces to the Master Lessee. As at the Latest Practicable Date, four of the seven Retail Spaces, namely Metropolis Town Square Units, Depok Town Square Units, Malang Town Square Units and Grand Palladium Medan Units, are each bound by Kiosks Sale and Purchase Binding Agreements because their strata titles are in the process of being issued by the Indonesian government. Accordingly, LMIR Trust does not currently have proper legal and good marketable titles of these four Retail Spaces. The legal process to obtain these strata titles may be lengthy and may only be issued post listing. The Trustee and the Master Lessee have entered into a put option agreement pursuant to which, in the event that the strata titles to these four Retail Spaces are not issued within 24 months from the Listing Date, a meeting of all the Unitholders will be convened by the Trustee pursuant to which the Unitholders will vote, by way of an ordinary resolution, on whether to retain these four Retail Spaces in the portfolio of LMIR Trust for a further six months from the date of the ordinary resolution. In the event that an ordinary resolution is passed in favour of retaining these four Retail Spaces in the portfolio of LMIR Trust and the strata titles are still not issued upon expiry of six months from the date of the ordinary resolution, the Trustee shall be entitled to exercise the put option. In the event that an ordinary resolution is not passed in
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Risk factors favour of retaining these four Retail Spaces, the Trustee shall be entitled to exercise the put option within three months of the date of the meeting of the Unitholders. Upon exercising the put option, the Master Lessee will be required to purchase the entire issued and paid-up capital of the relevant Singapore SPCs, which through the Indonesian SPCs, own these four Retail Spaces at the consideration of the higher of (i) the net asset value of the relevant Indonesia SPCs as at the date of service of the put option notice as determined from the audited consolidated accounts of the SPCs and (ii) the net asset value based on the value attributed to these four Retail Spaces for the purpose of the Listing, in each case, also taking into account all transaction costs incurred directly and indirectly by LMIR Trust for the acquisition of these four Retail Spaces. (See Certain Agreements relating to LMIR Trust and the PropertiesDescription of the Put Option Agreements.) The Trustee (acting on the advice and recommendation of, and after discussions with, the Manager) is satisfied with the computation of the said transaction costs as set out in the put option agreement. Although the Manager will endeavour to acquire comparable retail spaces in order to maintain or enhance LMIRs distribution per Unit, there is no assurance that this can be achieved. In the event that comparable retail spaces cannot be acquired, the Gross Revenue, the income available for distribution by LMIR Trust to Unitholders, the distribution per Unit and the distribution yield for the Projection Year 2009 may be adversely affected. The market values of the Properties may differ from their values as determined by the Independent Valuers. The valuations were generally conducted using a combination of valuation methods such as the discounted cash flow method and the investment income capitalisation method. Property valuations generally include a subjective determination of certain factors relating to the relevant properties, such as their relative market positions, their financial and competitive strengths and their physical conditions. The market values of the Properties may therefore differ from the values of the Properties as determined by the Independent Valuers. The values of the Properties (as determined by the Independent Valuers) are not an indication of, and do not guarantee, a sale price at that value at present or in the future. The price at which LMIR Trust sells a property may be lower than its value as determined by the Independent Valuers. The Properties may face increased competition from future retail developments in Indonesia. The retail property industry is competitive and may become increasingly so. Each of the Properties is located in an area that has competing retail malls. They may also compete with retail malls in Indonesia developed in the future. The income from, and market value of, the Properties will be largely dependent on the ability of the Properties to compete against other retail properties in Indonesia in attracting and retaining tenants. An increase in the number of competitive retail malls in Indonesia, particularly in the areas where the Properties are located, could have a material adverse effect on the revenue of the Properties, as such increased competition may have an adverse impact on the ability of the lessees of the Retail Malls or the Master Lessee of the Retail Spaces to make rental payments. Amenities and transportation infrastructure near the Properties may be closed, relocated or terminated. The proximity of amenities and transportation infrastructures, such as train stations and bus interchanges, to the Properties provides convenient access to the Properties and a constant flow of shopper traffic. There is no assurance that the amenities and transportation infrastructure and shuttle services will not be closed, relocated or terminated in the future. Such closure, relocation or termination may adversely affect the accessibility of the Properties which will reduce the flow of shopper traffic to the Properties. This may then have an adverse effect on the demand for and the rental rates of the Properties and adversely affect the financial position of LMIR Trust.
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Risk factors Renovation work or physical damage to the Properties may disrupt the operations of LMIR Trust and collection of rental income or otherwise result in adverse impact on the financial condition of LMIR Trust. The quality and design of the Properties directly influence the rental rates of and the demand for space in the Properties, as well as the ability to attract heavy shopper traffic. The Properties may need to undergo renovation work from time to time to retain their attractiveness to tenants and may also require ad hoc maintenance or repairs caused by structural defects or because of new planning laws or regulations. The costs of maintaining a retail property and the risk of unforeseen maintenance or repair requirements tend to increase over time as the Properties age. While the Manager and the Property Manager will endeavour to keep any disruptions caused by such renovation work to a minimum, the business and operations of the Properties may still suffer some disruption and it may not be possible to collect the full rate of, or, as the case may be, any rental income on space affected by such renovation work. Shopper traffic may also be adversely affected by potential inconveniences resulting from such renovation work. Physical damage to the Properties resulting from fire or other causes may lead to a significant disruption to the business and operation of the Properties and together with the foregoing may result in an adverse impact on the financial condition and results of operations of LMIR Trust and its ability to make distributions. Some of the anchor tenants of the Retail Malls may terminate their leases pursuant to a sixmonth termination clause Under the respective lease agreements, some of the anchor tenants of the Retail Malls may terminate their leases with a six-month notice period. The loss of these anchor tenants in the Retail Malls could result in periods of vacancy, which could therefore adversely affect the revenue of the relevant Retail Mall, consequently impacting the Indonesian SPCs ability to make distributions to LMIR Trust. A substantial number of the leases of the Retail Malls are for terms of three to five years, which exposes the Retail Malls to significant rates of lease expiries each year. A substantial number of the leases for the Retail Malls are for terms of three to five years. As a result, the Properties experience lease cycles in which a substantial number of such leases expire each year. This exposes LMIR Trust to certain risks, including the risk that vacancies following the non-renewal of leases may lead to reduced occupancy rates, which will in turn reduce LMIR Trusts Gross Revenue. The inspections carried out during the valuation exercise on buildings and equipment may not have identified all material defects, breaches of laws and regulations and other deficiencies. The Independent Valuers conducted inspections on the physical condition of the Properties as part of the valuation exercise. There can be no assurance that such reviews, surveys or inspections have revealed all defects or deficiencies affecting the Properties. In particular, there can be no assurance as to the absence of: (i) latent or undiscovered defects or deficiencies; or (ii) inaccuracies or deficiencies in such review, survey or inspection reports, any of which could have a material adverse effect on the operations of the Properties and, consequently, LMIR Trusts financial condition and results of operations. The risk of undisclosed defects, breaches and deficiencies is necessarily increased as a result of the time interval between completion of the review, survey and inspection process and the date of this Prospectus. The Master Lessee may not be liable to pay rent if any of the Retail Spaces is damaged or destroyed. Under the Master Lease Agreements, if any of the Retail Spaces is damaged or destroyed such that the Retail Space cannot be used or becomes inaccessible, the relevant landlord has the option to reinstate or replace such Retail Space (or the affected part, as the case may be) using insurance proceeds received under the insurance policies. If the relevant landlord opts to reinstate or replace the Retail Space, the Master Lessee will not be liable to pay rent in respect of the period when the Retail Space cannot be used
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Risk factors or is inaccessible. The non-payment of rent by the Master Lessee will have a material adverse effect on LMIR Trusts Gross Revenue. RISKS RELATING TO INDONESIA LMIR Trust is exposed to economic and real estate market conditions and changes in fiscal policies in Indonesia. LMIR Trust is a Singapore-based REIT constituted by the Trust Deed. It is established with the principal investment objective of owning and investing on a long-term basis in a diversified portfolio of incomeproducing real estate in Indonesia that are primarily used for retail and/or retail-related purposes, and real estate related assets in connection with the foregoing. All of the Properties are situated in Indonesia. As a result, LMIR Trusts revenue and results of operations depend to a large extent on the performance of the Indonesian economy. An economic decline in Indonesia could adversely affect LMIR Trusts results of operations and financial growth. Political upheavals, natural disasters, insurgency movements, riots and governmental policies all play a pivotal role in the performance of the Properties. Other local real estate market conditions which may adversely affect the performance of LMIR Trust include the attractiveness of competing retail properties, an oversupply of or a reduced demand for retail properties. LMIR Trust may also be exposed to risks associated with exchange rate fluctuations between the Indonesian Rupiah or the local currency of foreign countries in which LMIR Trust invests in and the Singapore dollar. LMIR Trust will be subject to Indonesian real estate laws, regulations and policies as a result of its property investments in Indonesia. There may be a negative impact on a property owned by LMIR Trust in Indonesia as a result of measures and policies adopted by the Indonesian government and regulatory authorities at national, provincial or local levels, such as governmental control over property investments or regulations in relation to foreign exchange. Legal protection and recourse available to LMIR Trust in Indonesia may be limited. In addition, the income and gains derived from investment in properties in Indonesia will be subject to various types of taxes in Indonesia, including income tax, withholding tax, capital gains tax and any other taxes that may be imposed specifically for ownership of real estate. All of these taxes, which are subject to changes in laws and regulations that may lead to an increase in tax rates or the introduction of new taxes, could adversely affect and erode the returns from these properties and hence the distribution to Unitholders. There is also no assurance that LMIR Trust will be able to repatriate to Singapore the income and gains derived from investment in properties outside Singapore on a timely and regular basis. Any inability to repatriate the income and gains to Singapore will affect LMIR Trusts ability to make distributions to Unitholders out of such income and gains. The Properties and/or future acquisitions, or a part of them, may be acquired compulsorily by the Indonesian government. In Indonesia, pursuant to Law No. 20 of 1961 concerning Revocation of Rights of Land and the Properties Thereon and Law No. 28 of 2002 concerning Building Construction in conjunction with Presidential Regulation No. 36 of 2005 (as amended by the Presidential Regulation No. 65 of 2006) concerning Land Procurement for the Development of Public Interest, after fulfilling certain procedures and compensating the land owners based on reasonable price and prevailing laws and regulations, the Indonesian government has the right to revoke any right over the land and any property thereon owned by any party, in order for the Indonesian government (including local governments) to fulfil public needs, including public roads, airports, train stations, water embankments or natural reservations. Therefore, there is no assurance that the Indonesian government will not compulsorily acquire the lands on which the Properties are situated.
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Risk factors Such compulsory acquisitions would have an adverse effect on the financial condition, operating results and the value of LMIR Trusts asset portfolio. Terrorist attacks in Indonesia could destabilise the country. Terrorist acts in Indonesia could destabilise Indonesia and increase internal divisions within the Indonesian government as it evaluates responses to that instability and unrest. Violent acts arising from, and leading to, instability and unrest have in the past had, and may continue to have, a material adverse effect on investment and confidence in, and the performance of, the Indonesian economy, and may have a material adverse effect on the Master Lessees business, financial condition, results of operations and future prospects. This could adversely impact the ability of the tenants of the Retail Malls and the Master Lessee to make rental payments to the Indonesian SPCs. Economic changes in Indonesia may adversely affect the Master Lessees business. The economic crisis which affected Southeast Asia, including Indonesia, around mid-1997 was characterised in Indonesia by, among other effects, currency depreciation, negative economic growth, high interest rates, social unrest and extraordinary political developments. These conditions had material adverse effects on Indonesian businesses. The economic difficulties faced by Indonesia during the Asian economic crisis in 1997 resulted in, among other things, significant volatility in interest rates, which had a material adverse impact on the ability of many Indonesian companies to service their existing indebtedness. In addition, Indonesia relies heavily on aid from the International Monetary Fund (IMF), loans from the World Bank and the members of the Paris Club, as well as from the Consultative Group on Indonesia (CGI). The inability of the Indonesian government to obtain adequate funding, in the event of a termination of the IMF program, or a reduction or elimination of funding from the World Bank and the members of the Paris Club or the CGI, could have adverse economic, political and social consequences in Indonesia, which in turn, could have a material adverse effect on the Master Lessees business, financial condition, results of operations and future prospects. A loss of investor confidence in the financial system of emerging and other markets may cause increased volatility in the Indonesian financial markets, and a slowdown or negative growth could have material adverse effects on the Master Lessees business, financial condition, results of operations and prospects. Demand for retail services are largely dependent on the purchasing power of shoppers and their willingness to pay for retail services. A slowdown in the Indonesian economy or a high unemployment rate may require more people to adopt a prudent approach towards spending, resulting in a lower demand for retail services. The Singapore-Indonesia tax treaty may be applied in a manner adverse to the interests of the Unitholders. The Indonesian tax rules generally require a 20.0% tax to be withheld on the payment of a dividend or interest from an Indonesian taxpayer to an offshore tax resident. Under the double tax treaty between Singapore and Indonesia, the rate of withholding tax is reduced to 10.0% on the payment of a dividend or interest to a Singapore tax resident which is the beneficial owner of this payment. The reduced rate is available to a Singapore company only if the company submits an original copy of the certificate of domicile to the Indonesian payor prior to the payment of the income. On 7 July 2005, the Directorate General of Taxation in Indonesia issued a circular letter indicating that the benefits of Indonesias double tax treaties would not be available to a recipient of Indonesian-sourced income that was not the beneficial owner of such income. The circular letter further elaborated that a SPV which is a conduit company, paper box company, pass through company, or any similar form of entity would not qualify as the beneficial owner of payments received by it. The independent tax advice from PB&Co, the Independent Indonesian Tax Adviser, sets out that the reduced withholding tax rate of 10.0% should apply to the payment of interest and dividends to a Singapore tax-resident beneficial owner. Under Singapore income tax law, the Singapore SPCs would be considered tax resident in Singapore if the control and management of their business is exercised in
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Risk factors Singapore. As a general rule, the place where a companys control and management is exercised and hence the tax residence of the company is the place where the directors of the company hold their meetings. The board of directors of the Singapore SPCs will endeavour to ensure that the control and management of each of the Singapore SPCs is exercised in Singapore so that each would be considered a tax resident of Singapore. The Singapore SPCs are the beneficial owner of the shares in the Indonesian SPCs and of the loans to the Indonesian SPCs. Therefore, they should be considered as the beneficial owner of the interest and dividend income received from the Indonesian SPCs. Nevertheless, it remains uncertain as to whether the Indonesian tax authorities will view the Singapore SPCs as the beneficial owners of the interest and dividends. If the Singapore SPCs are not viewed as the beneficial owners, it should still be possible to obtain the reduced withholding tax rate to the extent that Singapore tax residents (or any other jurisdiction with the same tax rate under their respective double tax treaty) are the Unitholders of LMIR Trust. If the higher withholding tax rate of 20.0% would apply to the dividend and interest payments from the Indonesian SPCs, this will accordingly lower the income paid to the Singapore SPCs and in turn may adversely affect the financial results of LMIR Trust and its distributions to Unitholders. The Indonesian legal system is subject to considerable discretion and uncertainty. Indonesias legal system is a civil law system based on written statutes in which judicial and administrative decisions do not constitute binding precedents and are not systematically published. Indonesias commercial and civil laws are historically based on Dutch law as in effect prior to Indonesias independence in 1945. Some of these laws have not been revised to reflect the complexities of modern financial transactions and instruments. There may be uncertainty in the interpretation and application of legal principles in Indonesia. The application of legal principles in Indonesia depends upon subjective criteria such as the good faith of the parties to the transaction and principles of public policy, the practical effect of which is difficult or impossible to predict. Indonesian judges have very broad fact-finding powers and a high level of discretion in relation to the manner in which those powers are exercised. As a result, the administration and enforcement of laws and regulations by Indonesian courts and Indonesian governmental agencies may be subject to considerable discretion and uncertainty. Indonesian legal principles relating to the rights of debtors and creditors, or their practical implementation by Indonesian courts, differ materially from those that would apply in, for example, Singapore, the United States or the European Union. As a result, it may be more difficult for the Trustee, on behalf of LMIR Trust, to pursue a claim against the tenants of the Retail Malls or the Master Lessee in Indonesia than it would be in other jurisdictions, such as in Singapore. This may adversely affect or eliminate entirely LMIR Trusts ability (and indirectly, the ability of its Unitholders) to obtain and/or enforce a judgment against the Master Lessee in Indonesia. The operations of the Properties may be adversely affected by earthquakes, tsunamis, floods or other natural disasters. The Indonesian archipelago is one of the most active volcanic regions in the world. As it is located in the convergence zone of three major lithospheric plates, it is subject to significant seismic activity that can lead to destructive earthquakes and tidal waves. On 26 December 2004, an underwater earthquake off the coast of Sumatra resulted in a tsunami that devastated coastal communities in Indonesia, Thailand and Sri Lanka. In Indonesia, more than 220,000 people died or were recorded as missing in the disaster. Aftershocks from the December 2004 tsunami have also claimed casualties. In March 2007, a powerful earthquake hit the Indonesian island of Sumatra, flattening hundreds of buildings and killing at least 70 people. On 12 September 2007, a strong earthquake occurred in Sumatra which caused significant aftershocks in the surrounding regions. The operations of the Properties may be affected by floods. In February 2007, incessant rain caused rivers to overflow across Jakarta. As a result, homes, government buildings, retail malls and businesses were flooded. The authorities were forced to cut off electricity and water supplies in certain areas. There can be no assurance that future geological occurrences will not significantly impact the operations of the Properties. An earthquake or other geological disturbance in any of Indonesias more populated cities and financial centres could disrupt the Indonesian economy and the operations of the Properties,
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Risk factors thereby materially and adversely affecting the ability of the tenants of the Retail Malls and the Master Lessee to make rental payments to the Indonesian SPCs. Labour activism and unrest may materially and adversely affect the Properties. Laws permitting the formation of labour unions, combined with weak economic conditions, have resulted, and may continue to result, in labour unrest and activism in Indonesia. In March 2003, the Indonesian government enacted Law No. 13/2003 (the Labour Law) that requires further implementation of regulations that may substantively affect labour relations in Indonesia. The Labour Law requires bipartite forums with participation from employers and employees, and the participation of more than 50.0% of the employees of a company, in order for a collective labour agreement to be negotiated and, in addition, the Labour Law creates procedures that are more permissive to the staging of strikes. Labour unrest and activism in Indonesia could disrupt operations of the Properties, and thus could materially and adversely affect the ability of the tenants of the Retail Malls and the Master Lessee to make rental payments to the Indonesian SPCs. RISKS RELATING TO AN INVESTMENT IN THE UNITS The sale or possible sale of a substantial number of Units by the Cornerstone Investors in the public market following the lapse of any applicable lock-up arrangements could have adverse effects on LMIR Trust. The Cornerstone Investors, being Lippo Strategic and Mapletree LM, will receive Cornerstone Units, amounting to an aggregate of approximately 39.1% of the total issued Units as at the Listing Date, (assuming no exercise of the Over-allotment Option). Lippo Holdings Inc, Lippo Capital Limited, Lippo Cayman Limited and Lanius Ltd are deemed to have interests in the Cornerstone Units due to their direct or indirect (as the case may be) interests in Lippo Strategic. Lippo Strategic (also the Unit Lender), Lippo Holdings Inc, Lippo Capital Limited, Lippo Cayman Limited, Lanius Ltd, MIPL, Mapletree Dextra Pte Ltd and Mapletree LM have on 9 November 2007 each agreed to (a) a lock-up arrangement in respect of their direct or indirect interests (as the case may be) in the Cornerstone Units (or any securities convertible or exchangeable for units or which carry any rights to subscribe for or purchase units) (adjusted for any bonus issue, consolidation or subdivision), as at the Listing Date during the First Lock-Up Period; and (b) a lock-up arrangement in respect of their direct or indirect interests (as the case may be) in 50.0% of the Cornerstone Units (or any securities convertible or exchangeable for units or which carry any rights to subscribe for or purchase units) (adjusted for any bonus issue, consolidation or subdivision)as at the Listing Date during the Second Lock-Up Period, subject to certain exceptions. (See Plan of DistributionLock-Up Arrangements). However, there is no assurance that any of Lippo Strategic (also the Unit Lender), Lippo Holdings Inc, Lippo Capital Limited, Lippo Cayman Limited, Lanius Ltd, MIPL, Mapletree Dextra Pte Ltd and Mapletree LM will not dispose of its direct or indirect interest in the Cornerstone Units following the expiry of the First Lock-Up Period and the Second Lock-Up Period. There is also no assurance that the Cornerstone Investors will not dispose of their direct or indirect interests in the Cornerstone Units. In the event that any of the Cornerstone Investors decides to transfer or dispose of its direct or indirect interest in the Cornerstone Units, there may be a material and adverse impact on the market price of the Units. LMIR Trust may not be able to make distributions to Unitholders or the level of distributions may fall. The net operating profit earned from real estate investments depends on, among other factors, the amount of rental income received, and the level of property, operating and other expenses incurred. If the properties which are directly or indirectly held by LMIR Trust do not generate sufficient net operating
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Risk factors profit, LMIR Trusts income, cash flow and ability to make distributions will be adversely affected. In addition, if the Singapore SPCs have insufficient cash flows or distributable profits or surplus, or the Singapore SPCs do not make the expected level of distributions in any financial year, LMIR Trusts income, cash flow and ability to pay or maintain distributions to Unitholders, may be adversely affected. No assurance can be given as to LMIR Trusts ability to pay or maintain distributions. Nor is there any assurance that the level of distributions will increase over time, that there will be contractual increases in rent under the leases of the Properties or that the receipt of rental income in connection with expansion of the properties or future acquisitions of properties will increase LMIR Trusts cash flow available for distribution to Unitholders. Market and economic conditions may affect the market price and demand for the Units. Movements in domestic and international securities markets, economic conditions, foreign exchange rates and interest rates may affect the market price of, and demand for, the Units. In particular, an increase in market interest rates may have an adverse impact on the market price of the Units if the annual yield on the price paid for the Units gives investors a lower return compared to other investments. The NAV per Unit may be diluted if further issues are priced below the then NAV per Unit. The Trust Deed contemplates issues of new units, the Offering Price for which may be above, at or below the then NAV per Unit. Where new units, including units which may be issued to the Manager in payment of the Managers management fees, are issued at less than the current NAV per Unit, the NAV of each existing Unit may be diluted. The laws, regulations and accounting standards in Indonesia, Singapore or countries in which future acquisitions may be situated, may change. LMIR Trust may be affected by the introduction of new or revised legislation, regulations or accounting standards. Accounting standards in Indonesia and Singapore are subject to changes as accounting standards in both countries become more aligned with international accounting standards. The financial statements of LMIR Trust and the Singapore SPCs may be affected by the introduction of such revised accounting standards. The extent and timing of these changes in accounting standards are unknown and are subject to confirmation by the relevant authorities. The Manager has not quantified the effects of these proposed changes and there can be no assurance that these changes will not have a significant impact on the presentation of LMIR Trusts financial statements or on LMIR Trusts results of operations. Such changes may adversely affect the ability of LMIR Trust to make distributions to Unitholders. There can be no assurance that any such changes in laws, regulations and accounting standards will not have an adverse effect on the ability of the Manager to carry out LMIR Trusts investment strategy or on the operations and financial condition of LMIR Trust. LMIR Trust may be unable to comply with the conditions for the tax exemption and tax ruling, or the tax exemption or tax ruling may no longer apply. LMIR Trust has obtained an approval from the Inland Revenue Authority of Singapore (IRAS) to exempt from Singapore income tax any interest received by the Singapore SPCs from the Indonesian SPCs that is paid out of the underlying rental income derived from the Properties. This tax exemption is given under Section 13(12) of the Income Tax Act. LMIR Trust has also received an advance ruling from IRAS issued under Section 108 of the Income Tax Act which confirms that a return of capital by LMIR Trust is not a taxable distribution to Unitholders. The approval for the tax exemption under Section 13(12) of the Income Tax Act and the advance ruling from the IRAS issued under Section 108 of the Income Tax Act are subject to LMIR Trust satisfying the stipulated conditions. Where these conditions are not satisfied, or are no longer satisfied by LMIR Trust, the tax exemption and ruling may no longer apply. The approval and tax ruling are also granted based on the facts presented to IRAS, as well as the IRASs current interpretation of the existing tax laws. Where the facts turn out to be different from those represented to IRAS, or where there is a subsequent change in the tax laws, or a change in the
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Risk factors interpretation by the IRAS of the tax laws that affect the approval and the ruling, the tax exemption and ruling may no longer apply, possibly on a retroactive basis. Foreign Unitholders may not be permitted to participate in future rights issues by LMIR Trust. The Trust Deed provides that in relation to any rights issue, the Manager may, in its absolute discretion, elect not to extend an offer of Units under a rights issue to those Unitholders whose addresses, as registered with CDP , are outside Singapore. The rights or entitlements to the Units to which such Unitholders would have been entitled will be offered for sale and sold in such manner, at such price and on such other terms and conditions as the Manager may determine, subject to such other terms and conditions as the Trustee may impose. The proceeds of any such sale will be paid to the Unitholders whose rights or entitlements have been so sold, provided that where such proceeds payable to the relevant Unitholders are less than S$10.00, the Manager is entitled to retain such proceeds as part of the Deposited Property. The holding of the relevant holder of the Units may be diluted as a result of such sale. The actual performance of LMIR Trust and the Properties could differ materially from the forward-looking statements in this Prospectus. This Prospectus contains forward-looking statements regarding, among other things, forecast and projected distribution levels. These forward-looking statements are based on a number of assumptions which are subject to significant uncertainties and contingencies, many of which are outside of the Managers control (see Profit Forecast and Profit ProjectionAssumptions). In addition, LMIR Trusts revenue is dependent on a number of factors including the receipt of dividends and redemption proceeds from the Target Singapore SPCs and rent from the Properties held through the Singapore SPCs, which may decrease for a number of reasons including the lowering of occupancy and rental rates, insolvency or delay in rent payment by tenants. This may adversely affect LMIR Trusts ability to achieve the forecast and projected distributions as some or all events and circumstances assumed may not occur as expected, or events and circumstances may arise which are not currently anticipated. Actual results may be materially different from the forecast and projections. No assurance can be given that the assumptions will be realised and that actual distributions will be as forecast and projected. The Manager is not obliged to redeem Units. Unitholders have no right to request the Manager to redeem their Units while the Units are listed on the SGXST . It is intended that Unitholders may only deal in their listed Units through trading on the SGX-ST . The Units have never been publicly traded and the listing of the Units on the Main Board of the SGX-ST may not result in an active or liquid market for the Units. Prior to the Offering, there was no public market for the Units and an active public market for the Units may not develop or be sustained after the Offering. While the Manager has received a letter of eligibility from the SGXST to have the Units listed and quoted on the Main Board of the SGX-ST, listing and quotation does not guarantee the development of a trading market for the Units or, if a market does develop, the liquidity of that market for the Units. Prospective Unitholders should view the Units as illiquid and should be prepared to hold their Units for an indefinite length of time. Further, it may be difficult to assess LMIR Trusts performance against either domestic or international benchmarks. There is no assurance that the Units will remain listed on the SGX-ST. Although it is currently intended that the Units will remain listed on the SGX-ST, there is no guarantee of the continued listing of the Units. LMIR Trust may not continue to satisfy any future listing requirements of the SGX-ST. The Manager may change LMIR Trusts investment strategy as there is no restriction on changes in such investment and financing strategies. LMIR Trusts policy with respect to certain activities, including investments and acquisitions, will be determined by the Manager. The Manager has stated its intention to own and invest on a long-term basis in a diversified portfolio of income-producing real estate in Indonesia that are primarily used for retail and/or
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Risk factors retail-related purposes, and real estate related assets in connection with the foregoing purposes. Such strategy may not be changed for a period of three years commencing from the Listing Date (as the Listing Manual prohibits a departure from the Managers stated investment strategy for LMIR Trust for the said period unless otherwise approved by an Extraordinary Resolution passed by Unitholders). The Trust Deed grants the Manager wide power to invest in other types of assets, including real estate, real estate-related assets, as well as listed and unlisted securities in Singapore and other jurisdictions and the Manager may change its investment strategy after the expiry of the three-year period. There are risks and uncertainties with respect to the selection of investments and with respect to the investments themselves. Certain provisions of the Singapore Code on Take-overs and Mergers could have the effect of discouraging, delaying or preventing a merger or acquisition, which could adversely affect the market price of the Units. The MAS has announced on 8 June 2007 the decision of the Securities Industry Council to extend the ambit of the Take-over Code to REITs. While the MAS will be making amendments to the SFA and the Take-over Code, where necessary, to give effect to the extension of the Take-over Code to REITs in due course, the Securities Industry Council has recommended that parties engaged in take-over or merger transactions involving REITs comply with the Take-over Code prior to such amendments. The Take-over Code contains provisions that may delay, deter or prevent a future take-over or change in control of LMIR Trust. Under the Take-over Code, any person acquiring an interest, either individually or with parties acting in concert, in 30.0% or more of the Units (being voting units in LMIR Trust) may be required to extend a take-over offer for the remaining Units in accordance with the Take-over Code. A takeover offer is also required to be made if a person holding between 30.0% and 50.0% inclusive of the Units, either individually or in concert, acquires an additional 1.0% of the Units in any six-month period under the Take-over Code. While the application of the Take-over Code is intended to ensure equality of treatment among Unitholders, its provisions may discourage or prevent certain types of transactions involving an actual or threatened change of control of LMIR Trust and, as a result, may adversely affect the market price of the Units and the ability to realise any potential change of control premium. The price of the Units may decline after the Offering. The Offering Price of the Units is determined by agreement between the Manager and the Underwriters and may not be indicative of the market price for the Units after the completion of the Offering. The Units may trade at prices significantly below the Offering Price after the Offering. The trading price of the Units will depend on many factors, including: the perceived prospects of LMIR Trusts business and investments and the Indonesian retail real estate market; differences between LMIR Trusts actual financial and operating results and those expected by investors and analysts; changes in analysts recommendations or projections; changes in general economic, political or market conditions; the market value of LMIR Trusts assets; the perceived attractiveness of the Units against those of other equity or debt securities, including those not in the real estate sector; the balance of buyers and sellers of the Units; the future size and liquidity of the Singapore REIT market; any future changes to the regulatory system, including the tax system, both generally and specifically in relation to Singapore REITs; the ability of the Manager to successfully implement its investment and growth strategies; foreign exchange rates; and
86

Risk factors broad market fluctuations, including weakness of the equity market and increases in interest rates. For these and other reasons, the Units may trade at prices that are higher or lower than the NAV per Unit. To the extent that LMIR Trust retains operating cash flow for investment purposes, working capital reserves or other purposes, these retained funds, while increasing the value of its underlying assets, may not correspondingly increase the market price of the Units. Any failure on LMIR Trusts part to meet market expectations with regard to future earnings and cash distributions may adversely affect the market price for the Units. In addition, the Units are not capital-safe products and there is no guarantee that Unitholders can regain the amount invested. If LMIR Trust is terminated or liquidated, it is possible that investors may lose a part or all of their investment in the Units. LMIR Trust may be affected by the introduction of new or revised legislation, regulations, guidelines or directives affecting REITs. LMIR Trust may be affected by the introduction of new or revised legislation, regulations, guidelines or directives affecting REITs. There is no assurance that the MAS or any other relevant authority will not introduce new legislation, regulations, guidelines or directions which would adversely affect REITs generally, or LMIR Trust specifically.

87

Use of proceeds
The Manager intends to raise an aggregate of approximately S$848.3 million (based on the Offering Price) from the Offering as well as from the issuance of Cornerstone Units. The Manager intends to apply the total proceeds from the Offering and from the issuance of Cornerstone Units towards the following: (i) payment of the purchase consideration to the Vendors for the acquisition of all of the ordinary shares and redeemable preference shares in the Target Singapore SPCs at completion under the Singapore SPC Share Purchase Agreements; and

(ii) costs and expenses related to the Offering, and the issuance of the Cornerstone Units. The following tables, included for the purpose of illustration, set out the intended source and application of the total proceeds from the Offering and from the issuance of the Cornerstone Units. Based on the Offering Price and estimated issue costs and expenses of the Offering, and assuming that the Over-allotment Option has not been exercised:
Source (S$) Application (S$)

Units under the Offering. . . . . . . .

516,375,200

Cornerstone Units . . . . . . . . . . . . Total . . . . . . . . . . . . . . . . . . . . . .

331,956,000 848,331,200

Acquisition of all the ordinary shares and redeemable preference shares in the Target Singapore SPCs . . . . . . . . . . . . . Issue costs and expenses related to the Offering . . . . . . . . . . . . . . . Total

815,529,280 32,801,920 848,331,200

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Ownership of Units
PRINCIPAL UNITHOLDERS OF LMIR TRUST AND THEIR UNITHOLDINGS The following table sets out the principal Unitholders of LMIR Trust and their Unitholdings immediately after the Offering and the issuance of Cornerstone Units:
Units owned after Offering (assuming that the Over-allotment Option is not exercised) (000) (%) Units owned after Offering (assuming that the Over-allotment Option is exercised in full) (000) (%)

Lippo Strategic(1) . . . . . . . . . . . . . . . . . . . . . . . Mapletree LM(2) . . . . . . . . . . . . . . . . . . . . . . . . Total for Cornerstone Investors . . . . . . . . . . . Public and institutional investors . . . . . . . . . . . .

. . . .

287,695 127,250 414,945 645,469 1,060,414

27.1 12.0 39.1 60.9 100.0

190,875 127,250 318,125 742,289 1,060,414

18.0 12.0 30.0 70.0 100.0

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Notes:

(1) Lippo Holdings Inc, Lippo Capital Limited, Lippo Cayman Limited and Lanius Ltd are deemed to have interests in the Cornerstone Units held by Lippo Strategic due to their direct or indirect (as the case may be) interests in Lippo Strategic. (2) MIPL and Mapletree Dextra are deemed to have interests in the Cornerstone Units held by Mapletree LM due to their direct or indirect (as the case may be) interests in Mapletree LM. Concurrently with but separate from the Offering, the Cornerstone Investors will receive an aggregate of 414,945,000 Cornerstone Units constituting approximately 39.1% of the total issued Units as at the Listing Date, of which up to 96,820,000 Units, which constitute approximately 9.1% of the Units expected to be issued on the Listing Date, will be lent to the Underwriters by Lippo Strategic (as the Unit Lender) in connection with the Over-allotment Option. Lippo Strategic (also the Unit Lender), Lippo Holdings Inc, Lippo Capital Limited, Lippo Cayman Limited, Lanius Ltd, MIPL, Mapletree Dextra Pte Ltd and Mapletree LM have on 9 November 2007 agreed to certain lock-up periods in respect of their direct or indirect interests (as the case may be) in their respective interests in their Cornerstone Units, as at Listing Date, subject to certain exceptions (see Plan of DistributionLock-up Arrangements). The Cornerstone Investors (as set out below) have entered into Cornerstone Subscription Agreements with the Manager to subscribe for an aggregate of 414,945,000 Cornerstone Units at the Offering Price, conditional upon the Underwriting Agreement having been entered into and not having been terminated pursuant to its terms on or prior to the Listing Date. INFORMATION ON THE CORNERSTONE INVESTORS Lippo Strategic Lippo Strategic, a wholly-owned subsidiary of Lippo Holdings Inc, is a limited liability company incorporated in the British Virgin Islands on 2 March 2007. Lippo Holdings Inc is wholly-owned by Lippo Capital Limited, which is in turn wholly-owned by Lippo Cayman Limited. Lanius Ltd is the registered and legal owner of the entire issued share capital of Lippo Cayman Limited. Lanius Ltd is the trustee of a discretionary trust of which Dr Mochtar Riady is the founder. The share capital of Lippo Cayman Limited are assets comprised in such trust. The beneficiaries of the trust include Dr Mochtar Riady and his family members. Lippo Strategic will be subscribing for 287,695,000 Units, representing 27.1% of the total issued Units of LMIR Trust as at the Listing Date.
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Ownership of Units Mapletree LM Mapletree LM is a wholly-owned subsidiary of Mapletree Dextra, which is in turn, a wholly-owned subsidiary of MIPL. Mapletree LM is a private limited company incorporated in Singapore under the Companies Act on 29 May 2007. As at 29 May 2007, it has a paid-up capital of S$2.00 and its registered office is located at 1 Maritime Square, #13-01 HarbourFront Centre, Singapore 099253. MIPL is a leading Asia-focused real estate company based in Singapore. MIPL and its subsidiaries, comprising the Mapletree Group, have an asset base of approximately S$4.5 billion (as at 30 June 2007) comprising office, logistics, industrial, residential and retail/lifestyle properties. Mapletree LM will be subscribing for 127,250,000 Units, representing 12.0% of the total issued Units of LMIR Trust as at the Listing Date.

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Distributions
The distributable income of LMIR Trust (Distributable Income) is substantially based on the cash flow of LMIR Trust. The cash flow generated by the Indonesian SPCs, from owning and letting out spaces in the Retail Malls and the Retail Spaces, will be received by the Singapore SPCS in the form of (1) dividend income; (2) repayment of principal on the shareholders loans extended by the Singapore SPCs to the respective Indonesian SPCs and (3) interest payment on the shareholders loans. The amount of principal repayment on the shareholders loans will be mainly equivalent to the total amount of depreciation expense of the Properties, thereby extracting such cash trapped in the Indonesian SPCs. Thereafter, the cash flow will be received by LMIR Trust from the Target Singapore SPCs in the form of (1) tax-exempt dividends; and (2) proceeds from redemption of the redeemable preference shares in the Target Singapore SPCs. The Managers distribution policy is to distribute 100.0% of the tax-exempt income (after deduction of applicable expenses) and capital receipts of LMIR Trust for the Forecast Period 2007, Projection Year 2008 and Projection Year 2009 and at least 90.0% of the tax-exempt income (after deduction of applicable expenses) and capital receipts of LMIR Trust thereafter. The tax-exempt income comprises dividends received from the Target Singapore SPCs, which are ultimately paid out of income derived by the Indonesian SPCs from the leasing of the Properties. The capital receipts comprise amounts received by LMIR Trust from the redemption of redeemable preference shares in the Target Singapore SPCs. The Manager believes that it is appropriate to distribute 100.0% of the tax-exempt income (after deduction of applicable expenses) and capital receipts of LMIR Trust for the Forecast Period 2007, Projection Year 2008 and Projection Year 2009 given that in relation to the Retail Spaces, the Master Lessee under each of the Master Lease Agreements is responsible for all repair and replacement works in relation to the mechanical and electrical equipment which are of a capital nature for the first 30 months of the lease term. In addition, asset enhancement works are currently being carried out at The Plaza Semanggi and have recently been completed at Bandung Indah Plaza, Mal Lippo Cikarang and Ekalokasari Plaza, and the Manager expects the capital expenditure required for each of these Retail Malls subsequent to the carrying out of asset enhancement works to be low for the period leading up to the end of Projection Year 2009. The Managers distribution policy for the period subsequent to the Projection Year 2009 is intended to provide for some flexibility in the retention of some of the tax-exempt income (after deduction of applicable expenses) and capital receipts of LMIR Trust for the benefit of LMIR Trust. The actual level of distribution will be determined at the Managers discretion. The actual proportion of taxexempt income and capital receipts to be distributed to Unitholders beyond Projection Year 2009 may be greater than 90.0% if the Manager believes it to be appropriate, having regard to LMIR Trusts funding requirements, other capital management considerations and ensuring the overall stability of distributions. Distributable Income is generally calculated as follows: Indonesian SPCs level: Consolidated net profit from operations is calculated by: a) b) Adding all NPI of the Indonesian SPCs to arrive at consolidated NPI; Deducting general and administrative expenses (non property-related) and all relevant domestic taxes (if any), including but not limited to final income tax on rental income received and Indonesian withholding tax on offshore interest and dividend payable at the Indonesian SPCs level; and Adding or deducting (as the case may be) the difference (if any) between the amount of rent due for the relevant period and the amount recorded as rental revenue arising from amortisation of rent free periods.
91

c)

Distributions Singapore SPCs level and LMIR Trust level: Distributable Income is derived from consolidated net profit from operations by making the following adjustments: a) b) c) Deducting fees payable to the Manager, general and administrative expenses, other trust expenses, hedging costs and expenses and taxes (if any), at the Singapore SPCs and LMIR Trust level; Adding any income from external parties received by the Singapore SPCs and LMIR Trust (for example, interest income on placement of cash balances with banks); Deducting unrealised income, gains from the disposal of shares and properties and adding back unrealised expenses (unrealised income and expenses include unrealised exchange differences and accretion and fair value adjustments relating to financial instruments and real properties); Adding back trust expenses (for example, the portion of the Managers management fees) paid in units (as these are non-cash items); and Adding back non-recurring expenses (as deemed appropriate by the Manager).

d) e)

After LMIR Trust has been admitted to the Main Board of the SGX-ST, LMIR Trust will make distributions to Unitholders on a quarterly basis, with the amount calculated as at 31 March, 30 June, 30 September and 31 December each year for the three-month period ending on each of the said dates. However, LMIR Trusts first distribution after the Listing Date will be for the period from the Listing Date to 31 March 2008 and will be paid by the Manager on or before 30 May 2008. Subsequent distributions will take place on a quarterly basis. In the event that there are gains arising from sales of real properties either directly or indirectly through the sales of the shares in the Indonesian SPCs or the Singapore SPCs, and only if such gains are surplus to the business requirements and needs of LMIR Trust and its taxability or otherwise confirmed by the IRAS in the event that the gains arise from the sale of shares in the Singapore SPCs or from the sale of shares in the Indonesian SPCs by the Singapore SPCs, the Manager may, at its discretion, direct the Trustee to distribute such gains. Such gains, if not distributed, will form part of the Deposited Property. LMIR Trusts primary source of liquidity to fund distributions, payment of non-property expenses and other recurring capital expenditure will be from the receipts of Gross Revenue and any future borrowings. Under the Property Funds Guidelines, if the Manager declares a distribution that is in excess of profits, the Manager should certify, in consultation with the Trustee, that it is satisfied on reasonable grounds that, immediately after making the distribution, LMIR Trust will be able to fulfil, from the Deposited Property, the liabilities of LMIR Trust as they fall due. The certification by the Manager should include a description of the distribution policy and the measures and assumptions for deriving the amount available to be distributed from the deposited property of the property fund. The certification should be made at the time the distribution is declared.

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Exchange rates and exchange controls

Bank Indonesia is the sole issuer of Indonesian Rupiah and is responsible for maintaining the stability of the Indonesian Rupiah. Since 1970, Indonesia has implemented three exchange rate systems: (i) (ii) (iii) a fixed rate between 1970 and 1978; a managed floating exchange rate system between 1978 and 1997; and a free floating exchange rate system since 14 August 1997.

Under the second system, Bank Indonesia maintained stability of the Indonesian Rupiah through a trading band policy, pursuant to which Bank Indonesia would enter the foreign currency market and buy or sell Indonesian Rupiah, as required, when trading in the Indonesian Rupiah exceeded bid and offer prices announced by Bank Indonesia on a daily basis. On 14 August 1997, Bank Indonesia terminated the trading band policy and permitted the exchange rate for the Indonesian Rupiah to float without an announced level at which it would intervene, which resulted in a substantial decrease in the value of the Indonesian Rupiah relative to certain foreign currencies, including the US dollar and the Singapore dollar. Under the current system, the exchange rate of the Rupiah is determined solely by the market, reflecting the interaction of supply and demand in the market. Bank Indonesia may take measures, however, to maintain a stable exchange rate. The following table sets out the average, high and low exchange rates between Indonesian Rupiah and Singapore dollars (in Indonesian Rupiah per Singapore dollar) for the periods indicated. No representation is made that the Indonesian Rupiah amounts actually represent such Singapore dollar amounts or could have been or could be converted into Singapore dollars at the rate indicated, at any other rate, or at all.
Indonesian Rupiah per S$1.00 Period Average(1) Rp. High(2) Rp. Low(2) Rp.

2001 . . . . . . . . . . 2002 . . . . . . . . . . 2003 . . . . . . . . . . 2004 . . . . . . . . . . 2005 . . . . . . . . . . 2006 . . . . . . . . . . January 2007 . . . . February 2007 . . . March 2007 . . . . . April 2007 . . . . . . May 2007 . . . . . . . June 2007 . . . . . . July 2007 . . . . . . . August 2007. . . . . September 2007. . Notes:

.. .. .. .. .. .. .. .. .. .. .. .. .. .. ..

.. .. .. .. .. .. .. .. .. .. .. .. .. .. ..

.. .. .. .. .. .. .. .. .. .. .. .. .. .. ..

.. .. .. .. .. .. .. .. .. .. .. .. .. .. ..

. . . . . . . . . . . . . . .

.. .. .. .. .. .. .. .. .. .. .. .. .. .. ..

.. .. .. .. .. .. .. .. .. .. .. .. .. .. ..

.. .. .. .. .. .. .. .. .. .. .. .. .. .. ..

.. .. .. .. .. .. .. .. .. .. .. .. .. .. ..

.. .. .. .. .. .. .. .. .. .. .. .. .. .. ..

.. .. .. .. .. .. .. .. .. .. .. .. .. .. ..

.. .. .. .. .. .. .. .. .. .. .. .. .. .. ..

. . . . . . . . . . . . . . .

.. .. .. .. .. .. .. .. .. .. .. .. .. .. ..

.. .. .. .. .. .. .. .. .. .. .. .. .. .. ..

.. .. .. .. .. .. .. .. .. .. .. .. .. .. ..

.. .. .. .. .. .. .. .. .. .. .. .. .. .. ..

.. .. .. .. .. .. .. .. .. .. .. .. .. .. ..

.. .. .. .. .. .. .. .. .. .. .. .. .. .. ..

. . . . . . . . . . . . . . .

.. .. .. .. .. .. .. .. .. .. .. .. .. .. ..

5,709.0 5,502.6 4,919.9 5,219.3 5,832.9 5,769.5 5,902.4 5,913.5 6,013.7 6,001.8 5,800.3 5,839.6 5,983.9 6,148.9 6,155.4

6,617.0 5,694.8 5,157.6 5,706.7 6,406.6 5,953.6 5,930.1 5,976.3 6,046.6 6,021.7 5,967.5 5,877.8 6,007.0 6,175.8 6,230.1

4,797.8 4,824.5 4,651.4 4,902.6 5,529.8 5,541.9 5,847.9 5,869.4 5,989.2 5,977.6 5,655.6 5,803.7 5,956.4 6,117.0 6,081.5

The rates are the foreign exchange rates as quoted on Bloomberg. Bloomberg has not provided its consent, for the purposes of section 249 (read with section 302) of the SFA, to the inclusion of the information on the exchange rates from Bloomberg and is therefore not liable for such information under sections 253 and 254 (read with section 302) of the SFA. While the Manager has taken reasonable action to ensure that the information has been reproduced in its proper form and context, and that it has been extracted accurately and fairly, neither the Manager nor any other party has conducted an independent review of, nor verified the accuracy of, such information.
(footnotes continued on following page)

93

Exchange rates and exchange controls

(1) For full years, the average shown is calculated based on the middle exchange rate by Bloomberg on the last day of each month during the year indicated. For monthly averages from January 2007 to September 2007, the average shown is calculated based on the daily middle exchange rates during the month indicated. (2) For full years, the high and low amounts are determined based on the month-end middle exchange rate by Bloomberg during the year indicated. The high and low figures for 1 January 2007 to 30 September 2007 are determined based on the daily middle exchange rates during the month indicated. Source: Bloomberg Currently, no exchange control restrictions exist in Indonesia. The Indonesian Rupiah has been, and in general is, freely convertible. Bank Indonesia has introduced regulations to restrict the movement of Indonesian Rupiah from banks within Indonesia to banks domiciled outside Indonesia or to an offshore branch or office of an Indonesian bank, or any investment in Rupiah denomination with foreign parties and/ or Indonesian citizens domiciled or permanently residing outside Indonesia without underlying trade or investment reasons, thereby limiting offshore trading to existing sources of liquidity. In addition, Bank Indonesia has the authority to request information and data concerning the foreign exchange activities of all people and legal entities that are domiciled, or who plan to reside, in Indonesia for at least one year. Bank Indonesia regulations also require resident banks and companies that have total assets or total annual gross revenues of at least Rp. 100 billion to report to Bank Indonesia all data concerning their foreign currency activities, if the transaction is not conducted via a domestic bank or domestic non-bank financial institution (for example, insurance companies, securities companies, finance companies, or venture capital companies). However, if the transaction is conducted via a domestic bank and/or domestic non-bank financial institution, the requirement to report to Bank Indonesia is imposed on the relevant Indonesian banks or non-bank financial institutions that carried out the transaction. The transactions that must be reported include receipt and payment of foreign currency through bank accounts outside of Indonesia.

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Capitalisation
The following table sets forth the pro forma capitalisation of LMIR Trust as at the Listing Date and after application of the total proceeds from the Offering and the issuance of Cornerstone Units, based on the Offering Price. The information in the table below should be read in conjunction with Use of Proceeds and StrategyCapital and Risk Management Strategy.
Based on the Offering Price (S$000) pro forma

Net assets attributable to Unitholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Total capitalisation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

963,316 963,316

95

Unaudited pro forma consolidated balance sheet as at the Listing Date

The Manager is unable to prepare historical pro forma financial statements of LMIR Trust for the following reasons: Gajah Mada Plaza and Mal Lippo Cikarang were recently acquired by the respective Retail Mall Indonesian SPCs, namely, PT Graha Baru Raya and PT Graha Nusa Raya, in early March 2006. Historical financial information for these two Retail Malls prior to their acquisition dates is not available from the previous vendors and, there is no comparable historical financial information for the full years ended 31 December 2004 and 31 December 2005; Bandung Indah Plaza, Ekalokasari Plaza and Mal Lippo Cikarang have recently undergone major refurbishments and other repositioning initiatives. Given the repositioning initiatives, the Manager is of the view that any attempt to present the historical pro forma financial performance based on the actual results of these three Retail Malls prior to their repositioning initiatives may not be comparable to the expected results of these Retail Malls after the repositioning initiatives; Cibubur Junction commenced its retail space leasing operations in September 2005. Given that there were no activities for Cibubur Junction prior to September 2005, the historical financial information on Cibubur Junctions performance would not be available for the full financial years ended 31 December 2004 and 31 December 2005. Accordingly, any historical pro forma financial information presented in respect of Cibubur Junctions short period of operations is unlikely to be meaningful or accurately reflect its financial performance; Each of the Retail Spaces was wholly-owned by Matahari up to the Listing Date and was held for the use of Mataharis retail businesses. As the activities relating to the Retail Spaces form an intrinsic part of Mataharis core business operations, Matahari does not keep separate financial records on these Retail Spaces. Accordingly, historical financial data is unavailable for each Retail Space; and If historical pro forma financial information is prepared based on the terms of the Master Lease Agreements to be entered into between the Master Lessee and the relevant Retail Space Indonesian SPC, such information will be in the nature of a forecast and will not reflect the historical financial results and position of LMIR Trust with respect to the Retail Spaces. Assumptions and bases which are prospective in nature would need to be made if LMIR Trust is to assume that such arrangements were in place throughout the period covered by the historical pro forma financial information. As such, the Manager believes that such historical pro forma financial information will be of little value to investors in deciding whether to acquire the Units and a profit forecast and profit projection based on, among other things, the terms of the Master Lease Agreements would be more meaningful to investors. For the reasons stated above, the SGX-ST has granted LMIR Trust a waiver from the requirement to prepare historical pro forma statements of total return, cash flow statements and balance sheets, subject to the inclusion of the following financial information in this Prospectus: profit forecast for Forecast Period 2007 and profit projections for Projection Year 2008 and Projection Year 2009; pro forma consolidated balance sheet of LMIR Trust as at the Listing Date; and disclosure of the reasons why the historical pro forma financial statements cannot be provided and the waiver granted by the SGX-ST. The Unaudited Pro Forma Consolidated Balance Sheet as at the Listing Date has been prepared on the bases set out in Section C of Appendix BIndependent Accountants Report on the Unaudited Pro Forma Consolidated Balance Sheet as at the Listing Date. The Unaudited Pro Forma Consolidated Balance Sheet should be read together with these bases. The objective of the Unaudited Pro Forma Consolidated Balance Sheet as at the Listing Date is to show, for illustrative purposes, what the financial position of LMIR Trust might be at the Listing Date, prepared on the bases set out in Section C of Appendix BIndependent Accountants Report on the Unaudited Pro Forma Consolidated Balance Sheet as at the Listing Date. The Unaudited Pro Forma Consolidated
96

Unaudited pro forma consolidated balance sheet as at the listing date Balance Sheet as at the Listing Date, because of its nature, is not necessarily indicative of LMIR Trusts actual financial position on the Listing Date. For the purpose of the consolidation, the balance sheets of the Retail Mall and Retail Space Indonesian and Singapore SPCs have been translated into Singapore dollars based on the exchange rate of Rp. 5,900 = S$1.00.
Unaudited pro forma consolidated balance sheet as at the Listing Date (S$000)

ASSETS Current assets Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Trade and other receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Total current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Non-current assets Investment properties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Total non-current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . LIABILITIES Current liabilities Trade and other payables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Current tax payable. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Current portion of finance leases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Total current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Non-current liabilities Deferred tax liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Deferred income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Other payables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Finance leases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Total non-current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Total liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Unitholders funds Net assets attributable to Unitholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Total Unitholders funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Total liabilities and Unitholders funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Number of Units in issue (000) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . NAV per unit (S$) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

86,921 13,583 100,504 1,004,679 1,004,679 1,105,183

1,787 4,463 148 6,398 62,366 66,849 5,213 1,041 135,469 141,867 963,316 963,316 1,105,183 1,060,414 0.91

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Profit forecast and profit projection

Statements contained in the Profit Forecast and Profit Projection section that are not historical facts may be forward-looking statements. Such statements are based on the assumptions set out on pages 100 to 108 of this Prospectus and are subject to certain risks and uncertainties which could cause actual results to differ materially from those forecast and projected. Under no circumstances should the inclusion of such information herein be regarded as a representation, warranty or prediction with respect to the accuracy of the underlying assumptions by LMIR Trust, the Manager, the Underwriters, the Sponsor, the Property Manager, the Trustee or any other person, nor that these results will be achieved or are likely to be achieved. See Forward-Looking Statements and Risk Factors. Investors in the Units are cautioned not to place undue reliance on these forward-looking statements which are valid only as at the date of this Prospectus. None of LMIR Trust, the Manager, the Financial Adviser, the Underwriters, the Sponsor, the Property Manager, the Trustee and the Unit Lender guarantees the performance of LMIR Trust, the repayment of capital or the payment of any distributions, or any particular return on the Units. The forecast and projected yields stated in the following table are calculated based on (i) the Offering Price and (ii) the assumption that the Listing Date is 1 July 2007. Such yields will vary accordingly since the Listing Date will be after 1 July 2007 and in relation to investors who purchase Units in the secondary market at a market price that differs from the Offering Price. The following table below sets forth LMIR Trusts forecast and projected consolidated statements of total return for Forecast Period 2007, Projection Year 2008 and Projection Year 2009, respectively. The financial year-end of LMIR Trust is 31 December. For the purpose of the profit forecast and profit projections, LMIR Trusts first accounting period is assumed to be for the period from 1 July 2007, being the date of its establishment, to 31 December 2007. The profit forecast and profit projections will be different if the date of establishment differs from 1 July 2007 or if the end of the first financial period differs from 31 December 2007. The profit forecast and profit projections should be read together with the report set out in Appendix AIndependent Accountants Report on the Profit Forecast and Profit Projection as well as the assumptions and the sensitivity analysis set out in this section of the Prospectus. The following table sets forth LMIR Trusts Forecast and Projected Consolidated Statement of Total Return for Forecast Period 2007, Projection Year 2008 and the Projection Year 2009 prepared based on the Offering Price. Forecast and Projected Consolidated Statement of Total Return
Forecast Period 2007 (S$000) Projection Year 2008 (S$000) Projection Year 2009 (S$000)

Gross Revenue Gross Rent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Carpark income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Other income. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Total Gross Revenue . . . . . . . . . . . . . . . . . . . . . . . . . Property Operating Expenses Land rental . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Property management fees . . . . . . . . . . . . . . . . . . . . . Other property operating expenses . . . . . . . . . . . . . . . Total Property Operating Expenses . . . . . . . . . . . . . Net Property Income . . . . . . . . . . . . . . . . . . . . . . . . . Interest income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Financial expense . . . . . . . . . . . . . . . . . . . . . . . . . . . .

35,018 3,782 1,346 40,146 (661) (1,475) (461) (2,597) 37,549 789 (201)

74,660 7,356 2,804 84,820 (1,618) (3,134) (583) (5,335) 79,485 1,157 (365)

81,632 7,053 2,895 91,580 (1,836) (3,423) (447) (5,706) 85,874 796 (339)

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Profit forecast and profit projection

Forecast Period 2007 (S$000) Projection Year 2008 (S$000) Projection Year 2009 (S$000)

Administrative expenses Managers management fees. . . . . . . . . . . . . . . . . . . . Trustees fee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Other trust operating expenses . . . . . . . . . . . . . . . . . . Total administrative expenses . . . . . . . . . . . . . . . Total return for the period before tax and distribution and revaluation . . . . . . . . . . . . . . . Surplus on the revaluation on investment properties Total return for the period before tax and distribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Income tax . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Withholding tax . . . . . . . . . . . . . . . . . . . . . . . . . . . . Deferred tax . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. .. .. .. .. .. ..

(2,883) (191) (607) (3,681) 34,456 207,887 242,343 (4,173) (2,893) (62,366) 172,911

(5,942) (332) (830) (7,104) 73,173 73,173 (8,714) (5,940) 58,519

(6,198) (332) (848) (7,378) 78,953 78,953 (9,317) (6,520) 63,116

Total return for the period after tax before distribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Distribution to Unitholders

Forecast Period 2007 (S$000)

Projection Year 2008 (S$000)

Projection Year 2009 (S$000)

Total return for the period after tax before distribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Add back/(less) non-cash items: Management fees(1) . . . . . . . . . . . . . . . . . . . . . . . . . Surplus on revaluation of investment properties net of deferred tax(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . Reversal of FRS adjustment on rental deposit(3) . . . . Total Unitholders distribution . . . . . . . . . . . . . . . . . Unitholders distribution: as distributions from operations . . . . . . . . . . . . . . . . as return of capital(4) . . . . . . . . . . . . . . . . . . . . . . . . Total Unitholders distribution . . . . . . . . . . . . . . . . . Notes:

172,911 1,503 (145,521) 201 29,094 23,035 6,059 29,094

58,519 3,180 365 62,064 48,044 14,020 62,064

63,116 3,435 339 66,890 55,487 11,403 66,890

(1) This relates to the portion of the management fees which are payable in the form of Units. (2) It is assumed that all of the Properties are purchased at a total consideration of approximately S$796.8 million based on the Offering Price. The purchase consideration of the Properties is determined by the difference between the purchase consideration of the Singapore SPCs (see Certain Agreements relating to LMIR Trust and the PropertiesDescription of the Singapore SPC Share Purchase Agreements for the formula of determining this purchase consideration) and the fair value of all the net identifiable assets and liabilities of the Singapore SPCs acquired save for the Properties. The surplus on revaluation of the investment properties relates to the revaluation of the Properties to their fair value of S$1,004.7 million immediately upon their acquisition and the capital expenditures expected to be incurred in the Forecast Period 2007. The fair value of S$1,004.7 million is based on the value appraised by Knight Frank as at 30 June 2007. It is assumed that the fair value of the Properties will only increase by the amount of capital expenditure expected to be incurred in the Forecast Period 2007, the Projection Year 2008 and the Projection Year 2009 and that there is no change in the exchange rate between the Singapore dollar and the Indonesian Rupiah as at the end
(footnotes continued on following page)

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Profit forecast and profit projection of Forecast Period 2007 and the Projection Year 2008 and the Projection Year 2009. Notwithstanding whether the valuation of Knight Frank or Colliers is adopted, such adoption has no impact on the distribution to Unitholders. (3) This relates to notional interest expense which has no impact on the distribution to Unitholders. (4) The return of capital comprises the amounts received by LMIR Trust from the redemption of its investment in the redeemable preference shares in the Target Singapore SPCs (see Assumptions(IX) Distributable Income and Distributions). Forecast and projected distributions to Unitholders
Forecast Period 2007 Based on the Offering Price Projection Year 2008 Based on the Offering Price Projection Year 2009 Based on the Offering Price

Number of Units eligible for distribution (000)(1) . . . . . Distribution per Unit (cents) . . . . . . . . . . . . . . . . . . . Offering Price per Unit (S$) . . . . . . . . . . . . . . . . . . . Distribution yield (%) . . . . . . . . . . . . . . . . . . . . . . .

1,060,414(2) 2.74 0.80 6.9(5)

1,062,291(3) 5.84 0.80 7.3

1,066,266(4) 6.27 0.80 7.8

Notes: (1) The increase in the number of Units in Projection Year 2008 and Projection Year 2009 are due to the issue of Units to the Manager for the payment of 100.0% of the Managers Performance Fees for Forecast Period 2007 and Projection Year 2008 in the form of Units. These Units are assumed to be issued at the Offering Price. (2) Based on the number of Units that are assumed to be in issue as at the Listing Date. It is assumed that the number of Units eligible for distribution is the same throughout Forecast Period 2007. (3) Based on the number of Units that are assumed to be in issue on 1 January 2008. It is assumed that the number of Units eligible for distribution is the same throughout Projection Year 2008. (4) Based on the number of Units that are assumed to be in issue on 1 January 2009. It is assumed that the number of Units eligible for distribution is the same throughout Projection Year 2009. (5) Annualised for Forecast Period 2007. ASSUMPTIONS The Manager has prepared the profit forecast for Forecast Period 2007 and the profit projections for Projection Year 2008 and Projection Year 2009 based on the assumptions listed below. The Manager considers these assumptions to be appropriate and reasonable as at the date of this Prospectus. However, recipients of this Prospectus and all prospective investors in the Units should consider these assumptions as well as the profit forecast and profit projection and make their own assessment of the future performance of LMIR Trust. The major assumptions made in preparing the forecast and projected Consolidated Statement of Total Return are set out below. (I) Gross Revenue

Gross revenue is the aggregate of Gross Rent, carpark income and other income earned primarily from the Properties. A summary of the key assumptions used in calculating the Gross Revenue is set out below: (a) Gross Rent Gross Rent of Retail Malls comprises base rental income and service charges. Gross Rent of Retail Spaces comprises base rental income. The percentage of forecast and projected Gross Rent attributable to Committed Leases (including letters of offer which are to be followed up with tenancy agreements to be
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Profit forecast and profit projection signed by the parties) for the Properties as at 30 June 2007 (for Retail Malls1) and as at the Listing Date (for Retail Spaces) are estimated as follows:
Forecast Period 2007 (%) Projection Year 2008 (%) Projection Year 2009 (%)

Gross Rent attributable to Committed Leases for Retail Malls (as percentage of total Gross Rent). . . . Gross Rent attributable to Committed Leases for Retail Spaces (as percentage of total Gross Rent) . . Gross Rent attributable to Committed Leases for the Properties (as percentage of total Gross Rent). . . . . Base rental income

72.4 18.9 91.3

62.7 18.2 80.9

50.0 16.8 66.8

Base rental income comprises rental income derived from the Retail Malls and Retail Spaces (net of rebates) pursuant to tenant leases. Retail Malls In order to forecast and project base rental income, the Manager has used rents payable under Committed Leases (including letters of offer which are to be followed up with tenancy agreements to be signed by the parties). For Forecast Period 2007, the Projection Year 2008 and the Projection Year 2009, the Manager has forecast and projected that the base rental income from the Retail Malls will be S$33.5 million, S$71.3 million and S$77.8 million respectively. Approximately, S$25.3 million (75.6%), S$46.8 million (65.7%) and S$40.8 million (52.4%) respectively of such forecast and projected base rental income is attributable to Committed Leases (including letters of offer which are to be followed up with tenancy agreements to be signed by the parties). Following the expiry of a Committed Lease during Forecast Period 2007, Projection Year 2008 and Projection Year 2009, the Manager has used the following process to forecast and project the base rental income for the periods following such expiry: the Manager has assessed the market rent for the NLA of each of the Retail Malls as at 30 June 2007. The market rent is the rent which the Manager believes could be achieved if each lease was renegotiated as at 30 June 2007 and is estimated with reference to the rent payable pursuant to comparable leases for tenancies that have recently been negotiated, the effect of competing retail malls, assumed tenant retention rates on lease expiry, likely market conditions, inflation levels and tenant demand levels. if a Committed Lease expires in Forecast Period 2007 or Projection Year 2008 and Projection Year 2009, the Manager has assumed that the rental rate for a new lease (or a lease renewal) which commences in Forecast Period 2007 or Projection Year 2008 and Projection Year 2009 is the actual rent contracted immediately prior to the Committed Leases expiry adjusted by the forecast or projected growth rate in accordance with the methodology set out in renewal rental rates discussed below or the actual rent (if the lease agreement or letter of offer has been entered into). Renewal leases and vacancy allowances In respect of the leases that have been contracted as at 30 June 2007 and are expiring in Forecast Period 2007, Projection Year 2008 or Projection Year 2009 (other than the renegotiated Matahari leases), the Manager has assumed that 80% of these leases will be renewed immediately for the same contractual period and will not experience any vacancy period unless the actual vacancy periods are known. The remaining 20% of these leases are assumed to experience a two month vacancy period before rent becomes payable under a new lease. The assumed renewal rental rates are discussed below.
1

Certain tenancy lease agreements with Matahari and certain of its related entities were renegotiated after 30 June 2007 and the revised terms, including the revised rents, will take effect from the Listing Date. Such revised rents have formed the basis for the base rental income from these tenancies and have been used to estimate the base rental income from these tenancies for Forecast Period 2007, Projection Year 2008 and Projection Year 2009.
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Profit forecast and profit projection New leases In order to forecast and project base rental income for new leases, the Manager has applied the market rent taking into account market conditions, tenant demand levels, the expected occupancy rate, comparable leases for tenancies that have been recently negotiated as well as referred to the market research report of the Retail Malls. In addition, Lippo Strategic has entered into a Rental Guarantee Deed with the relevant Retail Mall Singapore SPCs pursuant to which Lippo Strategic will (i) provide a rental guarantee to the relevant Retail Mall Singapore SPC in respect of existing and new units in the respective Retail Malls which are untenanted and (ii) undertake to pay to the relevant Retail Mall Singapore SPC any shortfall in the maintenance and operation costs which the relevant Operating Company has undertaken to bear under the respective Operating Costs Agreement. The Rental Guarantee Deed covers the period commencing from the Listing Date up to 31 December 2009. Pursuant to the Rental Guarantee Deeds, Lippo Strategic is obliged to pay to the Retail Mall Singapore SPCs a specified sum in respect of each Retail Mall for every year during the said period. The first of such payments will be paid on or before 31 January 2008, and subsequent payments will be made on a quarterly basis thereafter. In the event any of the specified units in the relevant Retail Mall becomes tenanted during such period, the amount of the specified sum payable by Lippo Strategic in respect of such Retail Mall will be reduced by the amount of the rental payable under the relevant tenancy, regardless of whether such rental is received by the owner of the relevant Retail Mall and notwithstanding that such tenancy may be or is terminated prior to the expiry of such period. (See Certain Agreements Relating to LMIR Trust and the PropertiesDescription of the Rental Guarantee Deeds.) Occupancy rates Based on the assumptions and basis as discussed above, the assumptions on rental rates below and management strategy (see Strategy), the forecast and projected occupancy rates as at 31 December 2007, 2008 and 2009 as compared against the actual occupancy rates as at 30 June 2007 for the Retail Malls are set out below:
Occupancy rate as at 30 June 2007 (%) Occupancy rate as at 31 December 2007 (%) Occupancy rate as at 31 December 2008 (%) Occupancy rate as at 31 December 2009 (%)

Gajah Mada Plaza . . . . Cibubur Junction. . . . . . The Plaza Semanggi . . Mal Lippo Cikarang. . . . Ekalokasari Plaza . . . . . Bandung Indah Plaza . . Istana Plaza . . . . . . . . . Weighted Average . . .

89.1 86.4 96.4 96.3 87.3 83.2 98.9 91.6

94.7 93.5 97.0 96.8 78.5 87.2 99.1 93.2

95.9 98.6 97.8 98.5 91.4 91.9 99.4 96.5

99.3 99.6 98.5 98.4 99.6 99.5 99.2 99.1

Renewal rental rates When leases in the Retail Malls are renewed in Forecast Period 2007, Projection Year 2008 and Projection Year 2009, the Manager has assumed these leases will be renewed based on the actual rent contracted immediately prior to the previous leases expiry increased by the rental growth rates below:
Rental growth rate Forecast Period 2007 (%) Rental growth rate Projection Year 2008 (%) Rental growth rate Projection Year 2009 (%)

Gajah Mada Plaza . . . . . . . . . . . . . . . . Cibubur Junction. . . . . . . . . . . . . . . . . . The Plaza Semanggi . . . . . . . . . . . . . . Mal Lippo Cikarang. . . . . . . . . . . . . . . . Ekalokasari Plaza . . . . . . . . . . . . . . . . . Bandung Indah Plaza . . . . . . . . . . . . . . Istana Plaza . . . . . . . . . . . . . . . . . . . . .
102

. . . . . . .

12 12 10 12 15 12 15

12 12 10 12 15 12 15

12 12 10 12 15 12 15

Profit forecast and profit projection Having assessed the likely market conditions and having taken into account the leases that have recently been renewed, the demand for retail spaces, competing malls and market rent used in the market research reports (see Appendix FIndependent Report on the Indonesian Retail Property Market), the Manager believes the estimated rental growth rates are reflective of the likely market rent that can be obtained for the respective Retail Malls if the leases are renewed. The revised rent is then calculated as follows: A x [1+ (N x Rental growth rate factor in the table above)] = Revised rental rate A being the rent immediately prior to the expiry of the tenancy lease agreement; and N being the lease period (years) prior to the expiry of the existing lease. Based on the formula above, the average specialty rent per sq m for Forecast Period 2007, Projection Year 2008 and Projection Year 2009 are as follows:
Forecast Period 2007 (Rp. 000 per sq m) Projection Year 2008 (Rp. 000 per sq m) Projection Year 2009 (Rp. 000 per sq m)

Gajah Mada Plaza . . . . . . . . . . . . . . . . . . . . Cibubur Junction . . . . . . . . . . . . . . . . . . . . . . The Plaza Semanggi. . . . . . . . . . . . . . . . . . . Mal Lippo Cikarang . . . . . . . . . . . . . . . . . . . . Ekalokasari Plaza . . . . . . . . . . . . . . . . . . . . . Bandung Indah Plaza . . . . . . . . . . . . . . . . . . Istana Plaza . . . . . . . . . . . . . . . . . . . . . . . . .

156 216 124 172 163 281 211

187 224 129 198 217 291 222

247 236 152 226 296 311 233

Service charges Service charges paid by tenants are applied towards the operating expenses of the Properties which comprises (i) maintenance expenses (ii) utility expenses (iii) property tax (iv) insurance and (v) other expenses relating to the operation of LMIR Trusts malls. For the Forecast Period 2007, Projection Year 2008 and 2009, service charges and the above mentioned operating costs are accrued to the Operating Company pursuant to each Operating Costs Agreement to be entered between the relevant Retail Mall Indonesian SPC and Lippo Strategic. The Operating Costs Agreement will lapse on 31 December 2009 and thereafter, all service charges and operating costs related to the maintenance and operation of the Retail Malls will accrue to LMIR Trust (see Certain Agreements Relating to LMIR Trust and the PropertiesDescription of the Operating Costs Agreements). Retail Spaces Each of the Retail Spaces will be fully leased to Matahari under Master Lease Agreements for an initial term of 10 years, with an option to renew for another 10 years (see Certain Agreements relating to LMIR Trust and the PropertiesDescription of the Master Lease Agreements). The Master Lessee will pay a fixed rent for Forecast Period 2007. The fixed rent for the respective Retail Spaces for Forecast Period 2007 is as follows:
Retail Spaces Fixed rent (S$000)

Mall WTC Matahari Units . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Metropolis Town Square Units . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Depok Town Square Units . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Java Supermall Units . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Malang Town Square Units . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Plaza Madiun. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Grand Palladium Medan Units . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . .

860 1,173 878 852 851 1,098 903 6,615

Total base rental income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

The Master Lease Agreements contain provisions for increase in rental revenues through step-ups in the base rent of 8.0% per annum for the first four years and thereafter, in accordance with a formula that takes
103

Profit forecast and profit projection into account the increase in the Master Lessees net revenue. (See Certain Agreements Relating to LMIR Trust and the PropertiesDescription of the Operating Costs Agreements). Discounts from market rates are generally given to tenants which occupy a large amount of lettable space. The extent of such discounts depends on, but is not limited to, factors such as the amount of lettable space occupied by the tenant, the relevant landlords analysis of the importance of the tenant in increasing shopper traffic, especially if the tenant is an anchor tenant, and the landlords overall marketing strategy and positioning. The valuation for the seven Retail Spaces by Knight Frank has been carried out using a discounted cashflow analysis over a ten-year horizon from 30 June 2007 to 30 June 2017 based on the terms and conditions as stipulated in the Master Lease Agreements (see Appendix EIndependent Property Valuation Summary Reports). The Directors of the Manager are of the view that the rental terms for the period from FY 2008 to FY 2011 are on normal commercial terms and are not prejudicial to the interests of LMIR Trust and its minority Unitholders. (b) Carpark income

Carpark income includes revenue earned from the operations of the carparks located at the Retail Malls. The carpark will be operated by third party carpark operators who in turn pay a fixed rent to LMIR Trust. Total carpark income as a percentage of the total Gross Revenue is estimated to be 9.4% for Forecast Period 2007, and 8.7% and 7.7% for Projection Year 2008 and Projection Year 2009, respectively. (c) Other income

Other income includes revenue earned from renting out signage, billboards, etc located at the Retail Malls. The assessment of other income is based on existing agreements, historical income collections and the Managers assessment of the Retail Malls. Total other income as a percentage of the total Gross Revenue is estimated to be 3.4%, 3.3% and 3.2% for Forecast Period 2007, Projection Year 2008 and Projection Year 2009, respectively. (II) Property Operating Expenses

Property operating expenses consist of (a) land rental, (b) property management fees and (c) other property operating expenses. (a) Land rental Land rental is required to be paid for three of the seven Retail Malls, namely Bandung Indah Plaza, Cibubur Junction and The Plaza Semanggi. The forecast and projected land rentals are based on the BOT Agreement. For the Retail Spaces, no land rentals are payable. (b) Property management fee

The property management fee for the Retail Malls is based on 2.0% per annum of the gross revenue for the relevant Retail Mall, plus a fee of 2.0% per annum of the net property income (calculated after accounting for the fee of 2.0% per annum of gross revenue for the relevant Retail Mall), and a fee of 0.5% per annum of the net property income in lieu of leasing commissions otherwise payable to the Property Manager and/or third party agents for each Retail Mall. For Retail Spaces, no property management fee is payable. (c) Other property operating expenses

The other property operating expenses comprise mainly fees for corporate secretariat services, annual tax returns filing services, and accounting and auditing services. The Manager has assumed no growth in the annual operating expenses for Forecast Period 2007, Projection Year 2008 and Projection Year 2009.
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Profit forecast and profit projection (III) Depreciation

Depreciation expenses at the Indonesian SPCs consist of depreciation of property, plant, equipment, including capitalised acquisition related expenses. Properties are depreciated on a straight-line basis over useful life. (IV) Interest income

Financial income comprises mainly interest income earned from interest bearing bank balances. The Manager has calculated the interest earned based on the estimated monthly net cash inflow and has assumed such cash to earn interest at an interest rate of 2.0% per annum calculated on a monthly basis. The Manager has assumed that the interest income earned will be subjected to Indonesian withholding tax of 20.0% and that the cash will be kept in Rupiah and Singapore dollars. (V) Financial Expenses LMIR Trust will not incur any borrowings at Listing Date. Financial expenses comprise the notional interest expense in relation to the FRS adjustment on rental deposit. (VI) Administrative Expenses

(a) Managers management fees Under the Trust Deed, the Managers Base Fee is 0.25% per annum of the value of the Deposited Property and a Performance Fee of 4.0% per annum of the NPI of LMIR Trust for each financial year. Both components are payable quarterly in arrears pursuant to the Trust Deed. (See The Manager and Corporate GovernanceManagement Fees.) The Manager may elect to receive the management fees in cash or units or a combination of cash and units (as it may in its sole discretion decide). For Forecast Period 2007, Projection Year 2008 and Projection Year 2009, the Manager has assumed that 100.0% of the Performance Fee will be paid in the form of Units and will be issued at the Offering Price. (b) Trustees fee

Under the Trust Deed, the Trustees fee is up to 0.03% per annum of the value of the Deposited Property, subject to a minimum amount of S$15,000 per month, and is accrued daily and paid monthly. It is calculated based on the forecast and projected Deposited Property at the end of each month in accordance with the Trust Deed. In addition, a one-time inception fee of S$25,000 is payable. (c) Other expenses

Other expenses include recurring operating expenses such as annual listing fees, valuation fees, legal fees, registry and depository charges, accounting, audit and tax advisers fees, postage, printing and stationery costs, costs associated with the preparation of annual reports, investor communications costs and other miscellaneous expenses. The Manager has assumed no growth in the annual operating expenses for Forecast Period 2007, Projection Year 2008 and Projection Year 2009. (VII) Repayment of Shareholders Loan

Based on Indonesian accounting standards, depreciation of real estate is a mandatory expense of the Indonesian SPCs when determining the net profits from operations of an Indonesian SPC that would be available for payment as dividends. This effectively traps cash in the Indonesian SPCs as depreciation is not a cash expense. However, the Properties are treated as real properties carried at valuation under FRS and hence are not depreciated. Accordingly, such depreciation of real properties is not treated as an expense item when computing Distributable Income of LMIR Trust. To distribute this portion, there is a need to extract the cash that is trapped in the Indonesian SPCs mainly in the form of depreciation expense. Hence a principal
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Profit forecast and profit projection repayment of the shareholders loans by the Indonesian SPCs is made every quarter and this repayment sum is equal to the lower of: Depreciation expense for the period; and Profit after taxes and before depreciation. (VIII) Interest on Shareholders Loan The Manager has assumed that the interest rates on the shareholders loans extended by Singapore SPCs to the Indonesian SPCs will be 14.0% per year. It is assumed the Indonesian SPCs will withhold 10.0% tax on the interest expense and the interest earned by the Singapore SPCs will not be subject to tax. (IX) Distributable Income Distributable Income comprises: (a) Distribution from operations Distribution from operations includes dividend income, after deduction of applicable expenses, received from the Target Singapore SPCs. The income of the Target Singapore SPCs is derived mainly from interest income earned and dividends from the Indonesian SPCs. The Manager has assumed that LMIR Trust will receive the dividend income from the Target Singapore SPCs in the same distribution period to which the underlying Indonesian profits out of which the dividends are paid relate. (b) Return on capital

Return on capital comprises the amounts received by LMIR Trust from the redemption of its investment in the redeemable preference shares in the Target Singapore SPCs. 100.0% of the tax-exempt income (after deduction of applicable expenses) and capital receipts will be distributed to Unitholders for Forecast Period 2007, Projection Year 2008 and Projection Year 2009, either in the form of distribution from operations or return on capital. Thereafter, the Manager will distribute at least 90.0% of Distributable Income. (X) Capital Expenditure An allowance for expected capital expenditure on the Retail Malls has been included in Forecast Period 2007, Projection Year 2008 and Projection Year 2009 and it is assumed that the capital expenditure will be funded from internal cash flows. Capital expenditure incurred are capitalised as part of the Deposited Property and has no impact on distribution other than the Managers Base Fee and Trustees fee. The Manager has assumed that the following capital expenditure will be incurred:
Forecast Period 2007 (S$000) Projection Year 2008 (S$000) Projection Year 2009 (S$000)

Capital Expenditure . . . . . . . . . . . . . . . . . . . . . . . . . . .

456

987

814

The Manager has assumed that no capital expenditure will be incurred for the Retail Spaces for Forecast Period 2007, Projection Year 2008 and Projection Year 2009 (see Certain Agreements Relating to LMIR Trust and the PropertiesDescription of the Master Lease Agreements). (XI) Investment Properties The Manager has assumed that the value of the Properties will only increase by the amount of forecast and projected capital expenditure described in Capital Expenditure above for the Forecast Period 2007, the Projection Year 2008 and the Projection Year 2009.
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Profit forecast and profit projection (XII) Taxes

The Manager has assumed no significant changes in the taxation regulations in Singapore and Indonesia and others that will have material impact to the Distributable Income in Forecast Period 2007, Projection Year 2008 and Projection Year 2009 (see Taxation). (XIII) Accounting Standards and Policies The Manager has assumed that there will be no change in applicable accounting standards or other financial reporting requirements that may have a material effect on the total return for Forecast Period 2007, Projection Year 2008 and Projection Year 2009. Significant accounting policies adopted by the Manager in the preparation of Forecast Period 2007, Projection Year 2008 and the Projection Year 2009 are set out in Appendix BIndependent Accountants Report on the Unaudited Pro Forma Consolidated Balance Sheet as at the Listing Date. (XIV) Forward Exchange Rates

The Trustee, as trustee of LMIR Trust, has entered into a currency hedging arrangement, effective as of the Listing Date, to hedge the movements in exchange rates (whether favourable or unfavorable) for a period of five years from the Listing Date for the notional amount of the expected Indonesian Rupiah cash flow arising from: (i) dividends received or receivable from the Singapore SPCs. The income of the Singapore SPCs is derived mainly from interest income earned and dividends from the Indonesian SPCs; and

(ii) capital receipts from the redemption of redeemable preference shares in the Target Singapore SPCs. The redemption of the shares is in turn funded from the repayments of the Indonesian Rupiah shareholders loans. An affiliate of the Sponsor has guaranteed, on a non-recourse basis to LMIR Trust, all of LMIR Trusts liabilities and obligations under such hedging arrangement until the Listing Date. The notional amount of the expected Indonesian Rupiah cash flow will be hedged at the following forward exchange rates between Singapore Dollars and Indonesian Rupiah until the end of Projection Year 2009:
Forward exchange rate (Indonesian Rupiah per S$1.00)

Period for which Indonesian Rupiah cash flow is hedged

Payment Date

Listing Date to 1 January 2008 to 31 March 2008 1 April 2008 to 30 June 2008 1 July 2008 to 30 September 2008 1 October 2008 to 31 December 2008 1 January 2009 to 31 March 2009 1 April 2009 to 30 June 2009 1 July 2009 to 30 September 2009 1 October 2009 to 31 December 2009

15 15 15 15 15 15 15 15

May 2008 August 2008 November 2008 February 2009 May 2009 August 2009 November 2009 February 2010

6,417 6,534 6,647 6,750 6,846 6,948 7,055 7,169

The Manager has assumed that the currency hedging arrangements do not meet the hedge accounting requirements as stipulated in FRS 39Financial Instruments: Recognition and Measurement. Consequently, any gain or loss from fair value measurement of the hedging instrument shall be recognised in the Consolidated Statement of Total Return. (XV) Other Assumptions The following additional assumptions have been made in preparing the Profit Forecast and Profit Projection: There will be no material changes in applicable legislation. The tax exemption and tax ruling remain valid.
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Profit forecast and profit projection All leases and licences are enforceable and will be performed in accordance with their terms. The property portfolio remains unchanged throughout Forecast Period 2007, Projection Year 2008 and Projection Year 2009. 100.0% of the Distributable Income will be distributed over Forecast Period 2007, Projection Year 2008 and Projection Year 2009; and at least 90% of the Distributable Income will be distributed thereafter. There will be no changes in the fair value of all financial instruments throughout Forecast Period 2007, Projection Year 2008 and Projection Year 2009. There will be no further capital raised during Forecast Period 2007, Projection Year 2008 and Projection Year 2009. Operating Companies will perform their duties and fulfil their obligations as required. (See Certain Agreements Relating to LMIR Trust and the PropertiesDescription of the Operating Costs Agreements and Certain Agreements Relating to LMIR Trust and the PropertiesDescription of the Rental Guarantee Deeds.) SENSITIVITY ANALYSIS The forecast and projected distributions included in this Prospectus are based on a number of assumptions that have been outlined above. The forecast and projected distributions are also subject to a number of risks as outlined in Risk Factors. All prospective investors in the Units should be aware that future events cannot be predicted with any certainty and deviation from the figures forecast or projected in this Prospectus are to be expected. To assist investors in assessing the impact of these assumptions on the Profit Forecast and Profit Projection, a series of tables demonstrating the sensitivity of the distribution per Unit to changes in the key assumptions are set out below. The sensitivity analysis is intended to provide a guide only and variations and actual performance could exceed the ranges as shown. Movements in other variables may offset or compound the effect of a change in any variable beyond the extent shown. Rental growth rate Changes in rental growth rate impact the Gross Rent of each Indonesian SPC. The base case rental growth rate of each Property is set out earlier in this section. The impact of variations in the yield is set out below.
Yield Forecast Period 2007 Based on Offering Price (%) Projection Year 2008 Based on Offering Price (%) Projection Year 2009 Based on Offering Price (%)

Rental growth rate

5% lower. . . . . . . . . . . . . . . . . . . . . . . . . Base Case . . . . . . . . . . . . . . . . . . . . . . 5% higher . . . . . . . . . . . . . . . . . . . . . . . .

6.85 6.85 6.85

7.29 7.30 7.30

7.81 7.84 7.85

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Profit forecast and profit projection Vacancy allowance Changes in vacancy allowance impact the Gross Rent of each Indonesian SPC. The base case vacancy allowance of each Property is set out earlier in this section. The impact of variations in the yield is set out below.
Yield Forecast Period 2007 Based on Offering Price (%) Projection Year 2008 Based on Offering Price (%) Projection Year 2009 Based on Offering Price (%)

Vacancy allowance

1 month . . . . . . . . . . . . . . . . . . . . . . . . . Base Case . . . . . . . . . . . . . . . . . . . . . . 3 months . . . . . . . . . . . . . . . . . . . . . . . . Operating Cost Subsidy

6.85 6.85 6.85

7.30 7.30 7.30

7.85 7.84 7.83

Pursuant to each of the Operating Costs Agreements to be entered into between the relevant Retail Mall Indonesian SPC and Operating Company, the relevant Operating Company will agree to unconditionally bear, for a period of three years commencing from 1 January 2007, all costs directly related to the maintenance and operation of the relevant Retail Mall. Assuming that there is no subsidy from the Operating Company to each Indonesian SPC, the impact of variations in the yield is set out below.
Yield Forecast Period 2007 Based on Offering Price (%) Projection Year 2008 Based on Offering Price (%) Projection Year 2009 Based on Offering Price (%)

Subsidy

No subsidy . . . . . . . . . . . . . . . . . . . . . . . Base Case . . . . . . . . . . . . . . . . . . . . . . Rental guarantee

6.70 6.85

7.20 7.30

7.91 7.84

Under the Rental Guarantee Deeds, Lippo Strategic will provide rental guarantees to the relevant Retail Mall Singapore SPCs in respect of existing and new units in the respective Retail Malls which are untenanted. (See Certain Agreements Relating to LMIR Trust and the PropertiesDescription of Rental Guarantee Deeds.) The Rental Guarantee Deeds cover the period commencing from the Listing Date up to 31 December 2009. Pursuant to the Rental Guarantee Deeds, Lippo Strategic is obliged to pay to the Retail Mall Singapore SPCs a specified sum in respect of each Retail Mall for every year during the said period. The first of such payments will be paid on or before 31 January 2008, and subsequent payments will be made on a quarterly basis thereafter. In the event any of the specified units in the relevant Retail Mall becomes tenanted during such period, the amount of the specified sum payable by Lippo Strategic in respect of such Retail Mall will be reduced by the amount of the rental payable under the relevant tenancy, regardless of whether such rental is received by the owner of the relevant Retail Mall and notwithstanding that such tenancy may be or is terminated prior to the expiry of such period. Assuming that there is no rental guarantee from Lippo Strategic to the relevant Retail Mall Singapore SPCs, the impact of variations in the yield is set out below.

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Profit forecast and profit projection

Yield Forecast Period 2007 Based on Offering Price (%) Projection Year 2008 Based on Offering Price (%) Projection Year 2009 Based on Offering Price (%)

Rental guarantee

No rental guarantee . . . . . . . . . . . . . . . . Base Case . . . . . . . . . . . . . . . . . . . . . . Capital expenditure on the Retail Spaces

6.48 6.85

6.55 7.30

6.89 7.84

Under each of the Master Lease Agreements, the Master Lessee shall be responsible for the maintenance of the Retail Space in question and all fixtures, fittings and installations therein, including keeping the same clean and in good and tenantable condition, undertaking works to make good any damage, maintaining the mechanical and electrical equipment in accordance with the relevant manufacturers guidelines and maintenance of its own plant and machinery which are required for the operation of its business. The Master Lessee shall also be responsible for the land and building tax (including any increases) in respect of the Retail Spaces. The Master Lessee must comply, at its cost and expense, with all laws and regulations and all requirements of the relevant authorities in force at the moment relating to the Retail Spaces. During the first 30 months of the lease term, the Master Lessee shall at its own cost and expense carry out all repair and replacement works in respect of the mechanical and electrical equipment, whether or not such works are of a capital nature. After the first 30 months of the lease term, the relevant landlords will be responsible for repair and replacement works in relation to the mechanical and electrical equipment which are of a capital nature. Where any replacement works (after the first 30 months of the lease term) is reasonably required by the Master Lessee in connection with any changes to the layout of the Retail Spaces, the cost of such replacement works shall be deducted from the rent payable by the Master Lessee to the relevant landlord for the rest of the lease term. The Manager has assumed that no capital expenditure will be incurred for the Retail Spaces for Forecast Period 2007 and Projection Year 2008 and Projection Year 2009 (see Certain Agreements Relating to LMIR Trust and the PropertiesDescription of the Master Lease Agreements). Assuming that there is capital expenditure on the Retail Spaces, the impact of variations in the yield is set out below.
Yield Forecast Period 2007 Based on Offering Price (%) Projection Year 2008 Based on Offering Price (%) Projection Year 2009 Based on Offering Price (%)

Capital expenditure

Borne by LMIR Trust. . . . . . . . . . . . . . . . Base Case . . . . . . . . . . . . . . . . . . . . . . . Retail Malls held via BOT Schemes

6.85 6.85

7.30 7.30

7.84 7.84

The relevant Retail Mall Indonesian SPCs will own five of the seven Retail Malls, namely, Cibubur Junction, The Plaza Semanggi, Ekalokasari Plaza, Bandung Indah Plaza and Istana Plaza, via BOT Schemes. In the case of Bandung Indah Plaza, the relevant BOT Grantor has granted the BOT Grantee, the owner of Bandung Indah Plaza, the right to apply for HGB titles on top of its HPL titles. Ownership of the HGB title allows the BOT Grantee to encumber the land with prior consent of the BOT Grantor and subject to the BOT Agreement. (See Overview of Relevant Laws and Regulations in IndonesiaRights to Own and/or to Use.) In the case of the remaining four Retail Malls (i.e. Cibubur Junction, The Plaza Semanggi, Ekalokasari Plaza and Istana Plaza), the BOT Grantee cannot transfer or encumber the land on which the relevant Retail Mall is situated.
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Profit forecast and profit projection The impact of variations in the yield is set out below:
Yield Forecast Period 2007 Based on Offering Price (%) Projection Year 2008 Based on Offering Price (%) Projection Year 2009 Based on Offering Price (%)

Base case . . . . . . . . . . . . . . . . . . . . . . . Excluding the four Retail Malls held via BOT Schemes. . . . . . . . . . . . . . . . . . .

6.85 3.05

7.30 3.30

7.84 3.63

The base case is for LMIR Trusts initial property portfolio to include the four Retail Malls held via BOT Schemes. Payment of Management Fee Assuming that the payment of the Managers management fee is entirely in the form of Units (base fee and performance fee) or entirely in cash (base fee and performance fee), the impact of variations in the yield is set out below:
Yield Forecast Period 2007 Based on Offering Price (%) Projection Year 2008 Based on Offering Price (%) Projection Year 2009 Based on Offering Price (%)

In Units. . . . . . . . . . . . . . . . . . . . . . . . . . Base case . . . . . . . . . . . . . . . . . . . . . . . In cash . . . . . . . . . . . . . . . . . . . . . . . . . .

7.18 6.85 6.50

7.61 7.30 6.94

8.13 7.84 7.48

The base case for the payment of management fees are 100% in cash for the base fee and 100% in form of Units for the performance fee. Distribution Policy Assuming that the distribution policy of LMIR Trust is to distribute 90.0% of its tax exempt-income and capital receipts, the impact of variations in the yield is set out below.
Yield Forecast Period 2007 Based on Offering Price (%) Projection Year 2008 Based on Offering Price (%) Projection Year 2009 Based on Offering Price (%)

Base case . . . . . . . . . . . . . . . . . . . . . . . Distribute 90.0% of LMIR Trusts tax exempt-income and capital receipts. . .

6.85 6.15

7.30 6.56

7.84 7.05

The base case for LMIR Trusts distribution policy is to distribute 100.0% of its tax exempt-income and capital receipts.

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Strategy
The principal investment strategy of the Manager is owning and investing on a long-term basis in a diversified portfolio of income-producing real estate in Indonesia that are primarily used for retail and/or retail-related purposes, and real estate related assets in connection with the foregoing purposes. In accordance with the requirements of the Listing Manual, the Managers investment strategy for LMIR Trust will be adhered to for at least three years following the Listing Date, unless otherwise agreed by an Extraordinary Resolution passed at a meeting of Unitholders duly convened and held in accordance with the provisions of the Trust Deed. The Managers key objectives are to deliver regular and stable distributions to Unitholders and to achieve long-term growth in the NAV per Unit in order to provide Unitholders with capital appreciation on their investments. The Manager plans to achieve these objectives through the following strategies: ACQUISITION GROWTH STRATEGY LMIR Trusts acquisition growth strategy envisages investments in retail and/or retail-related assets that are in the interests of Unitholders. The assets in LMIR Trusts initial portfolio are all located in Indonesia. ACTIVE ASSET ENHANCEMENT AND MANAGEMENT STRATEGY Implementing pro-active measures to enhance the returns from the existing and future properties in LMIR Trusts portfolio. Such measures may include addition and alteration works, including re-zoning, tenancy remixing and work carried out for the purpose of expanding size and capacity and (in relation to properties to be acquired by LMIR Trust), leveraging and enhancing the properties competitive strengths to optimise rentals and enhancement projects to maintain the competitive positioning of such properties. The Manager intends to work with the relevant Indonesian authorities to gain the necessary approvals to undertake such active asset enhancement works. As at the Latest Practicable Date, three of the Retail Malls, Bandung Indah Plaza, Mal Lippo Cikarang and Ekalokasari Plaza have recently completed extensive asset enhancement works and a fourth Retail Mall, The Plaza Semanggi is currently undergoing asset enhancement works. - Bandung Indah Plaza has recently completed enhancement and renewal works which created an additional NLA of approximately 3,843 sq m. - Mal Lippo Cikarang has recently completed the building of an extension which has increased the NLA of the malls hypermarket and specialty space by 10,694 sq m. As at 30 June 2007, 8,539 sq m or approximately 79.8% of the additional NLA created from such asset enhancement has been precommitted to Hypermart, one of Indonesias leading hypermarket chains. - Ekalokasari Plaza has recently completed asset enhancement works which created an additional NLA of 5,013 sq m by adding a third floor and a mezzanine floor. This development incorporates a food court, a proposed fitness centre and potentially a cinema as anchor tenants for the top levels of the centre. These asset enhancement works are expected to improve shopper traffic throughout all levels of the mall. As at 30 June 2007, 670 sq m or approximately 13.4% of the additional NLA created from such asset enhancement has been pre-committed. - The Plaza Semanggi is undergoing asset enhancement works to include a new alfresco caf area called the Plangi on the Sky caf, which will increase NLA by approximately 3,000 sq m by the end of 2007. Each of Bandung Indah Plaza, Mal Lippo Cikarang and Ekalokasari Plaza has either obtained, or is in the process of obtaining, final local government approval for the recently completed asset enhancement works which have created additional NLA. CAPITAL AND RISK MANAGEMENT STRATEGY By the Listing Date, LMIR Trust expects to put in place the Debt Facilities, being a floating rate secured term loan facility of up to S$350.0 million. While LMIR Trust will not incur any borrowings as at the Listing
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Strategy Date, to the extent that LMIR Trust incurs borrowings in the future, the Manager will employ an appropriate mix of debt and equity in the financing of future acquisitions. The Trustee, as trustee of LMIR Trust, will enter into currency hedging arrangements to optimise risk-adjusted returns to the Unitholders as at Listing Date. Acquisition growth strategy The Manager will pursue opportunities for asset acquisitions that will provide attractive cash flows and yields relative to LMIR Trusts weighted average cost of capital, and opportunities for future income and capital growth. In evaluating future acquisition opportunities, the Manager will seek acquisitions that may enhance the diversification of the portfolio by geography and tenant profile, and optimise risk-adjusted returns to the Unitholders. The Manager believes it is well qualified to pursue its acquisition strategy. The management of the Manager has extensive experience and a strong track record in sourcing, acquiring and financing retail and/or retail-related real estate assets locally in Indonesia. The managements industry knowledge, relationships and access to market information provide a competitive advantage with respect to identifying, evaluating and acquiring retail and/or retail-related real estate assets. The Managers acquisition growth strategy will be underpinned by: LMIR Trusts relationship with the Sponsor LMIR Trust intends to leverage on the Sponsors experience, market reach and network of contacts for its acquisition strategy to evaluate and execute appropriate acquisitions that are in the interests of Unitholders and provide potential for income and capital growth. The Sponsor intends to support the growth of LMIR Trusts portfolio in the following ways: allow the Manager to leverage the Sponsors established network of relationships to pursue the growth strategy of LMIR Trust; lend its extensive experience and expertise in the retail and property industry to the Manager to assess potential acquisition opportunities; and subject to certain conditions, as stipulated in the Right of First Refusal Agreement, facilitate a pipeline of acquisitions via the ROFR granted by the Sponsor to LMIR Trust over the ROFR Properties (see Certain Agreements Relating to LMIR Trust and the PropertiesDescription of the Right of First Refusal Agreement). LMIR Trusts relationship with the Mapletree Group The Manager is 40.0% owned by Mapletree Capital and 60.0% owned by Peninsula Investment Ltd. Peninsula Investment Ltd is in turn 100.0% owned by Jesselton Investment Ltd, a wholly-owned subsidiary of the Sponsor. Mapletree Capital is a wholly-owned subsidiary of MIPL and is part of the Mapletree Group. MIPL is a leading Asia-focused real estate company based in Singapore. It has an asset base of about S$4.5 billion (as at 30 June 2007) comprising office, logistics, industrial and retail/lifestyle properties. Its business philosophy is to shape new ways of delivering value from real estate and real estate-related investments to its stakeholders. It aims to be a strategic real estate partner providing real estate solutions, including capital management and quality property-related services and products to its investors, tenants, co-development partners and other business partners. To support its regional business, the group has established an extensive network and presence with ongoing activities in Singapore, China, Hong Kong, Japan, Malaysia and Vietnam. One of the ways that MIPL unlocks value is by developing and rejuvenating large scale mixed-used developments such as the approximately 24-ha HarbourFront Precinct, the centrepiece of which is VivoCity, the largest retail and lifestyle destination in Singapore. MIPL is the sponsor of MapletreeLog, the first Asia-focused logistics real estate investment trust in Singapore. MapletreeLog was listed on the SGX-STon 28 July 2005. It has a principal strategy of investing in a diversified portfolio of income-producing logistics real estate and real estate-related assets across the Asian region. Since its listing, MapletreeLog has grown its portfolio size from the initial 15 logistics assets in Singapore valued at S$422.0 million to 58 logistics assets in Singapore, Hong Kong, China, Malaysia and Japan, valued at about S$2.1 billion as at 30 June 2007. MIPLs success with MapletreeLog has
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Strategy demonstrated its clear ability to identify and structure a pan-Asian REIT, building a regional portfolio of good quality logistics assets and supporting the growth of the REIT through a yield plus growth strategy. As sponsor of MapletreeLog, MIPL is also committed to support the growth of the trust by forging strategic alliances and undertaking development projects to build a strong pipeline of logistics properties for MapletreeLog to purchase on a right of first refusal basis. These development projects include logistics parks, built-to-suit and ready-built logistics facilities in Singapore, Malaysia as well as in new markets such as China and Vietnam, to cater to the needs of MapletreeLogs customers. In addition to the publicly listed MapletreeLog, MIPL also manages a number of private real estate funds, such as: Mapletree Industrial Fund (MIF); CIMB-Mapletree Real Estate Fund 1; and Mapletree Real Estate Mezzanine Fund 1. It has the experience, and the necessary real estate and financing skills to structure, originate and manage real estate-related financial products that cater to different pools of investors with different risk appetites. The following provides a brief summary of the private real estate funds managed by MIPL: Mapletree Industrial Fund Mapletree sponsored the establishment of MIF with the objective of investing in industrial properties in Asia. It secured Bahrain-based Ahli United Banks (AUB) Pan Asian Industrial Fund as a cornerstone investor for its first closing of US$310 million in November 2006. AUBs Pan Asian Industrial Fund had committed an investment amount of US$185 million to the MIF, while Mapletrees commitment was US$125 million. MIF is a seven-year private fund which aims to provide stable recurrent income and strong total returns to investors. It is managed by Mapletree Industrial Fund Management Pte. Ltd. (MIFM), a whollyowned subsidiary of Mapletree Capital. MIFs target investments are primarily manufacturing facilities, business parks, industrial parks, research and development facilities, information technology and software parks and industrial offices. The intent is to tap the shift in production and research and development processes to Asia by creating a diversified portfolio of good quality industrial real estate assets with stable returns. CIMB-Mapletree Real Estate Fund 1 Mapletree jointly manages CIMB-Mapletree Real Estate Fund 1 (CMREF 1), a Malaysia focused real estate fund, through a joint venture with Malaysias CIMB. CIMB-Mapletree Real Estate Funds committed capital has almost been fully earmarked for committed projects. With a mandate to make direct investments in properties in Malaysia, including investments in distressed assets, real estate investment products and listed real estate securities, CMREF 1 has committed capital of MYR 402 million. With a target gearing ratio of 3:1, the total asset size could potentially be about MYR 1.6 billion. As at 31 March 2007, total committed investments was about MYR 700 million. It has acquired office buildings and a shopping mall in Kuala Lumpur, and formed a joint venture with a listed Malaysia developer, E&O Property Development, and Al Salam Bank Bahrain to develop bungalow lots in Penang. CMREF 1 has also underwritten certain units in a landed residential development in Kuala Lumpur and invested in real estate investment trusts in Malaysia and the region. Mapletree Real Estate Mezzanine Fund 1 As at 31 March 2007, Mapletree Real Estate Mezzanine Fund 1 (MREM 1), an Asia-wide real estate fund that focuses on originating and executing real estate mezzanine loans, had completed and divested three mezzanine investments aggregating S$51 million. The aggregated realised internal rate of returns for all the investments well surpassed the targeted internal rate of returns of MREM 1.
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Strategy Given that there is limited potential to scale up MREM 1, the Group is in the process of closing the fund in order to focus on our other real estate funds. MIPL is a wholly-owned subsidiary of Temasek Holdings (Private) Limited. LMIR Trust will benefit from the track record of the Mapletree Group, with its experience in acquiring yieldaccretive assets in various markets, including via the management of MapletreeLog and other private real estate funds in Asia. The Mapletree Groups total assets under management as at 31 March 2007 was S$1.7 billion. Key opportunities arising from trends in the retail industry The Manager believes that retail service providers are increasingly looking to free up capital for business expansion which may increase the availability of assets for acquisition. In addition, LMIR Trust can seek partnership and co-operation opportunities with the Sponsor. In evaluating asset acquisition opportunities, the Manager will focus on the following criteria: Impact on income distributions. The Manager will seek to acquire retail and retail-related real estate assets that provide returns above LMIR Trusts cost of capital, and are thereby expected to maintain or enhance LMIR Trusts distributions per Unit as well as provide future long-term growth prospects which are consistent with LMIR Trusts pre-acquisition portfolio; Opportunities for creating value. The Manager will seek retail and retail-related real estate assets that provide opportunities for creating value such as retail malls or retail spaces which have been undermanaged or under-capitalised, or which offer expansion or enhancement opportunities; Location. The Manager will seek to acquire retail and retail-related real estate assets in markets with high growth potential. Within these markets, the Manager will seek to acquire assets in strategic or prime locations; Geographical diversification. The Manager will seek to acquire properties that improve the geographical diversification of LMIR Trusts portfolio; Management quality. The Manager will consider the quality and experience of management and the creditworthiness of the operator of the retail and/or retail-related property; Financial soundness. The Manager will consider the retail and/or and retail-related real estate assets historical and forecasted cash flows, its ability to meet operational needs, its capital expenditure requirements, its lease or debt service obligations as well as its ability to provide a competitive return on investment to LMIR Trust; Regulatory and tax implication. The Manager will consider the tax growth and regulatory environment of the jurisdiction in which the retail and/or and retail-related real estate asset is located; Operational profile. The Manager will consider the occupancy of and demand for similar retail and/or retail-related real estate assets in the same or nearby communities; Building and facility specifications. The Manager will examine building and facility specifications such as construction quality, condition and design, as well as the size and age of the buildings. The potential to add value through selective renovation or other enhancements will be assessed; and Engineering, environmental and land survey reports. The Manager will rely on reports submitted by a range of experts that cover matters such as (i) building deterioration; (ii) maintenance, repairs and capital expenditure requirements; (iii) environmental matters; and (iv) compliance with building regulations. These reports will be used to assess building conditions and expected levels of capital expenditure in the short- to medium-term. The Manager intends to hold the properties it acquires on a long-term basis. However, in the future, where the Manager considers that any property has reached a stage that offers limited scope for further growth, the Manager may consider selling the property and using the proceeds for alternative investments in properties that meet its investment criteria.
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Strategy Active asset enhancement and management strategy The Manager intends to implement pro-active measures, subject to approval by the relevant Indonesian authorities, to enhance the returns from the existing and future properties in LMIR Trusts portfolio. Such measures include: addition and alteration works, including work carried out for the purpose of expanding size and capacity and mall layout efficiency; leveraging and enhancing the properties competitive strengths to optimise rentals and enhancement projects to maintain the competitive positioning of such properties; promoting a niche position for the properties in LMIR Trusts portfolio / raising the profile of the properties in LMIR Trusts portfolio through retail marketing strategies, mall positioning and branding; and in relation to properties to be acquired by LMIR Trust, obtaining contractual rent escalations under longterm leases, backed by security deposits consisting of irrevocable letters of credit or cash, most of which will cover at least six months of initial monthly minimum rents. Additional security will be provided typically by covenants regarding minimum working capital and net worth, liens on accounts receivable and other operating assets, and various provisions for cross-default, cross-collateralisation, when appropriate. Capital and risk management strategy While LMIR Trust will not be drawing down on the Debt Facilities as at the Listing Date, in the event that LMIR Trust incurs any future borrowings, the proposed objectives of the Manager in relation to capital and risk management will be to: maintain a strong balance sheet by adopting and maintaining a target gearing ratio; secure diversified funding sources from financial institutions and capital markets as LMIR Trust continually assesses expansion and acquisition opportunities; adopt a proactive strategy to manage risks related to interest rate fluctuations; and manage foreign exchange exposure through hedging, where appropriate. By doing so, the Manager believes that LMIR Trust will optimise Unitholders returns while maintaining operating flexibility when considering capital expenditure requirements. The Manager will, in the event that LMIR Trust incurs any future borrowings, periodically review LMIR Trusts capital management policy with respect to its Aggregate Leverage and modify the policy as its management deems prudent in light of prevailing market conditions. If LMIR Trust takes on debt, the Managers strategy will generally be to match the maturity of LMIR Trusts indebtedness with the maturity of LMIR Trusts investment assets, and to employ long-term, fixed-rate debt to the extent practicable in view of market conditions in existence from time to time. The key aspects of the proposed capital and risk management strategy are as follows: To maintain an Aggregate Leverage within permitted limits The Manager will aim to maintain the Aggregate Leverage of LMIR Trust comfortably within borrowing limits allowable under the Property Funds Guidelines. Furthermore, by achieving the right ratio of debt and equity, the Manager will be able to minimise LMIR Trusts cost of capital and maximise returns to Unitholders. To secure diversified funding sources from financial institutions and capital markets as LMIR Trust continually assesses expansion and acquisition opportunities In order to finance acquisitions and refurbishment of properties, in addition to any bank borrowings, the Manager will consider accessing the debt capital markets through the issuance of bonds and/or notes to diversify its sources of funding. The debt market provides LMIR Trust with the ability to secure longer
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Strategy term funding in a more cost-efficient manner. In addition to its debt strategy, the Manager will capitalise on opportunities to raise additional equity capital for LMIR Trust through the issue of additional Units. To adopt a proactive interest rate management strategy The Manager will adopt a proactive strategy to manage the risk associated with changes in interest rates on any future loan facilities while also seeking to ensure that LMIR Trusts ongoing cost of debt capital remains competitive. To manage the foreign exchange exposure through hedging, where appropriate For future acquisitions, in order to manage the currency risks associated with the capital values of overseas assets, the Manager will, to the extent possible, adopt a hedging strategy by borrowing in the same currency as the underlying asset.

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Business and properties

OVERVIEW LMIR Trust is a Singapore-based REIT constituted by the Trust Deed. It is established with the principal investment objective of owning and investing on a long-term basis in a diversified portfolio of incomeproducing real estate in Indonesia that are primarily used for retail and/or retail-related purposes, and real estate related assets in connection with the foregoing purposes. LMIR Trust seeks to produce regular and stable distributions to Unitholders and to achieve long-term growth in NAV per Unit through growth in rental yields and acquisitions which are in the interests of Unitholders. LMIR Trusts initial asset portfolio, as at the Listing Date, comprises the seven Retail Malls and seven Retail Spaces, all of which are located in Indonesia. The Properties will be the initial assets which LMIR Trust will invest in and own. Subsequently, the Manager aims to produce attractive total returns for Unitholders by, among other things: selective acquisition of properties that meet the Managers investment criteria; active asset enhancement and management of LMIR Trusts property portfolio to maximise returns; and employment of optimum capital structure and risk management. Competitive strengths The Manager believes that the competitive strengths of the Properties include: The Properties are located in major cities of Indonesia amidst a growing and affluent urban middle class. The Properties are mainly located within Greater Jakarta and Bandung, Indonesias fourth most populous city. Jakarta, Indonesias capital and largest city, has seen its total household expenditure increase by an average of 12.8% per annum from 2001 to 2006, rising from Rp. 19,277 billion in 2001 to Rp. 35,273 billion in 2006. Bandung has seen a similar growth in its total household expenditure, rising from Rp. 4,825 billion in 2001 to Rp. 8,317 billion in 2006, an average growth of 11.5% per annum from 2001 to 2006. Economic development in Indonesia has seen a significant growth of the middle class over the past five years. This middle income group is considered one of the vital contributors to the economy and is perceived as the most prospective target in mass consumer markets. Based on the Social Economic Survey (SES) by ACNielsen1 conducted in nine major cities in Indonesia, the share of population of the middle income group (classified as SES A, B & C) has steadily grown from 50.0% in 2001 to 64.0% in 2006. It is estimated that the urban middle income population in Indonesia totals approximately 66 million people. This particular group is likely to be considered a major target market for modern retail shopping centres. Retail spending in these cities has been further boosted by a shift in lifestyle towards a higher level of consumerism, partially brought about by the introduction of foreign brands and designer labels. These foreign brands and designer labels typically have higher margins and are willing to pay higher rentals for prime and sizeable retail space. The proliferation of hypermarkets and supermarkets over traditional markets has also increased shopper traffic to modern retail malls.
1

Source: ACNielsen Social Economic Survey. ACNielsen has not provided its consent, for the purposes of section 249 (read with section 302) of the SFA, to the inclusion of the information extracted from the relevant report issued by it, and is thereby not liable for such information under sections 253 and 254 (read with section 302) of the SFA. While the Manager has taken reasonable action to ensure that the information has been reproduced in its proper form and context, and that it has been extracted accurately and fairly, neither the Manager nor any other party has conducted an independent review of, nor verified the accuracy of, such information.

118

Business and properties In addition, the geographic diversification of the Properties reduces LMIR Trusts dependence on any single regional market and, accordingly, contributes to the stability of LMIR Trusts future income. (See Appendix FIndependent Report on the Indonesian Retail Property Market.) GRDP Per Capita by Indonesian City (Current Prices), 2003-2005*
60 50 40

2003 2004 2005

Rp Millions

30 20 10 0
Indonesia Jakarta Bandung Surabaya Semarang Medan

City
* Figures for Indonesia, Jakarta & Bandung are for 2003-2005 2005 figures for Surabaya, Semarang and Medan are not available

Source: Appendix FIndependent Report on the Indonesian Retail Property Market Socio-Economic Survey in Indonesia(1), 2001-2006
100% 90% 80% 70%
Monthly household expenditure A (Above Rp. 2 mil/month) B (Rp. 1.5-2 mil/month) C1 (Rp. 1.0-1.5 mil/month)

Percentage

60% 50% 40% 30% 20% 10% 0% 2001 2002 2003 2004 2005 2006

C2 (Rp. 0.7-1.5 mil/month) D (Rp. 0.5-0.7 mil/month) E (Below Rp. 0.5 mil/month)

Note: (1) AC Nielsen Socio-Economic Survey is based on monthly household expenditure, not actual income. No standard can be used (or widely accepted) to calculate direct relation between expenditure and income. Source: Appendix FIndependent Report on the Indonesian Retail Property Market

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Business and properties

Total household expenditure of the middle class (Rp. billions) Cities 2001 2006

Average annual growth 2001-2006 (%)

Jakarta . . . Bodetabek . Bandung . . Surabaya . . Semarang . Medan . . . .

. . . . . .

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. . . . . .

. . . . . .

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. . . . . .

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. . . . . .

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. . . . . .

. . . . . .

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. . . . . .

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. . . . . .

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. . . . . .

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. . . . . .

. . . . . .

. . . . . .

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. . . . . .

. . . . . .

. . . . . .

. . . . . .

10,561 7,493 2,793 4,295 1,758 3,542

17,276 25,817 4,304 6,293 3,691 5,103

10 28 9 8 16 8

Source: Appendix FIndependent Report on the Indonesian Retail Property Market High growth potential from favourable demographics of the Indonesia population According to the Independent Indonesian Retail Property Consultant, the Indonesia retail market has high growth potential, with 50.0% of Indonesias estimated population of 222 million in 2006 under the age of 25. Based on the Independent Report on the Indonesian Retail Property Market, the share of population of the middle income group has steadily grown from 50.0% in 2001 to 64.0% in 2006. It is estimated that the urban middle income population in Indonesia totals approximately 66 million people. (See Appendix FIndependent Report on the Indonesian Retail Property Market.) Retail Malls strategically located within well-established population catchment areas. The Retail Malls are strategically located throughout Greater Jakarta with a population range of between approximately 0.4 million and 2.2 million within their respective primary catchment areas. Located in middle to upper income demographic regions, each of the Retail Malls has a variety of strong characteristics such as: - Gajah Mada PlazaThe only shopping centre located in the Chinatown district of Jakarta with a hypermarket, executive club and a swimming pool; - Cibubur JunctionLocated in the heart of Cibubur, one of the most affluent and upmarket residential areas in Jakarta; - The Plaza SemanggiLocated in the golden triangle of the Jakarta CBD and accessible from all four directions of the capital city; - Mal Lippo CikarangGrowing residential and industrial Lippo township; - Ekalokasari PlazaA five-minute drive from the Bogor exit gate of the Jagorawi toll road, the highway which connects Jakarta to Bogor; - Bandung Indah PlazaStrategic location at the heart of Bandung and easily accessible to the greater Bandung population; and - Istana PlazaEasily accessible from several transportation hubs in the vicinity, such as the Husein Sastranegara Airport, Bandung train station and Pasteur tollgate. The Retail Malls located within Greater Jakarta, such as Gajah Mada Plaza and The Plaza Semanggi, also enjoy high levels of connectivity via public transportation such as the Transjakarta busway which is a premium form of public transportation in Jakarta, thereby enhancing the ability of these Retail Malls to draw high volumes of shoppers. Quality Retail Malls which cater to the daily needs of shoppers. The Retail Malls are strategically positioned as one-stop shopping destinations for shoppers and their families, catering to their daily as well as lifestyle and entertainment needs. The Retail Malls are anchored by supermarkets, hypermarkets or department stores, which draw significant shopper traffic to the malls and provide a comfortable, hassle-free and low-cost environment for shoppers to purchase
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Business and properties their daily necessities. The specialty, food & beverage and lifestyle and entertainment tenants, which include foreign labels and brands, restaurants, cinemas and entertainment centres provide shoppers with a wide product offering and a complete shopping experience, Further, the Retail Malls are managed by competent professionals with retail expertise and experience, as reflected in the high occupancy rates and the ability of each Retail Mall to differentiate itself from its competitors within its catchment area. As at 30 June 2007, the Retail Malls had a weighted average occupancy of approximately 91.6%, reflecting the robust demand for space in the Retail Malls. Retail Spaces strategically located within well-established population catchment areas. The Retail Spaces are strategically located throughout Greater Jakarta and in the major cities of Semarang, Medan, Madiun and Malang. For example, the Mall WTC Matahari Units are located in Serpong which is part of Tangerang, one of the settlement areas on the outskirts of Jakarta. Mall WTC Matahari is strategically located along a main road which connects to BSD City, the largest residential estate in Greater Jakarta. It has a proposed development area of 6,000 ha with currently 1,500 ha developed and is occupied by over 15,000 households. In recent years, BSD City has experienced rapid growth in terms of the number of housing units and retail shop houses which have been built. Another example is the Malang Town Square Units which are located in the city of Malang in the East Java province. Malang is the second largest city in East Java province with a population of approximately 0.8 million and a regency population of approximately 2.4 million people. The region is a popular tourist destination due to its natural attractions (for example, Mount Bromo, one of Javas largest volcanoes), cool climate and colonial history. Malang also has a large student population, being home to five universities (Brawijaya, State, Muhammadiyah, Widya Gama and Merdeka Universities). Economies of scale through portfolio management of the Retail Malls. The Property Manager, a wholly-owned subsidiary of the Sponsor, will manage the Retail Malls after the Listing Date. As the Retail Spaces are master-leased to Matahari, there is no property manager appointed for the Retail Spaces. The Property Manager believes that there are opportunities to realise efficiencies and economies of scale so as to maximise the performance of each Retail Mall. The Property Manager comprises a specialised team of professionals managing the key areas of operations, leasing, marketing and finance. Best practices are standardised and strictly adhered to across all assets under its portfolio. The Retail Malls will be able to leverage upon the Property Managers and the Sponsors experience in areas including contractor management, retailer relationships and key negotiations, cost control mechanisms and strategic leasing, marketing and management initiatives. Quality tenant base. The Retail Malls benefit from the quality of their tenants. The Retail Malls top tenants include wellknown international and domestic retailers and brand names such as Giant Hypermarket, Gramedia bookstore, Starbucks, Giordano, Fitness First, Sports Station, Matahari Department Store, Hypermart and Studio 21 Cinema. The Manager is of the view that the Retail Malls rental values are predominantly at or below market levels. This will allow the Manager to capture growth on lease expiries while maximising the retail mix of these malls. The Retail Malls have a large combined tenant base of over 1,400 tenants (as at 30 June 2007). These tenants represent a wide variety of mass retailers and specialty stores and provide trade and product diversification for the Retail Malls. Advance rental payment structure helps to minimise cash flow volatility due to potential rental arrears Retail tenants in Indonesia typically pay an advance rental of approximately 10% to 20% of the total rent payable for the duration of the lease upon signing of the lease agreement. This advance rental payment helps to minimise LMIR Trusts cash flow volatility due to potential rental arrears, thus enhancing LMIR Trusts cash flow stability.
121

Business and properties CERTAIN INFORMATION ON THE PROPERTIES

Percentage of contribution to LMIR Trusts gross rent for Forecast Period 2007 (%)

Name of property

Year of building completion

NLA as at 30 June 2007 (sq m)

GFA as at 30 June 2007 (sq m)

Occupancy as at 30 June 2007 (%)

Retail Malls Gajah Mada Plaza . . . . . . . . . Cibubur Junction . . . . . . . . . . The Plaza Semanggi . . . . . . . Mal Lippo Cikarang . . . . . . . . Ekalokasari Plaza. . . . . . . . . . Bandung Indah Plaza . . . . . . . Istana Plaza . . . . . . . . . . . . . .

. . . . . . .

1982 2005 2003 1995 2003 1990 2001

10.5 11.2 20.4 6.8 5.8 14.4 12.0 81.1

34,278 34,139 58,685(1) 17,974(2) 20,587(3) 26,472(4) 27,247 219,382

66,160 49,341 91,232 25,767 39,895 55,196 37,434 365,025

89.1 86.4 96.4 96.3 87.3 83.2 98.9 91.6(5)

Total for Retail Malls . . . . . . .

Notes: (1) Current ongoing asset enhancement works to include a new alfresco caf area called the Plangi on the Sky caf will increase NLA by an estimated 3,000 sq m, bringing total NLA to approximately 61,685 sq m by the end of 2007. (2) Recently completed asset enhancement works to expand the retail space at Mal Lippo Cikarang have increased the NLA by 10,694 sq m, bringing the total NLA to 28,668 sq m. (3) Recently completed asset enhancement works for the third floor and mezzanine have increased the NLA by 5,013 sq m, bringing the total NLA to 25,600 sq m. (4) Recently completed asset enhancement works have increased the NLA by 3,843 sq m, bringing the total NLA to 30,315 sq m. (5) Weighted average occupancy as at 30 June 2007.
Percentage of contribution to LMIR Trusts gross rent for Forecast Period 2007 (%)

Name of Property

Year of building completion

NLA as at 30 June 2007 (sq m)

Retail Spaces Mall WTC Matahari Units . . . . . . . . . . . . . . . . . . . . . . . . . . Metropolis Town Square Units . . . . . . . . . . . . . . . . . . . . . . . Depok Town Square Units . . . . . . . . . . . . . . . . . . . . . . . . . . Java Supermall Units . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Malang Town Square Units . . . . . . . . . . . . . . . . . . . . . . . . . Plaza Madiun . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Grand Palladium Medan Units . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . .

2003 2004 2005 2000 2005 2000 2005

2.5 3.3 2.5 2.4 2.4 3.1 2.6 18.9(3) 100.0

11,184(1) 15,248(2) 13,045(2) 11,082(1) 11,065(2) 19,029 13,417(2) 94,070 313,452

Total for Retail Spaces . . . . . . . . . . . . . . . . . . . . . . . . . . . . Total for Properties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Notes: (1) Based on Strata Titles Ownership Certificates. (See Information Regarding the Title of the Properties.) (2) Based on Kiosks Sale and Purchase Binding Agreements. (See Information Regarding the Title of the PropertiesThe Retail SpacesKiosks Sale and Purchase Binding Agreement.) (3) Due to rounding differences.
122

Business and properties Valuation Each of the Properties was valued as at 30 June 2007 by Knight Frank and Colliers. The Appraised Values of each of the Properties are set out in the following table:
Percentage of aggregate value of the Properties (as determined by Knight Frank) (%)

Property

Appraised value by Knight Frank as at 30 June 2007(1) (S$ million)

Appraised value by Colliers as at 30 June 2007(1) (S$ million)

Retail Malls Gajah Mada Plaza . . . . . . . . . . . . . . . . Cibubur Junction . . . . . . . . . . . . . . . . . The Plaza Semanggi . . . . . . . . . . . . . . Mal Lippo Cikarang . . . . . . . . . . . . . . . Ekalokasari Plaza. . . . . . . . . . . . . . . . . Bandung Indah Plaza . . . . . . . . . . . . . . Istana Plaza . . . . . . . . . . . . . . . . . . . . .

. . . . . . .

103.8 94.2 214.8 80.2 66.0 124.5 125.7 809.2 25.2 33.5 25.7 26.0 25.5 33.4 26.2 195.5 1,004.7

117.0 101.8 211.1 79.7 68.1 135.1 114.7 827.4(2) 24.3 32.2 24.8 25.0 25.8 31.8 25.2 188.9(2) 1,016.3

10.3 9.4 21.4 8.0 6.6 12.4 12.5 80.5(2) 2.5 3.3 2.6 2.6 2.5 3.3 2.6 19.5(2) 100.0

Sub-total . . . . . . . . . . . . . . . . . . . . . . . . Retail Spaces Mall WTC Matahari Units . . . . . . . . . . . . Metropolis Town Square Units . . . . . . . . Depok Town Square Units . . . . . . . . . . . Java Supermall Units . . . . . . . . . . . . . . . Malang Town Square Units. . . . . . . . . . . Plaza Madiun . . . . . . . . . . . . . . . . . . . . . Grand Palladium Medan Units . . . . . . . . Sub-total . . . . . . . . . . . . . . . . . . . . . . . . Grand Total . . . . . . . . . . . . . . . . . . . . . Notes:

(1) See Appendix EIndependent Property Valuation Summary Reports. (2) Due to rounding differences.

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Business and properties Tenant profile The table below sets out information on the 10 largest tenants of the Properties (in terms of Gross Rent based on Committed Leases as at 30 June 2007).(1)
Percentage of total Gross Rent based on Committed Leases as at 30 June 2007 (%)

Tenant

Trade sub-sector

Lease expiry date

Percentage of total NLA as at 30 June 2007 (%)

Matahari . . . . . . . . . . . . . Hypermart. . . . . . . . . . . . Rimo . . . . . . . . . . . . . . . . Centro . . . . . . . . . . . . . . . Giant . . . . . . . . . . . . . . . . Gramedia . . . . . . . . . . . . Electronic Solution Indonesia PT., . . . . . . . Fitness First . . . . . . . . . . Ace Hardware . . . . . . . . . Millennium Executive Club. . . . . . . . . . . . . . . Top 10 tenants . . . . . . . Other tenants . . . . . . . . Total . . . . . . . . . . . . . . . .

Department Store/ Supermarket Hypermarket Department Store Department Store Hypermarket Books & Stationery Electronics Sports & Fitness Houseware Leisure and Entertainment

23 March 2015 9 Dec 2026 2 May 2015 31 May 2015 30 June 2007(2) and 28 February 2012 4 November 2013 14 February 2019 30 November 2010 22 May 2014 31 14 17 28 October 2011 April 2021 and May 2020 February 2012

38.1 6.2 2.4 2.5 2.0 1.3

30.6 2.9 2.1 1.8 1.1 1.1

1.3 1.2 0.5 2.2 57.7 42.3 100.0

1.0 0.8 0.8 0.8 43.0 57.0 100.0

29 October 2014

Notes: (1) Includes the gross rental income from the Retail Spaces and assuming that the Master Lease Agreement was in effect as at 30 June 2007 (2) Rimos lease has been renewed till 30 June 2008. The following table sets out the expiry profile of the tenancies of the Retail Malls as at 30 June 2007:
Monthly gross rent of expiring leases as a percentage of forecast rental (%)

Period

Total number of expiring leases

NLA of expiring leases (sq m)

Expiring leases as a percentage of NLA as at 30 June 2007 (%)

2007 . . . . . . . 2008 . . . . . . . 2009 . . . . . . . Beyond 2009 . Vacant . . . . . .

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. . . . .

193 262 222 795 1,472

8,360 24,592 15,797 152,102 18,531 219,382

5.1 11.4 12.0 55.1 16.3 100.0(1)

3.8 11.2 7.2 69.3 8.4 100.0(1)

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Note: (1) Due to rounding differences

124

Business and properties The following table sets out the expiry profile of the tenancies of the Properties(1) as at 30 June 2007:
Monthly gross rent of expiring leases as a percentage of forecast rental (%)

Period

Total number of expiring leases

NLA of expiring leases (sq m)

Expiring leases as a percentage of NLA as at 30 June 2007

2007 . . . . . . . 2008 . . . . . . . 2009 . . . . . . . Beyond 2009 . Vacant . . . . . . Total . . . . . . . Note:

. . . . . .

.. .. .. .. .. ..

.. .. .. .. .. ..

.. .. .. .. .. ..

.. .. .. .. .. ..

.. .. .. .. .. ..

.. .. .. .. .. ..

.. .. .. .. .. ..

. . . . . .

.. .. .. .. .. ..

.. .. .. .. .. ..

.. .. .. .. .. ..

.. .. .. .. .. ..

.. .. .. .. .. ..

.. .. .. .. .. ..

. . . . . .

193 262 222 802 1,479

8,360 24,592 15,797 246,172 18,531 313,452

3.8 8.5 9.0 66.5 12.2 100.0

2.7 7.8 5.0 78.5 5.9 100.0(2)

(1) Assuming that the Master Lease Agreements for the Retail Spaces were executed on 30 June 2007. (2) Due to rounding differences. Purchase price of the Properties(1) The table below shows the purchase price of each of the Properties, taking into account estimated issue costs of the Offering and issue costs of the Cornerstone Units (assuming that the Over-allotment Option is not exercised). (See Certain Agreements Relating to LMIR Trust and the Properties).
Purchase price based on Offering Price (S$ million)

Property

Retail Malls Gajah Mada Plaza . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Cibubur Junction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . The Plaza Semanggi . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Mal Lippo Cikarang . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Ekalokasari Plaza. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Bandung Indah Plaza . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Istana Plaza . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Sub-total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Retail Spaces Mall WTC Matahari Units . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Metropolis Town Square Units . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Depok Town Square Units . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Java Supermall Units . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Malang Town Square Units. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Plaza Madiun . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Grand Palladium Medan Units . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Sub-total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Notes:

77.8 74.5 175.8 61.0 54.5 97.5 94.4 635.5 20.8 27.7 21.2 21.4 21.1 27.6 21.6 161.2(2) 796.8(2)

(1) The purchase consideration of the Properties is determined by the difference between the purchase consideration of the Singapore SPCs (See Certain Agreements relating to LMIR Trust and the PropertiesDescription of the Singapore SPC Share Purchase Agreements for the formula of determining this purchase consideration) and the fair value of all the net identifiable assets and liabilities of the Singapore SPCs acquired save for the Properties. (2) Due to rounding differences.
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Business and properties ASSET ENHANCEMENT The Manager will continually review and investigate asset enhancement works for each Property. The aim of this is to create further income streams and maximise retail offering at each mall. To do this, the Manager intends to work with relevant Indonesian authorities to gain the necessary approvals. The table below gives a summary of potential and completed asset enhancement works.
Property Key asset enhancement plans

Gajah Mada Plaza . . . . . . . . Cibubur Junction . . . . . . . . . .

The Plaza Semanggi. . . . . . . Mal Lippo Cikarang . . . . . . . .

Ekalokasari Plaza . . . . . . . . .

Bandung Indah Plaza . . . . . . Istana Plaza . . . . . . . . . . . . .

Potential improvements to the faade, main lobby, atrium and further enhancement of the tenancy mix will be investigated. Expansion of Matahari Department Store at the third level has been recently completed. Relocation of the food court from the upper level to the basement. Development of Plangi on the Sky, a rooftop open air cafe, adding approximately 3,000 sq m to the NLA. Expansion of NLA by 10,694 sq m from construction of an extension annex has been recently completed. As at 30 June 2007, 8,539 sq m or approximately 79.8% of the additional NLA created from asset enhancement has been precommitted to Hypermart. Reconfiguration of the Matahari Department Store. Addition of a third floor with NLA of approximately 3,263 sq m and a mezzanine with NLA of approximately 1,750 sq m has been recently completed. The additional NLA will be occupied by a food court, proposed fitness centre and potentially, a cinema which, together, anchor the top levels of the centre, which is expected to enhance shopper traffic on the higher floors of the mall and average gross rentals for the entire mall. As at 30 June 2007, 670 sq m or approximately 13.4% of the additional NLA created from the asset enhancement works has been precommitted. An additional NLA of approximately 3,843 sq m has been recently completed. Investigate converting ice skating rink to retail.

Each of Bandung Indah Plaza, Mal Lippo Cikarang and Ekalokasari Plaza has either obtained, or is in the process of obtaining, final local government approval for the recently completed asset enhancement works which have created additional NLA. INSURANCE The Properties are insured consistent with industry practice in Indonesia. This includes property damage, public liability insurance (including personal injury) policies, earthquakes, terrorism and sabotage. There are no significant or unusual excess or deductible amounts required under such policies. There are, however, certain types of risks that are not covered by such insurance policies, including acts of war and outbreaks of contagious diseases. LEGAL PROCEEDINGS None of LMIR Trust, the Manager and the Master Lessee is currently involved in any material litigation nor, to the best of the Managers knowledge, is any material litigation currently contemplated or threatened against LMIR Trust, the Manager and the Master Lessee. ENCUMBRANCES As at the Listing Date, there are no encumbrances which are outstanding with regard to any of the Properties.
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Business and properties INFORMATION REGARDING THE TITLE OF THE PROPERTIES The Retail Malls Each of the seven Retail Malls is wholly-owned by a Retail Mall Indonesian SPC which is, in turn, owned by two Retail Mall Singapore SPCs (See Summary of Ownership Structure of the Retail Malls). LMIR Trust will, via its direct or indirect ownership of 100% of the shares of each of the Retail Mall Singapore SPCs, indirectly hold the Retail Malls. (See Certain Agreements Relating to LMIR Trust and the PropertiesSummary of Ownership Structure of the Retail Malls.) With the exception of Gajah Mada Plaza and Mal Lippo Cikarang, LMIR Trust owns the remaining five Retail Malls via BOT Schemes (as defined below) and does not directly own the land on which the relevant Retail Mall is situated. The table below sets out the types of titles held by LMIR Trust:
Retail mall Title held by the land owner(1) Title/right held by LMIR Trust(2)

Gajah Mada Plaza . . . . . . . . . Cibubur Junction . . . . . . . . . . . The Plaza Semanggi. . . . . . . . Mal Lippo Cikarang . . . . . . . . . Ekalokasari Plaza . . . . . . . . . . Bandung Indah Plaza . . . . . . .

. . . . . .

Strata titles HGB title HP title HGB title HP title HPL titles HGB titles

Istana Plaza . . . . . . . . . . . . . . .

Strata titles BOT Scheme BOT Scheme HGB title BOT Scheme BOT Scheme and HGB titles on top of HPL titles(3) BOT Scheme

Notes: (1) The title held by the owner of the land on which the Retail Mall is situated. (2) The title/right held by LMIR Trust via its ownership of shares in the respective Retail Mall Singapore SPCs. (3) The BOT Grantor has granted the BOT Grantee, the owner of Bandung Indah Plaza, the right to apply for HGB titles on top of its HPL titles. (See Hak Pengelolaan (HPL) titles.) Build, operate and transfer schemes (BOT schemes) The relevant Retail Mall Indonesian SPCs will own five of the seven Retail Malls, namely, Cibubur Junction, The Plaza Semanggi, Ekalokasari Plaza, Bandung Indah Plaza and Istana Plaza, via BOT Schemes. The relevant Retail Mall Indonesian SPCs are in turn owned by two Retail Mall Singapore SPCs. As at the Listing Date, LMIR Trust will, via its direct or indirect ownership of 100% of the shares of each of the Retail Mall Singapore SPCs, indirectly hold these Retail Malls. A BOT Scheme is not registrable with any Indonesian authority. Rights under a BOT Scheme do not amount to a legal title and represent only contractual interests. Pursuant to BOT Schemes, the owner of the land on which the relevant Retail Mall is situated or the party that is appointed by the land owner (the BOT Grantor) has granted the relevant Retail Mall Indonesian SPC (the BOT Grantee), a right to build and operate the Retail Mall for a particular period of time as stipulated in the BOT Agreement. The respective BOT Grantor for the relevant Retail Malls are not related or affiliated with the respective Vendors or the Sponsor. The relevant BOT Grantors are regional Indonesian Government enterprises, Indonesian Government agencies and a church foundation. In exchange for the right to build and operate the Retail Mall on the land owned by the BOT Grantor, the BOT Grantee is obliged to pay a certain compensation (as stipulated in the BOT Agreement) to the BOT Grantor. The relevant Retail Mall Indonesian SPC, as the BOT Grantee, financed the construction of the relevant Retail Mall and on an ongoing basis, pays for the asset enhancement works of the Retail Mall (if any). Depending on the terms of the relevant BOT agreement, the payment by the BOT Grantee may be made in the form of a lump sum (Istana Plaza and Ekalokasari Plaza, both of which have been fully paid) or staggered (Bandung Indah Plaza, Cibubur Junction and The Plaza Semanggi).
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Business and properties LMIR Trust has, via its wholly-owned Retail Mall Singapore SPCs, entered into share purchase agreements to acquire the entire share capital of the relevant Retail Mall Indonesian SPC. LMIR Trust will, through the Retail Mall Singapore SPCs, indirectly own the Retail Mall for the period stipulated in the respective BOT Agreement. The term of BOT Agreements ranges from 20 years to 30 years and may be extended upon agreement of both parties. During the term of the BOT Agreement, the respective BOT Grantor is not allowed to sell or transfer the land on which the relevant Retail Mall is situated. Upon the expiry of the term of the BOT Agreement, the BOT Grantee must return the land, together with any buildings and fixtures on top of the land, without either party providing any form of compensation to the other. The BOT Grantee may assign its rights under the BOT Agreement with prior consent of the BOT Grantor. The BOT Agreements are silent on the circumstances under which the respective BOT Grantor may withhold its consent to such an assignment. Under Indonesian law, a transfer of rights under an agreement must be approved or acknowledged by the opposite party. Therefore, if a BOT Grantee assigns its rights under the BOT Agreement without the consent of the BOT Grantor, the assignment will not be effective and the BOT Grantee shall be deemed to have caused a breach of contract. Instead of a transfer of a BOT Grantees right through an assignment of the BOT Agreement, which requires consent from the BOT Grantor, the transfer of the BOT interest may also be made through a transfer of shares in the BOT Grantee by the shareholders of the BOT Grantee. Except for the BOT Agreement relating to Cibubur Junction, the transfer of shares in the BOT Grantee does not require consent from the BOT Grantor. In respect of Cibubur Junction, the BOT Grantor has approved the transfer of shares in Cibubur Junction to its relevant Retail Mall Singapore SPCs, as evidenced by Letter No. 306/076.11, dated 4 April 2007, issued by the respective BOT Grantor. (See Overview of Relevant Laws and Regulations in IndonesiaRights to Own and/or UseBuild, Operate and Transfer or BOT). LMIR Trust owns the Retail Malls, via its 100% ownership interests of shares in the Retail Mall Singapore SPCs, under BOT Schemes because: Freehold land in Indonesia may not be owned by companies (whether Indonesian or foreign-owned) or by foreign individuals. Under Indonesian land law, the closest form of land title to an internationally recognised concept of freehold title is Hak Milik (HM) or Right of Ownership. A Hak Milik title is available only to Indonesian individuals and certain Indonesian religious and social organisations and government bodies. In the Indonesian property market, it is common for properties to be held under agreements or schemes without the legal title being transferred. (See Overview of Relevant Laws and Regulations in IndonesiaRights to Own and/or to UseHak Milik (HM/Right to Own)); Instead of transferring the ownership of the land, the land owner may prefer to use the BOT Scheme for commercial reasons. The land owner may not intend to transfer the ownership of the land because the land is located at commercially strategic locations or has historical value. Alternatively, the land owner may have limited financial capability to develop the land. Under such circumstances, the land owner may prefer to enter into a BOT Agreement with a BOT Grantee who are property developers with strong financial support and proven track records; or A BOT Grantee may prefer to use the BOT Scheme because the compensation for obtaining the BOT rights could be considered as more price feasible and cash flow effective as compared to an outright purchase of the land. Strata titles One of the seven Retail Malls, namely, Gajah Mada Plaza, is held via strata titles. Under Indonesian land law, a building developer must divide a multi-storey building into (i) rights of ownership (strata title) for each unit, (ii) rights on common properties and (iii) rights to the common land in the form of a sketch plan, which must be approved by the relevant authority. Such sketch plan must also provide an explanation on (i) unit separation that can be used by individuals, (ii) the limitation and separation of the strata title right over common properties, and (iii) the strata title right over the common land. In general, if a party holds a property via strata titles, the party that owns the strata title unit, will also own the common areas, common property and common land (i.e. the underlying land) proportionately with the
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Business and properties other strata title unit owners. LMIR Trust indirectly owns, via the relevant Retail Mall Indonesian SPC, approximately 99.0% of the units of strata titles that are constructed on the relevant plot of land on which Gajah Mada Plaza is situated on. (See Overview of Relevant Laws and Regulations in IndonesiaRights to Own and/or to UseStrata Titles.) Hak Guna Bangunan (HGB) titles One of the Retail Malls, namely, Mal Lippo Cikarang, is held via a HGB title. Under Indonesian land law, the highest title which can be obtained by a company incorporated or located in Indonesia is a Right to Build or HGB title. HGB titles can only be obtained by an Indonesian citizen, or by a legal entity which is incorporated under Indonesian law and located in Indonesia including foreign investment companies (Penanaman Modal Asing, or PMA). A holder of HGB title has the right to erect, occupy and use buildings on that particular parcel of land, and also has the right to encumber and sell all or part of the parcel. The validity period for a HGB title is different from that of a freehold title. A freehold title has no limitation on the validity period. A HGB title is granted for a maximum initial term of 30 years. By application to the relevant local land office upon the expiration of this initial term, a HGB title may be extended for an additional term not exceeding 20 years. Following expiration of this additional term, a renewal application may be made. The application should be made no later than two years prior to the expiration of the additional term. The land office has discretion to grant the various extensions. (See Overview of Relevant Laws and Regulations in IndonesiaRights to Own and/or to Use.) Hak Pakai (HP) titles Two of the Retail Malls, namely The Plaza Semanggi and Ekalokasari Plaza, are situated on plots of land which are owned by the land owner under HP (Right to Use) titles. LMIR Trust does not own these plots of land directly and instead, holds the two Retail Malls via BOT schemes. The land owner (as the BOT Grantor) has granted the relevant Retail Mall Indonesian SPC (as BOT Grantee), a right to build and operate the relevant Retail Mall for a particular period of time as stipulated in the BOT Agreement. The HP titles where Plaza Semanggi and Ekalokasari Plaza are constructed will be valid as long as the lands are being used by the respective land owner. A HP title allows its holder (i.e. the land owner) the right to use and/or collect the products of land directly administered by the State or of land owned by other persons. Hak Pakai over land can be granted by the Indonesian government in the form of a decree or by an Indonesian citizen in the form of an agreement. The decree or the agreement gives the user the rights and obligations laid down in that decree or agreement. A HP title in Indonesia may be obtained and owned by the following entities: (a) an Indonesian citizen, (b) a legal entity established under Indonesian law and domiciled in Indonesia, (c) any Indonesian government department or government agency, (d) any social or religious entity, (e) a foreign citizen residing in Indonesia and who has provided benefit to Indonesia, (f) a foreign legal entity that has a registered representative office in Indonesia, and (g) a state representative or a representative of certain international bodies. (See Overview of Relevant Laws and Regulations in IndonesiaRights to Own and/or to Use.) Hak Pengelolaan (HPL) titles In the case of Bandung Indah Plaza, the BOT Grantor owns the land on which the Retail Mall is situated under a HPL (Right to Manage) title. A HPL title provides its holder (i.e. the land owner) with the right to manage on a parcel of land created by the state, in which the executing authorities of such right to manage is partially granted and in common practice (only) to Indonesian government entities. Such holder of a Right to Manage title may use the granted executing authority for the purpose of land utilisation and allocation planning, utilisation of the land related to the role of such Indonesian government entities, partial assignment of the land to third parties and/or land management in cooperation with third parties. Bandung
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Business and properties Indah Plaza is constructed on land under HPL titles which will be valid as long as the land is being used by the land owner. In respect of Bandung Indah Plaza, the land owner (as BOT Grantor) has granted the relevant Retail Mall Indonesian SPC (as BOT Grantee) the right to apply for a HGB title on top of its HPL (Right to Manage) title. Pursuant to this BOT Scheme, the BOT Grantee is granted the right to build and operate the Retail Mall and to own a HGB title for the term of the BOT Agreement. Ownership of the HGB title allows the BOT Grantee to encumber the land with prior consent of the BOT Grantor and subject to the BOT Agreement. (See Overview of Relevant Laws and Regulations in IndonesiaRights to Own and/or to Use.) The Retail Spaces Each of the seven Retail Spaces is wholly-owned by a Retail Space Indonesian SPC which is, in turn, owned by two Retail Space Singapore SPCs. LMIR Trust will, via its ownership of 100% of the shares of the respective Retail Space Singapore SPCs, indirectly own the Retail Spaces. (See Certain Agreements Relating to LMIR Trust and the PropertiesSummary of Ownership Structure of the Retail Spaces.) The Retail Spaces are held by the respective Indonesian SPCs under the following types of title:
Retail Space Held by LMIR Trust via:

Mall WTC Matahari Units . . . . . . . . . . . . . . . . . . Metropolis Town Square Units . . . . . . . . . . . . . . Depok Town Square Units . . . . . . . . . . . . . . . . . Java Supermall Units . . . . . . . . . . . . . . . . . . . . . Malang Town Square Units. . . . . . . . . . . . . . . . . Plaza Madiun . . . . . . . . . . . . . . . . . . . . . . . . . . . Grand Palladium Medan Units . . . . . . . . . . . . . . Strata titles

. . . . . . .

Strata titles ownership certificates Kiosks Sale and Purchase Binding Agreement Kiosks Sale and Purchase Binding Agreement Strata titles ownership certificates Kiosks Sale and Purchase Binding Agreement HGB titles Kiosks Sale and Purchase Binding Agreement

Two of the Retail Spaces, namely Mall WTC Matahari Units and Java Supermall Units are held via Strata Titles. (See The Retail MallsStrata Titles.) Kiosks Sale and Purchase Binding Agreement As at the Latest Practicable Date, four of the seven Retail Spaces, namely Metropolis Town Square Units, Depok Town Square Units, Malang Town Square Units and Grand Palladium Medan Units, are each bound by Kiosks Sale and Purchase Binding Agreements because their strata titles are in the process of being issued by the Indonesian government. A Kiosks Sale and Purchase Binding Agreement is regulated by Article 1338 of the Indonesian Civil Code. In addition, for a strata title, it is a common practice to enter into a Kiosks Sale and Purchase Binding Agreement prior to entering into a deed of sale and purchase of land. Under a Kiosks Sale and Purchase Binding Agreement, each of the parties agree on the terms and conditions for the transaction (i.e. the sale and purchase of land) but the Kiosks Sale and Purchase Binding Agreement does not have the effect of transferring the ownership of the land to the other party. Instead, subject to certain conditions in the Kiosks Sale and Purchase Binding Agreement, the vendor is bound to sell the land and the purchaser is bound to purchase the land. These agreements shall be executed in good faith and cannot be revoked except by mutual agreement or pursuant to certain reasons which have been legally declared as sufficient. Upon the completion of the conditions stipulated in the said agreement (including the issuance of the strata title certificate), the parties enter into a deed of sale and purchase which shall be made before the local land deed official. Once the parties enter into a deed of sale and purchase agreement, the vendor is deemed to have sold and transferred its rights of ownership of the land to the purchaser, who is in turn, deemed to have accepted the transfer of the said rights from the vendor. Pursuant to the Basic Principal of Agrarian Law No. 5/1960, the transfer of ownership rights over the land is perfected upon registration at the local land office.
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Business and properties Because of this unique nature of Indonesian land law, the SGX-ST has granted LMIR Trust a waiver from compliance with Rule 222(1) of the SGX-ST Listing Manual (the Listing Manual) which requires properties that have remaining leases of less than 30 years not to, in aggregate, account for more than 50.0% of a companys operating profits for the past three years. The Sponsor intends to procure the strata titles of these Retail Spaces prior to the Listing Date. However, the legal process to obtain these strata titles may be lengthy and may only be issued post listing. The Trustee and the Master Lessee have entered into a put option agreement pursuant to which, in the event that the strata titles to these four Retail Spaces are not issued within 24 months from the Listing Date, a meeting of all the Unitholders will be convened by the Trustee pursuant to which the Unitholders will vote, by way of an ordinary resolution, on whether to retain these four Retail Spaces in the portfolio of LMIR Trust for a further six months from the date of the ordinary resolution. In the event that an ordinary resolution is passed in favour of retaining these four Retail Spaces in the portfolio of LMIR Trust and the strata titles are still not issued upon expiry of six months from the date of the ordinary resolution, the Trustee shall be entitled to exercise the put option. In the event that an ordinary resolution is not passed in favour of retaining these four Retail Spaces, the Trustee shall be entitled to exercise the put option within three months of the date of the meeting of the Unitholders. Upon exercising the put option, the Master Lessee will be required to purchase the entire issued and paid-up capital of the relevant Indonesian SPCs of these four Retail Spaces at the consideration of the higher of (i) the net asset value of the relevant Indonesia SPCs as at the date of service of the put option notice as determined from the audited consolidated accounts of the SPCs and (ii) the net asset value based on the value attributed to these four Retail Spaces for the purpose of the Listing, in each case, also taking into account all transaction costs incurred directly and indirectly by LMIR Trust for the acquisition of these four Retail Spaces. (See Certain Agreements relating to LMIR Trust and the Properties Description of the Put Option Agreements.) The Trustee (acting on the advice and recommendation of, and after discussions with, the Manager) is satisfied with the computation of the said transaction costs as set out in the put option agreement. A 24-month period is sought as the length of time required for the land title office to issue the strata title is estimated to be more than 12 months. The parties will operate as if LMIR Trust exclusively controls the strata titles to these four Retail Spaces during this 24-month period. The transfer of strata titles without prior written approval from Matahari will result in a breach of the Kiosks Sale and Purchase Binding Agreement. On 9 August 2007, the Trustee, the Manager and the Sponsor entered into a letter of undertaking, pursuant to which the Sponsor will to use its best endeavors to procure that the relevant Retail Space SPCs obtain the strata titles to the Metropolis Town Square Units, Depok Town Square Units, Malang Town Square Units and Grand Palladium Medan Units. (See Certain Agreements relating to LMIR Trust and the PropertiesDescription of the Letter of Undertaking.) The Trustee (acting on the advice and recommendation of, and after discussions with the Manager) is of the view that the proposed arrangements, namely the put option agreement and the letter of undertaking, adequately safeguard the interest of Unitholders if the legal titles to the four Retail Spaces are not issued on the expiry of 24 months from the Listing Date. HGB titles One of the Retail Spaces, namely Plaza Madiun is held via a HGB title. (See The Retail MallsHak Guna Bangunan (HGB) titles.)

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Business and properties GAJAH MADA PLAZA JaIan Gajah Mada 19-26, Central Jakarta

Jakarta profile The province of Jakarta is the capital of Indonesia. It consists of five municipalitiesNorth Jakarta, East Jakarta, South Jakarta, West Jakarta and Central Jakarta. As the administrative centre of Indonesia, Jakartas economy is based on finance and commerce and attracts a particularly high level of foreign investment compared to other parts of Indonesia. Income per capita is also high driven partly by a high number of expatriates living in the city, as well as the types of employment available in the area. According to a 2005 Census, the population of Greater Jakarta was 7.5 million. Despite rapid urbanisation over the past 40 years (with population at only 1.2 million in 1960), and solid growth for Indonesia as a whole, population in Greater Jakarta has been declining over the past five years. This is a result of a decline in the population of Central Jakarta, driven by the changing composition of the city from relatively high levels of residential accommodation to an increasing mix of office development, convention centres and hotels. Over the next five years, the population of Central Jakarta is expected to begin increasing, and particularly strong growth is also expected in South Jakarta. As the largest city in Indonesia, Jakarta has the highest GRDP (current prices) per capita with average growth rate of about 14% per annum over the past four years. Total household expenditure in Jakarta grew at an average rate of 12.8% for the period from 2001 to 2006, from Rp. 19,277 billion in 2001 to Rp. 35,273 billion in 2006. Apart from increases in income driving retail spending growth, spending has also been boosted by a lifestyle shift towards a higher level of consumerism. Description Gajah Mada Plaza is a seven storey with one basement level shopping centre and a carpark comprising 885 parking lots. The mall is located prominently in the heart of Jakartas Chinatown, an established and
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Business and properties well-known commercial area in the city. Situated along Jalan Gajah Mada, one of the main roads in Jakarta, Gajah Mada Plaza is positioned as a one-stop shopping, dining and entertainment destination for middle to upper income families as well as professional executives and students from the offices and schools within its vicinity. The 222 tenancies in the mall provide a diverse and complementary tenant mix anchored by Hypermart and Rimo Department Store. The malls strong leisure and entertainment component, which includes a cinema, restaurants, family karaoke outlets, a discotheque, video game centres, a fitness centre and a swimming pool, adds to the overall attractiveness of Gajah Mada Plaza. Tenant profile Gajah Mada Plaza has 222 retail tenants, based on Committed Leases as at 30 June 2007. The tenant profile of the mall comprises a diverse set of tenants from a wide variety of industries. The mall is anchored by Hypermart and Rimo Department Store, which occupy approximately 14.5% and 8.0% of the malls NLA, respectively. The other prominent tenants include Millennium International Executive Club, which operates as a restaurant during the day and as a discotheque late at night, McDonalds, Kentucky Fried Chicken and Inul Vista Karaoke. The mall has a good tenancy mix which caters to the daily needs of its customers. It is also well known for its specialty stores providing products and services such as pets, jewellery, information technology products, dining and entertainment. Asset enhancement plans In late 2007, a new cellphone centre on the semi-ground level will be set up, the pet centre will be improved and enlarged, and the second floor will be converted to provide for a more family-oriented merchandise mix. Other plans under consideration include enhancement of the external and internal presentation of the mall. This includes improvements to the facade, main entrance and atrium, as well as enhancement to the tenancy mix. The following chart provides a breakdown (by area) of the various trade sub-sectors represented in Gajah Mada Plaza as at 30 June 2007: Gajah Mada PlazaTrade sector analysis (By area)
Trade sub sector Leisure & Entertainment Supermarket/Hypermarket Food & Beverage/Food Court Department Store Other Gifts & Specialty Electronic/IT Fashion Home Furnishings Sports & Fitness Services Books & Stationery Hobbies Contribution (%) 35.5 16.6 10.8 9.2 8.0 7.0 5.2 2.8 2.0 1.2 1.1 0.3 0.3

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Business and properties The table below sets out information on the 10 largest tenants of Gajah Mada Plaza based on Committed Leases as at 30 June 2007:
Percentage of the total base rental income of Gajah Mada Plaza based on Committed Leases as at 30 June 2007 (%)

Tenant

Business sector

Lease expiry date

Percentage of total NLA (%)

Millennium International Executive Club . . . . . . . Rimo Department Store . . Hypermart. . . . . . . . . . . . McDonalds . . . . . . . . . . . Inul Vista . . . . . . . . . . . . Resto Mart . . . . . . . . . . . Gajah Mada 21 . . . . . . . . Hanamasa . . . . . . . . . . . Platinum Resto . . . . . . . . Optical Seis. . . . . . . . . . .

. . . . . . . . . .

Leisure & Entertainment Department Store Supermarket/Hypermarket F&B Leisure & Entertainment F&B Leisure & Entertainment F&B F&B Gifts & Specialty

29 October 2014 30 June 2008 2 February 2015 28 July 2013 31 August 2011 30 April 2009 31 March 2013 31 October 2007 30 April 2009 30 April 2009

20.2 8.0 14.5 1.8 2.6 1.2 4.9 0.5 0.7 0.2 54.5(1) 45.5 100.0

8.6 7.7 7.3 3.6 2.5 2.1 1.9 1.8 1.8 1.6 38.7(1) 61.3 100.0

10 largest tenants . . . . . . . Other tenants . . . . . . . . . . Total . . . . . . . . . . . . . . . .

Note: (1) Due to rounding differences. Expiry profile The following table sets out the expiry profiles of the tenancies at Gajah Mada Plaza as at 30 June 2007:
Monthly Gross Rent of expiring leases as a percentage of forecast rental income (%)

Period

Total number of leases expiring

NLA of expiring leases (sq m)

Expiring leases as a percentage of NLA as at 30 June 2007 (%)

FY2007 . . . . . . . FY2008 . . . . . . . FY2009 . . . . . . . Beyond FY2009. Vacant. . . . . . . .

. . . . .

. . . . .

. . . . .

. . . . .

. . . . .

. . . . .

. . . . .

. . . . .

. . . . .

. . . . .

. . . . .

. . . . .

. . . . .

64 107 27 24 222

3,241 12,069 1,225 14,002 3,741 34,278

13.6 33.0 10.5 24.2 18.8 100.0(1)

9.5 35.2 3.6 40.8 10.9 100.0

Total . . . . . . . . . . . . . . . . . . . . . . Note: (1) Due to rounding differences. Competition

Existing: Located in Jakartas affluent Chinatowns precinct, Gajah Mada Plaza currently faces strong competition from 13 retail malls with an aggregate NLA in excess of 20,000 sq m and located within a six km radius. Many of these retail malls compete for the same target segment as Gajah Mada Plaza and may potentially impact the sales growth that can be achieved at Gajah Mada Plaza.
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Business and properties The largest competing retail malls are: Mal Taman Anggrek, situated three km to the southwest of Gajah Mada Plaza, which comprises approximately 97,000 sq m of retail space including Metro and Galleria department stores and also a Hero Supermarket; Cosmopolitan Mall Pluit, situated six km northwest of Gajah Mada Plaza and anchored by both Matahari Department Store and Carrefour hypermarket, is currently undergoing extensive asset enhancements which will potentially increase its retail space and improve the positioning of the mall with shoppers in its catchment areas. The estimated NLA is 88,040 sq m after asset enhancements. As at Listing Date, LMIR Trust has entered into a non-binding memorandum of understanding with PT. Multi Pratama Gemilang Perkasa (Pikko Group) to acquire Cosmopolitan Mall Pluit (see Potential Acquisition of Properties from Third Party Vendors); Mal Ciputra, situated three km west of Gajah Mada Plaza and anchored by Batik Keris, Matahari Department Store and Hero Supermarket, comprises around 51,000 sq m of retail space; Mega Glodok Kemayoran is situated three km east of Gajah Mada Plaza and anchored by Indonesia Marine Centre and Home Ciento. The strata mall has a tenancy mix dominated by automotive parts retailers; Plaza Indonesia is a high-end retail mall targeting the upper income shopper segment and is situated three km south of Gajah Mada Plaza. The mall contains 42,000 sq m of mainly high-end retailing, including a Debenhams department store; Jakarta City is located three km south of Gajah Mada Plaza and is a strata mall anchored by a Hypermart but without a department store; and Mangga Dua contains a number of retail facilities, predominantly strata malls, and located three km north of Gajah Mada Plaza. The main malls include Mangga Dua Square (60,000 sq m of NLA), WTC Mangga Dua (45,000 sq m of NLA), ITC Mangga Dua (44,000 sq m) and Mal Mangga Dua (35,000 sq m). These retail malls target the lower to middle income segment households. Future: The competitive environment of Gajah Mada Plazas trade area is expected to intensify over the next five years, with the planned development of a number of new competing retail malls. There are a number of retail projects currently under construction which will target middle income households within Gajah Mada Plazas population catchment. These developments include: Gajah Mada Square, a lease mall with an estimated NLA of 35,000 sq m, which is scheduled to begin operations in the third quarter of 2007 and is located one km from Gajah Mada Plaza; Mall of Indonesia, which is scheduled to begin operations in the first quarter of 2008; Seasons City, a strata mall with an estimated NLA of 40,000 sq m, which is scheduled to begin operations in 2008, located three km from Gajah Mada Plaza and anchored by Carrefour hypermarket; and Emporium, a lease mall with an estimated NLA of 63,000 sq m, which is scheduled to begin operations in the second quarter of 2009 and will be located five km from Gajah Mada Plaza. These new retail malls may potentially reduce the sales growth at Gajah Mada Plaza. (See Appendix FIndependent Report on the Indonesian Retail Property Market.) Other information The following table sets out other relevant information relating to Gajah Mada Plaza. Year of building completion . . . . . . . . Strata Title Area . . . . . . . . . . . . . . . . GFA as at 30 June 2007 . . . . . . . . . . NLA as at 30 June 2007 . . . . . . . . . . 1982 37,501 sq m 66,160 sq m 34,278 sq m
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Business and properties Occupancy rate as at 30 June 2007. . Appraised value by Knight Frank as at 30 June 2007 . . . . . . . . . . . . . . . . . . Appraised value by Colliers as at 30 June 2007 . . . . . . . . . . . . . . . . . . Car parking lots . . . . . . . . . . . . . . . . . Motorcycle parking lots . . . . . . . . . . . Population catchment . . . . . . . . . . . . Title . . . . . . . . . . . . . . . . . . . . . . . . . . 89.1% S$103.8 million S$117.0 million 885 665 429,298 households(1) Strata Titles as evidenced by certificates : (i) (ii) (iii) (iv) (v) (vi) (vii) (viii) (ix) (x) (xi) No. 438/I/S Kel Petojo Utara, registered under the name of PT Graha Baru Raya, covering an area of 5,186.1 sq m; No. 440/II/S Kel Petojo Utara, registered under the name of PT Graha Baru Raya, covering an area of 4,755.6 sq m; No. 442/III/S Kel Petojo Utara, registered under the name of PT Graha Baru Raya, covering an area of 4,918.6 sq m; No. 325/-I/S Kel Petojo Utara, registered under the name of PT Graha Baru Raya, covering an area of 5,228.0 sq m; No. 326/-I/S Kel Petojo Utara, registered under the name of PT Graha Baru Raya, covering an area of 135.0 sq m; No. 328/I/S Kel Petojo Utara, registered under the name of PT Graha Baru Raya, covering an area of 18 sq m; No. 330/II/S Kel Petojo Utara, registered under the name of PT Graha Baru Raya, covering an area of 17 sq m; No. 332/III/S Kel Petojo Utara, registered under the name of PT Graha Baru Raya, covering an area of 43 sq m; No. 333/IV/S Kel Petojo Utara, registered under the name of PT Graha Baru Raya, covering an area of 4,618 sq m; No. 334/V/S Kel Petojo Utara, registered under the name of PT Graha Baru Raya, covering an area of 2,645 sq m; No. 335/V-VI-VII/S Kel Petojo Utara, registered under the name of PT Graha Baru Raya, covering an area of 3,205 sq m; No. 336/VI-VII/S Kel Petojo Utara, registered under the name of PT Graha Baru Raya, covering an area of 4,534 sq m; No. 337/VII/S Kel Petojo Utara, registered under the name of PT Graha Baru Raya, covering an area of 1,607 sq m; and No. 338/VIII/S Kel Petojo Utara, registered under the name of PT Graha Baru Raya, covering an area of 591 sq m.

(xii)

(xiii)

(xiv)

The above strata titles are constructed on underlying HGB common land, valid until 24 January 2020 and are extendable for another term of up to 20 years. Following expiration of this additional term, a renewal application may be made. (See
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Business and properties Overview of the Relevant Laws and Regulations in Indonesia Rights to Own and/or to UseStrata Titles) Average Specialty Base Rent as at 30 June 2007 (Rp.000 per sq m per month) . . . . . . . . . . . . . . . . . . . . . . . NPI for Forecast Period 2007, Projection Year 2008 and Projection Year 2009 (S$000) . . . . . . . . . . . . . .

106

Forecast Period 20073,726 Projection Year 20088,319 Projection Year 200910,253

Percentage of contribution to LMIR Trusts Gross Rent for Forecast Period 2007 . . . . . . . . . . . . . . . . . . . . . . . . . 10.5% Note: (1) The figure comprises the number of households within the primary trade area of the relevant Retail Mall. (See Appendix FIndependent Report on the Indonesian Retail Property Market.)

137

Business and properties CIBUBUR JUNCTION Jalan Jambore Raya 1, Cibubur, East Jakarta

Jakarta profile (See Gajah Mada PlazaJakarta Profile.) Description Cibubur Junction is a five storey with one basement level and partial roof top level shopping centre with a carpark comprising 611 parking lots. The mall is located strategically in the middle of Cibubur which is one of the most affluent and upmarket residential areas in Jakarta. The mall is situated five km south of Jakartas Jagorawi toll road and is easily accessible and visible from the main road. Being the only retail mall with a NLA of above 20,000 sq m within an approximately 10-km radius, Cibubur Junction is the only mall within its locality that offers shoppers a one-stop shopping experience. Its anchor tenants, Hypermart and Matahari Department Store are well complemented by international and local specialty tenants which include restaurants, fashion labels, a cinema, bookstores, a video game centre and a fitness centre. Tenant profile As at 30 June 2007, Cibubur Junction has 163 retail tenants based on Committed Leases. The tenant profile of the mall comprises international brand names which target the middle to upper middle income residents within the trade area. These retailers include The Body Shop, Giordano, Polo Ralph Lauren, Charles & Keith, Guardian, Planet Surf, Starbucks Coffee and Pizza Hut. The lower ground floor is anchored by Hypermart, which accounts for approximately 25.8% of the NLA. The ground floor predominantly comprises retailers selling branded fashion and accessories, and quality F&B retailers. The lower ground floor and the ground floor are also used for exhibition and temporary leasing. The standard lease period for exhibition is two weeks per period. The standard lease period for temporary leases is six months per period. The area for exhibition on the lower level is approximately
138

Business and properties 200 sq m and is usually leased out for specialty products. The ground floor area is approximately 400 sq m and is usually leased out for automotive exhibitions. The upper ground and first floor are anchored by the Matahari Department Store, which is expanding to the second floor. The expanded Matahari Department Store accounts for 16.7% of the NLA as at 30 June 2007. The upper ground and first floor comprise a mix of specialty retailers in trade sectors such as fashion, childrens wear, accessories and beauty. A large Sports Warehouse store is on the first floor while Karisma Bookstore is on the upper ground. The tenant mix on the second floor focuses on entertainment and lifestyle. This floor includes the expanded Matahari Department Store, Timezone, Fitness First and Studio 21 Cinema. There are also a large number of small tenancies such as electronics and handphone retailers. The top level comprises Fitness First and Studio 21 Cinema (which has four screens). As at 30 June 2007, the average monthly rental rate of specialty stores in Cibubur Junction is approximately Rp. 200,000 per sq m. Asset enhancement plans Current asset enhancement plans include the expansion of the Matahari Department Store to the third level and relocation of the food court to the basement to achieve better synergies. The following chart provides a breakdown (by area) of the various trade sub-sectors represented in Cibubur Junction as at 30 June 2007: Cibubur JunctionTrade sector analysis (By area)

Trade sub sector

Supermarket/Hypermarket Department Store Food & Beverage/Food Court Fashion Leisure & Entertainment Sports & Fitness Home Furnishings Services Books & Stationery Other Electronic/IT Toys Gifts & Specialty Hobbies

Contribution (%)
26.4 17.1 15.2 9.7 7.8 7.2 5.5 2.6 2.5 2.2 1.8 1.0 0.7 0.3

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Business and properties The table below sets out information on the 10 largest tenants of Cibubur Junction based on Committed Leases as at 30 June 2007:
Percentage of the total base rental income of Cibubur Junction based on Committed Leases as at 30 June 2007 (%)

Tenant

Business sector

Lease expiry date

Percentage of total NLA (%)

Hypermart. . . . . . . . . . Matahari Department Store . . . . . . . . . . . . Fitness First . . . . . . . . Solaria . . . . . . . . . . . . Sport Warehouse. . . . . Studio 21 . . . . . . . . . . A&W . . . . . . . . . . . . . . Karisma . . . . . . . . . . . TimeZone . . . . . . . . . . Ring Master . . . . . . . . .

. . . . . . . . . .

Supermarket/Hypermarket Department Store Sports & Fitness F&B Fashion Leisure & Entertainment F&B Books and Stationery Leisure & Entertainment F&B

27 July 2015 30 August 2015 14 April 2021 14 April 2012 9 December 2010 23 March 2016 30 November 2012 30 November 2010 30 October 2015 29 March 2011

25.8 16.7 4.9 1.4 2.1 4.7 0.7 2.1 2.3 0.6 61.3(1) 38.7 100.0

14.2 11.2 3.0 2.8 2.1 1.6 1.6 1.5 1.5 1.3 40.8 59.2 100.0

10 largest tenants . . . . . Other tenants . . . . . . . . Total . . . . . . . . . . . . . .

Note: (1) Due to rounding differences. Expiry profile The following table sets out the expiry profiles of the tenancies at Cibubur Junction as at 30 June 2007:
Monthly gross rent of expiring leases as a percentage of forecast rental income (%)

Period

Total number of leases expiring

NLA of expiring leases (sq m)

Expiring leases as a percentage of NLA as at 30 June 2007 (%)

FY2007 . . . . . . . FY2008 . . . . . . . FY2009 . . . . . . . Beyond FY2009 . Vacant . . . . . . . .

. . . . .

. . . . .

. . . . .

. . . . .

. . . . .

. . . . .

. . . . .

. . . . .

. . . . .

4 6 7 146 163

83 237 287 28,892 4,641 34,139(1)

0.7 1.7 1.8 71.5 24.3 100.0

0.2 0.7 0.8 84.6 13.6 100.0(1)

Total . . . . . . . . . . . . . . . . . . Note: (1) Due to rounding differences. Competition

Existing: Cibubur Junction currently faces competition from the following smaller retail malls within a 10-km radius. Plaza Cibubur, located three km from Cibubur Junction, which commenced operations in 2001 and has a NLA of 17,000 sq m, anchored by Superindo Supermarket and Karisma bookstore. Mal Citra Gran, which commenced operations in 2001 and located five km from Cibubur Junction, has a NLA of 10,900 sq m and is anchored by Hero Supermarket.
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Business and properties Mal Cimanggis, which commenced operations in 2003, is located six km away with a NLA of 12,000 sq m, and is anchored by Naga supermarket. The above three competing retail malls position themselves as a convenient shopping location, as opposed to a destination mall, therefore targeting only their immediate population catchment. Within a 10-km radius, other competing retail malls include: Cileungsi Trade Centre, a strata mall with a NLA of 10,000 sq m, located eight km away with no anchor tenants. Tamini Square, a strata mall with a NLA of 35,000 sq m, located nine km away and anchored by Carrefour hypermarket and Cahaya Department Store. Despite the distance from Cibubur Junction, Cileungsi Trade Centre and Tamini Square compete for shoppers within their primary and secondary trade areas. Future: Appendix FIndependent Report on the Indonesian Retail Property Market indicates that, at present, there are no known proposals for new centres to compete directly with Cibubur Junction. However, given the relative strength of retail supply in recent years, it is possible that competing centres will be developed in the future. (See Appendix FIndependent Report on the Indonesian Retail Property Market.) Other information The following table sets out other relevant information relating to Cibubur Junction. Year of building completion . . . . . . . . Land Area . . . . . . . . . . . . . . . . . . . . . GFA as at 30 June 2007 . . . . . . . . . . NLA as at 30 June 2007 . . . . . . . . . . Occupancy rate as at 30 June 2007. . Appraised value by Knight Frank as at 30 June 2007 . . . . . . . . . . . . . . . . . . Appraised value by Colliers as at 30 June 2007 . . . . . . . . . . . . . . . . . . Car parking lots . . . . . . . . . . . . . . . . . Motorcycle parking lots . . . . . . . . . . . Population catchment . . . . . . . . . . . . Title . . . . . . . . . . . . . . . . . . . . . . . . . . 2005 31,987 sq m 49,341 sq m 34,139 sq m 86.4% S$94.2 million S$101.8 million 611 500 422,862 households(1) Cibubur Junction is owned by PT Cibubur Utama and was built pursuant to a BOT Scheme based on the deed of cooperation agreement on Land Utilisation for Construction and Development of a Shopping Centre Located at CibuburEast Jakarta (Perjanjian Kerjasama tentang Pendayagunaan Lahan Untuk Pembangunan dan Pengembangan Gedung Pusat Perbelanjaan terletak di CibuburJakarta Timur) No. 68, dated 28 July 2003, between PD Pembangunan Sarana Jaya DKI Jakarta as BOT Grantor and PT Cibubur Utama as BOT Grantee, made before Imas Fatimah S.H., Notary in Jakarta, as amended by Addendum I dated 25 November 2004 and Addendum II dated 26 November 2004. PD Pembangunan Sarana Jaya DKI Jakarta, as BOT Grantor, owns a plot of land located in Cibubur covering an area of 31,987 sq m based on Certificate of HGB No. 01210/Cibubur dated
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Business and properties 24 December 2001 and valid until 23 December 2021. Under the BOT agreement, PD Pembangunan Sarana Jaya DKI Jakarta and PT Cibubur Utama agree to enter into a cooperation agreement, at which PD Pembangunan Sarana Jaya DKI Jakarta agrees to provide the land and PT Cibubur Utama agrees to construct a shopping centre over the land. Cibubur Junction BOT arrangement between PT Cibubur Utama and PD Pembangunan Sarana Jaya DKI Jakarta shall be valid until 28 July 2025. PT Cibubur Utama (as BOT Grantee) cannot assign its rights under the BOT agreement and transfer the share ownership of the shareholders of PT Cibubur Utama to another party unless prior written approval is obtained from PD Pembangunan Sarana Jaya DKI Jakarta (as BOT Grantor). Consent of the transfer of shares in Cibubur Junction to its relevant Retail Mall Singapore SPC has been obtained as evidenced by Letter No. 306/076.11, dated 4 April 2007, issued by the BOT Grantor. The land on which Cibubur Junction is situated is owned by PD Pembangunan Sarana Jaya DKI Jakarta. Therefore, PT Cibubur Utama has no right to encumber or transfer the land. Average Specialty Base Rent as at 30 June 2007 (Rp.000 per sq m per month) . . . . . . . . . . . . . . . . . . . . . . . NPI for Forecast Period 2007, Projection Year 2008 and Projection Year 2009 (S$000) . . . . . . . . . . . . . .

200

Forecast Period 20074,233 Projection Year 20088,895 Projection Year 20098,943

Percentage of contribution to LMIR Trusts Gross Rent for Forecast Period 2007 . . . . . . . . . . . . . . . . . . . . . . . . . 11.2% Note: (1) The figure comprises the number of households within the primary trade area of the relevant Retail Mall. (See Appendix FIndependent Report on the Indonesian Retail Property Market.)

142

Business and properties THE PLAZA SEMANGGI Jalan Jend. Sudirman Kav.50, South Jakarta

Jakarta profile (See Gajah Mada PlazaJakarta Profile.) Description The Plaza Semanggi is a modern shopping centre comprising seven storey and two basement levels shopping centre and 13 levels of office floors, with a carpark comprising approximately 1,100 parking lots. The Plaza Semanggi is strategically located in the heart of Jakartas CBD within the citys Golden Triangle at the Semanggi interchange, which is a junction channelling north-south and east-west traffic across central Jakarta. The centre is situated among many commercial buildings and adjacent to Atmajaya University, one of Jakartas most prominent universities. Anchored by Centro Department Store and Giant Hypermarket, the 479 tenants (as at 30 June 2007) provide all categories of shoppers with a diverse and comprehensive tenant mix. The Plaza Semanggi offers both destination and convenience shopping, and is supported by its central location, which is easily accessible by cars and public transport. Tenant profile As at 30 June 2007, The Plaza Semanggi had 479 retail tenants based on Committed Leases. The mall is anchored by the only Centro Department Store located in Jakarta. This Centro Department Store occupies three levels, namely the upper ground level, level one and level two, with Fitness First also occupying space across these three levels. The lower ground floor is occupied by Giant Hypermarket. The ground floor includes a significant number of retailers selling F&B, retail services, gifts, and health and beauty products. The upper ground floor contains a number of international fashion retailers to complement the department store and to cater for middle to upper middle income visitors. High profile tenants on the upper ground level
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Business and properties include Planet Surf, Giordano, Adidas, Da Vinci jewellery, Starbucks, Bread Talk and a number of optical retailers. The first floor mainly comprises fashion retailers selling accessories and shoes. The second level focuses on mobile phones, electronics and computers. The third level is dominated by household wares and furniture retailers. Duck King, a popular local restaurant, is also on the third level. Level 3A houses a traditional food court with small hawker style retailers and a restaurant precinct. The cinema complex is located on the fifth level. As at 30 June 2007, the average monthly rental rate of specialty stores in The Plaza Semanggi is approximately Rp. 119,000 per sq m. Asset enhancement plans Current asset enhancement plans include a new alfresco caf area called Plangi on the Sky which will increase the existing NLA by an estimated 3,000 sq m. Other asset enhancement plans include the continued upgrade of the tenancy mix to introduce the most current and innovative retailers to cater to the multi-dimensional customer profile. The following chart provides a breakdown (by area) of the various trade sub-sectors represented in The Plaza Semanggi as at 30 June 2007: The Plaza SemanggiTrade sector analysis (By area)

Trade sub sector

Department Store Food & Beverage/Food Court Leisure & Entertainment Supermarket/Hypermarket Electronic/IT Home Furnishings Fashion Sports & Fitness Other Books & Stationery Services Jewelry Hobbies Gifts & Specialty Optic

Contribution (%)
16.4 16.0 13.2 13.0 12.4 7.1 5.5 4.4 4.3 3.8 1.2 0.9 0.7 0.7 0.4

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Business and properties The table below sets out information on the 10 largest tenants of The Plaza Semanggi based on Committed Leases as at 30 June 2007:
Percentage of the total base rental income of The Plaza Semanggi based on Committed Leases as at 30 June 2007 (%)

Tenant

Business sector

Lease expiry date

Percentage of total NLA (%)

Centro Department Store. . . . . . . . . . . . Giant Hypermarket . . . Electronic Solution Indonesia . . . . . . . . . . Fitness First . . . . . . . . X Lounge . . . . . . . . . . Gramedia . . . . . . . . . . 3 Store . . . . . . . . . . . . Duck King. . . . . . . . . . Gillians Billiard . . . . . . Game Master . . . . . . .

Department Store . . . . . . . . . .

4 November 2013

13.3 10.6 7.2 3.6 3.2 3.0 0.3 0.6 1.7 1.4 44.8(1) 55.2 100.0

8.6 5.6 5.0 2.5 2.4 1.8 1.7 1.5 1.5 1.0 31.6 68.4 100.0

Supermarket/Hypermarket 14 February 2019 Electronics Sports & Fitness Entertainment & Leisure Bookstore & Stationery Electronic/IT F&B Entertainment & Leisure Entertainment & Leisure 31 17 30 30 29 31 19 28 October 2011 May 2020 November 2009 November 2010 February 2012 July 2009 July 2009 February 2015

10 largest tenants . . . . . Other tenants . . . . . . . . Total . . . . . . . . . . . . . .

Note: (1) Due to rounding differences. Expiry Profile The following table sets out the expiry profiles of the tenancies(1) at The Plaza Semanggi as at 30 June 2007:
Monthly gross rent of expiring leases as a percentage of forecast rental income (%)

Period

Total number of leases expiring

NLA of expiring leases (sq m)

Expiring leases as a percentage of NLA as at 30 June 2007 (%)

FY2007 . . . . . . . FY2008 . . . . . . . FY2009 . . . . . . . Beyond FY2009 . Vacant . . . . . . . .

. . . . .

. . . . .

. . . . .

. . . . .

. . . . .

. . . . .

. . . . .

. . . . .

. . . . .

15 57 113 294 479

1,346 5,813 9,334 40,084 2,106 58,685(2)

4.3 13.6 30.1 49.0 3.0 100.0

2.3 9.9 15.9 68.3 3.6 100.0

Total . . . . . . . . . . . . . . . . . . Notes: (1) Includes office leases. (2) Due to rounding differences. Competition

Existing: The Plaza Semanggi, located in the heart of Jakartas CBD, currently faces competition from a number of retail malls in the immediate trade area. There are 12 competing malls, each with a NLA in excess of 20,000 sq m, and located within a 10 km radius from The Plaza Semanggi. Some of these competing retail malls are anchored by international retailers such as Sogo Department Store, Giant
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Business and properties Hypermarket, Galleria, Zara, Watsons Personal Care Store, Metro department store, Nichols Edwards, and local retailers such as Hero Supermarket and Matahari Department Store. Many of these retail malls compete for the same target segment as The Plaza Semanggi and may potentially impact the sales growth that can be achieved at The Plaza Semanggi. The largest competing retail malls within a six-km radius are: Pondok Indah Mall, situated six km to the southwest of The Plaza Semanggi, with a NLA of approximately 100,000 sq m, and is anchored by Giant Hypermarket, Sogo and Metro department stores, Zara and Studio 21 Cinema. Mal Taman Anggrek, situated five km to the northwest of The Plaza Semanggi, with a NLA of approximately 97,000 sq m, with a tenant profile including Metro and Galleria department stores as well as Hero Supermarket. Plaza Senayan and the recently opened Senayan City, situated just two km to the southwest of The Plaza Semanggi, with an aggregate NLA of approximately 80,000 sq m. Both retail malls target shoppers in the middle to upper income segment, with Plaza Senayan focusing on a slightly more affluent target segment. Mal Ciputra, situated six km north of The Plaza Semanggi, with a NLA of 51,000 sq m, and anchored by Batik Keris, Matahari and Hero Supermarket. Plaza Indonesia, situated three km north of The Plaza Semanggi, with a NLA of approximately 42,000 sq m, is a high-end retail mall targeting the upper income shopper segment which comprises mainly high-end retailers, including a Debenhams department store. Jakarta City, situated three km north of The Plaza Semanggi, is a strata mall anchored by a Hypermart but does not house a department store. Future: The competitive environment of The Plaza Semanggis trade area is expected to intensify over the next five years, with the planned development of a number of new competing retail malls. There are a number of new retail projects currently under construction which will target the middle income households within The Plaza Semanggis population catchment. These developments will add an aggregate NLA of 318,900 sq m to Jakartas CBD and are scheduled to be completed by the end of 2009. These developments include: Pacific Place, located one km from The Plaza Semanggi, with a NLA of approximately 75,000 sq m, and will be anchored by Metro department store and Kidzania. Grand Indonesia, located three km away from The Plaza Semanggi, with a NLA of approximately 108,000 sq m, and will be anchored by Seibu, Harvey Nichols and Blitz Megaplex (a cinema operator). Citywalk Sudirman @ Cityloft, located two km away from The Plaza Semanggi, with a NLA of approximately 17,300 sq m. Main Street Gandaria, located five km away from The Plaza Semanggi, with a NLA of approximately 94,000 sq m, and will be anchored by Metro department store, Fitness First, Studio and Electronic Solutions. Plaza Indonesia extension, which will increase its current NLA of 42,000 sq m by an additional 25,386 sq m. Kota Kasablanca, located three km away from The Plaza Semanggi, with a NLA of approximately 62,000 sq m and anchored by Sogo department store and Fitness First. Kemang City Mall, located five km away from The Plaza Semanggi, with a NLA of approximately 56,052 sq m. Sudirman Place, located one km away from The Plaza Semanggi, with a NLA of approximately 31,000 sq m.
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Business and properties Epicentrum Walk, located two km away from The Plaza Semanggi, with a NLA of approximately 26,200 sq m. (See Appendix FIndependent Report on the Indonesian Retail Property Market.) Other information The following table sets out other relevant information relating to The Plaza Semanggi. Year of building completion . . . . . . . . Land Area . . . . . . . . . . . . . . . . . . . . . GFA as at 30 June 2007 . . . . . . . . . . NLA as at 30 June 2007 . . . . . . . . . . Occupancy rate as at 30 June 2007. . Appraised value by Knight Frank as at 30 June 2007 . . . . . . . . . . . . . . . . . . Appraised value by Colliers as at 30 June 2007 . . . . . . . . . . . . . . . . . . Car parking lots . . . . . . . . . . . . . . . . . Motorcycle parking lots . . . . . . . . . . . Population catchment . . . . . . . . . . . . Title . . . . . . . . . . . . . . . . . . . . . . . . . . 2003 19,000 sq m 91,232 sq m 58,685 sq m(1) 96.4% S$214.8 million S$211.1 million 1,100 750 270,387 households(2) The Plaza Semanggi was built pursuant to a BOT Scheme based on the Introductory agreement of revitalisation, management and transfer (Perjanjian Pengikatan Revitalisasi, Pengelolaan dan Pengalihan) dated 5 January 2000 between Yayasan Gedung Veteran Republik Indonesia as BOT Grantor and PT Primatama Nusa Indah as BOT Grantee, as confirmed by deed of revitalisation, development, management and transfer (Perjanjian Revitalisasi, Pembangunan, Pengolahan dan Pengalihan) No. 56 dated 29 March 2000 and as amended by deeds of addendum Nos. 25 and 26, both dated 26 May 2000, made before Popie Savitri M Pharmanto S.H., Notary in Jakarta and Addendum dated 29 January 2002. Yayasan Gedung Veteran Republik Indonesia was given a permit to use a plot of land and buildings in an area of 19,000 sq m located at Kecamatan Setiabudi, Karet Semanggi, DKI Jakarta (known as Jalan Jend Sudirman Kav. 50 RT 002/RW01), With Right to Use (Hak PakaiHP) Title No. 133 by State Secretary of the Republic of Indonesia as the land owner. Yayasan Gedung Veteran Republik Indonesia and PT Primatama Nusa Indah have agreed to enter into a BOT Scheme to construct a shopping centre and an office building. HP Title no. 133/Karet Semanggi is registered under the name of State Secretary of the Republic of Indonesia and will be valid as long as the land is being used. This BOT agreement is valid for 30 years from 8 July 2004. PT Primatama Nusa Indah, with consent from Yayasan Gedung Veteran Republik Indonesia (as BOT Grantor) and the State Secretariat of the Republic of Indonesia, may assign its rights and obligations under the BOT agreement to other parties or bank or financial institutions that finance new construction, provided that the BOT agreement shall bind the transferee.
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Business and properties Instead of the transfer of the right of the BOT Agreement, which requires consent from the BOT Grantor, the transfer of the interest of the BOT agreement may also be conducted through transfer of shares of the shareholders of PT Primatama Nusa Indah. The BOT Agreement does not prohibit the transfer of shares by the shareholders of PT Primatama Nusa Indah. Since PT Primatama Nusa Indah does not own the land on which The Plaza Semanggi is situated, it cannot transfer or encumber the land. Average Specialty Base Rent as at 30 June 2007 (Rp.000 per sq m per month) . . . . . . . . . . . . . . . . . . . . . . . NPI for Forecast Period 2007, Projection Year 2008 and Projection Year 2009 (S$000) . . . . . . . . . . . . . .

119

Forecast Period 20078,572 Projection Year 200817,356 Projection Year 200918,274

Percentage of contribution to LMIR Trusts Gross Rent for Forecast Period 2007 . . . . . . . . . . . . . . . . . . . . . . . . . 20.4% Notes: (1) Current ongoing asset enhancement works to include a new alfresco caf area called the Plangi on the Sky caf will increase NLA by an estimated 3,000 sq m, bringing total NLA to approximately 61,685 sq m by the end of 2007. (2) The figure comprises the number of households within the primary trade area of the relevant Retail Mall. (See Appendix FIndependent Report on the Indonesian Retail Property Market.)

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Business and properties MAL LIPPO CIKARANG Jalan MH Thamrin, Lippo Cikarang, Greater Jakarta

Jakarta profile (See Gajah Mada PlazaJakarta Profile.) Description Mal Lippo Cikarang is a two-level retail mall located within the Lippo Cikarang estate. The estate is approximately 40 km east of Jakarta and is connected to Jakarta via the Jakarta-Cilkampek toll road. Comprising industrial, commercial and residential components, the Lippo Cikarang estate is home to 25,000 residents and approximately 65,000 jobs. Mal Lippo Cikarang is the main shopping centre in the estate and has limited competition within an approximately 10-km radius. The mall is anchored by Matahari Department Store, Hypermart and Hero Supermarket, complemented by a cinema, a bookshop, a video game centre, restaurants and dining outlets. The mall has recently completed a S$4.7 million expansion and renovation program which has increased its NLA by more than 50%. Tenant profile As at 30 June 2007, Mal Lippo Cikarang has 116 retail tenants based on Committed Leases. The mall is anchored by Matahari Department Store, Hypermart, Hero Supermarket and Studio 21 Cinema which collectively occupy approximately 55.0% of the malls NLA, and is well complemented by a diverse set of specialty tenants from a wide variety of industries. The prominent specialty tenants include Nokia, Timezone, Toko Buku Utama bookstore, Kentucky Fried Chicken, Wendys Restaurant, Pizza Hut, The Executive, Dunkin Donuts and Johnny Andrean Salon. The mall has achieved an occupancy rate of 96.3% as at 30 June 2007. With the completion of the extension for Hypermart, the three anchor tenants, Matahari Marketplace supermarket and Matahari Department Store, Hero Supermarket and Hypermart will account for over 66% of the NLA of Mal Lippo Cikarang, which will provide stable and long-term rental income and attract
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Business and properties shoppers to the mall. The leases of 51 existing tenants expire in 2007 and this will present opportunities to review the tenancy mix and potentially achieve higher rentals for the expiring leases. Asset enhancement plans Construction of an extension annex, which increased the malls NLA by 10,694 sq m, has recently been completed. As at 30 June 2007, 8,539 sq m or approximately 79.8% of this additional NLA space created has been pre-committed to Hypermart. The remaining additional NLA will be leased out to specialty tenants. The following chart provides a breakdown (by area) of the various trade sub-sectors represented in Mal Lippo Cikarang as at 30 June 2007: Mal Lippo CikarangTrade sector analysis (By area)

Trade sub sector

Contribution (%)

Department Store Supermarket/Hypermarket Leisure & Entertainment Food & Beverage/Food Court Fashion Home Furnishings Books & Stationery Services Electronic/IT Other Toys Sports & Fitness Gifts & Specialty

23.7 21.3 14.0 12.1 12.1 5.4 3.7 2.9 1.5 1.2 0.8 0.7 0.6

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Business and properties The table below sets out information on the 10 largest tenants of Mal Lippo Cikarang based on Committed Leases as at 30 June 2007:
Percentage of the total base rental income of Mal Lippo Cikarang based on Committed Leases as at 30 June 2007 (%)

Tenant

Business sector

Lease expiry date

Percentage of total NLA (%)

Matahari Department Store . . . . . . . . . . . . Hero supermarket . . . . Studio 21 Cinema. . . . . Solaria . . . . . . . . . . . . Kentucky Fried Chicken . . . . . . . . . . Toko Buku Utama . . . . . Sting . . . . . . . . . . . . . . Wendys Restaurant . . . Hoka-Hoka Bento . . . . . TimeZone . . . . . . . . . .

. Department store 9 December 2026 . Supermarket/Hypermarket 9 August 2008 . Leisure & Entertainment 16 February 2015 . F&B 16 May 2012 . . . . . . F&B Bookstore Furniture F&B F&B Leisure & Entertainment 9 June 2010 31 August 2007 31 January 2012 14 March 2012 22 August 2007 30 September 2011

33.4 12.5 9.4 2.8 1.1 3.4 1.1 1.5 1.4 3.8 70.3(1) 29.7 100.0

18.0 11.8 4.2 4.1 3.1 3.1 2.8 2.4 2.2 1.9 53.5(1) 46.5 100.0

10 largest tenants. . . . . . Other tenants. . . . . . . . . Total . . . . . . . . . . . . . . .

Note: (1) Due to rounding differences.

Expiry Profile The following table sets out the expiry profiles of the tenancies at Mal Lippo Cikarang as at 30 June 2007:
Monthly gross rent of expiring leases as a percentage of forecast rental income (%)

Period

Total number of leases expiring

NLA of expiring leases (sq m)

Expiring leases as a percentage of NLA as at 30 June 2007 (%)

FY2007 . . . . . . . FY2008 . . . . . . . FY2009 . . . . . . . Beyond FY2009. Vacant . . . . . . . . Total . . . . . . . . . Note: (1)

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

51 29 11 25 116

2,187 3,589 342 11,195 661 17,974

14.7 27.9 5.9 46.2 5.3 100.0

12.2 20.0 1.9 62.3 3.7 100.0(1)

Due to rounding differences.

Competition Existing: Mal Lippo Cikarang is the only major shopping centre serving the Lippo Cikarang Township. Competing retail malls within a 10 km radius and each comprising an estimated NLA of at least 8,000 sq m include: Mal Carrefour Cikarang, which began operations in early 2007, is located four km away from Mal Lippo Cikarang, with a NLA of approximately 8,000 sq m, and is anchored by Carrefour hypermarket. The mall
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Business and properties mainly focuses on providing day-to-day necessities and groceries, with limited F&B and product offerings. SGC Cikarang, a strata mall located nine km to the north of Mal Lippo Cikarang, with a NLA of approximately 29,150 sq m, and is anchored by Ramayana hypermarket. Cikarang Trade Centre, a strata mall located two km north of Mal Lippo Cikarang, with a NLA of 10,000 sq m. The mall does not have an anchor tenant and targets the low to middle income segment of shoppers. Future: Appendix FIndependent Report on the Indonesian Retail Property Market indicates that, at present, there are no known proposals for new centres that may compete directly with Mal Lippo Cikarang. However, given the relative strength of retail supply in recent years, it is possible that such competing centres will be developed in the future. (See Appendix FIndependent Report on the Indonesian Retail Property Market.) Other information The following table sets out other relevant information relating to Mal Lippo Cikarang. Year of building completion . . . . . . . . Land Area . . . . . . . . . . . . . . . . . . . . . GFA as at 30 June 2007 . . . . . . . . . . NLA as at 30 June 2007 . . . . . . . . . . Occupancy rate as at 30 June 2007. . Appraised value by Knight Frank as at 30 June 2007 . . . . . . . . . . . . . . . . . . Appraised value by Colliers as at 30 June 2007 . . . . . . . . . . . . . . . . . . Car parking lots . . . . . . . . . . . . . . . . . Motorcycle parking lots . . . . . . . . . . . Population catchment . . . . . . . . . . . . Title . . . . . . . . . . . . . . . . . . . . . . . . . . 1995 49,250 sq m 25,767 sq m 17,974 sq m(1) 96.3% S$80.2 million S$79.7 million 513 950 84,962 households(2) Mal Lippo Cikarang was built on a plot of land of 49,250 sq m based on Measurement Letter No. 19128/1994 dated 25 August 1994 and Certificate of Right to Build (HGB title) No. 627/ Kelurahan Cibatu, registered under the name of PT Graha Nusa Raya, issued by Bekasi Land Office on 9 December 1994, and valid until 5 May 2023 and is extendable for another term of up to 20 years. Following expiration of this additional term, a renewal application may be made. (See Overview of the Relevant Laws and Regulations in IndonesiaRights to Own and/or to UseHak Guna Bangunan (HGB/Right to Build).)

Average Specialty Base Rent as at 30 June 2007 (Rp.000 per sq m per month) . . . . . . . . . . . . . . . . . . . . . . . NPI for Forecast Period 2007, Projection Year 2008 and Projection Year 2009 (S$000) . . . . . . . . . . . . . .

105

Forecast Period 20072,589 Projection Year 20085,548 Projection Year 20095,729

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Business and properties Percentage of contribution to LMIR Trusts Gross Rent for Forecast Period 2007 . . . . . . . . . . . . . . . . . . . . . . . . . 6.8% Notes: (1) (2) Recently completed asset enhancement works to expand the retail space at Mal Lippo Cikarang have increased the NLA by 10,694 sq m, bringing the total NLA to 28,668 sq m. The figure comprises the number of households within the primary trade area of the relevant Retail Mall. (See Appendix FIndependent Report on the Indonesian Retail Property Market.)

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Business and properties EKALOKASARI PLAZA Jalan Siliwangi 123, Bogor, Greater Jakarta

Bogor profile Bogor, a city in West Java, has a total population of approximately of 3.0 million, made up of approximately 0.9 million in the town area and 2.0 million in the suburban areas. From 2000 to 2004, the citys population grew annually at 3.9%. The city is on the main road from Jakarta to Bandung, over the Puncak pass. It is also a popular weekend getaway for families from Jakarta. Description Ekalokasari Plaza is a six storey with three basement levels retail mall with a carpark comprising 390 parking lots. The mall is located approximately two km south east of the Bogor City Centre on a major road, Jalan Siliwangi, and approximately 3.5 km south or five minutes drive from the Bogor exit of the Jagorawi toll road which connects Jakarta to Bogor. Bogor is approximately 50 km south of Jakarta and had a population of approximately 855,000 as at 2002. Ekalokasari Plaza is positioned as the retail mall of convenience and choice for its population catchment and provides a comprehensive retail mix anchored by Matahari Department Store, Foodmart supermarket, two large bookstores and a concentration of fashion labels and outlets. Ekalokasari Plaza has recently completed a S$2.0 million expansion and renovation programme for the third and mezzanine floors. The new expanded area will house a food court and is also intended to include a fitness centre and a cinema. Tenant profile As at 30 June 2007, Ekalokasari Plaza has 107 retail tenants based on Committed Leases. The tenant profile of the mall comprises a diverse set of tenants. There are 107 specialty stores to cater to family shoppers, with products and services ranging from fashion to music. The mall is anchored by Matahari Department Store and Foodmart supermarket which account for 21.6% of monthly Gross Rent. The anchor tenants, together with the Timezone amusement centre, occupy the lower ground to the second
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Business and properties floor. The other prominent tenants include Karisma bookstore, Gramedia bookstore, Number 61, Botanical Food Court, Kentucky Fried Chicken and Popeye restaurant. As at 30 June 2007, the occupancy rate of the mall was 87.3% of the total existing NLA of 20,587 sq m. Asset enhancement plans The mall has recently completed asset enhancement works for the third floor and mezzanine level which have increased the NLA by 5,013 sq m, bringing the total NLA to 25,600 sq m. This development will incorporate a new food court and potentially, a fitness centre and a cinema which will anchor the top levels of the centre, giving the advantage of increasing traffic through all levels of the centre. The following chart provides a breakdown (by area) of the various trade sub-sectors represented in Ekalokasari Plaza as at 30 June 2007: Ekalokasari PlazaTrade sector analysis (By area)

Trade sub sector Department Store Supermarket/Hypermarket

Fashion

Contribution (%) 40.4 13.4 12.1 11.8 8.0 6.1 2.8 2.1 1.1 0.9 0.5 0.4 0.2 0.2

Books & Stationery Food & Beverage/Food Court Leisure & Entertainment Services Other Hobbies Gifts & Specialty Toys Home Furnishings Sports & Fitness Electronic/IT

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Business and properties The table below sets out information on the 10 largest tenants of Ekalokasari Plaza based on Committed Leases as at 30 June 2007:
Percentage of the total base rental income of Ekalokasari Plaza based on Committed Leases as at 30 June 2007 (%)

Tenant

Business sector

Lease expiry date

Percentage of total NLA (%)

Matahari Department Store/ Matahari Marketplace supermarket . . . . . . . . . . Gramedia bookstore . . . Karisma . . . . . . . . . . . . Number 61 . . . . . . . . . . Kentucky Fried Chicken . Popeye restaurant . . . . . Es Teler 77 . . . . . . . . . . Bata. . . . . . . . . . . . . . . Steak 21 . . . . . . . . . . . Duta Suara . . . . . . . . . . .. .. .. .. .. .. .. .. .. . . . . . . . . .

Department Store/ Supermarket Books & Stationery Books & Stationery Fashion F&B F&B F&B Fashion F&B Hobbies

23 March 2015 22 29 11 12 18 30 12 20 05 May 2014 February 2024 December 2008 December 2023 December 2013 April 2009 March 2009 June 2010 March 2009

48.2 5.9 4.7 1.3 2.1 1.5 0.6 0.5 0.7 0.5 66.1(1) 33.9 100.0

21.6 5.4 4.0 3.6 3.0 2.9 2.2 1.8 1.7 1.7 48.0(1) 52.0 100.0

10 largest tenants . . . . . . . . Other tenants . . . . . . . . . . . Total . . . . . . . . . . . . . . . . .

Note: (1) Due to rounding differences.

Expiry profile The following table sets out the expiry profiles of the tenancies at Ekalokasari Plaza as at 30 June 2007:
Monthly Gross Rent of expiring leases as a percentage of forecast rental income (%)

Period

Total number of leases expiring

NLA of expiring leases (sq m)

Expiring leases as a percentage of NLA as at 30 June 2007 (%)

FY2007 . . . . . . . FY2008 . . . . . . . FY2009 . . . . . . . Beyond FY2009 Vacant . . . . . . .

. . . . .

. . . . .

. . . . .

. . . . .

. . . . .

. . . . .

. . . . .

. . . . .

. . . . .

. . . . .

. . . . .

. . . . .

. . . . .

. . . . .

13 15 33 46 107

256 1,186 1,683 14,838 2,624 20,587

2.9 8.8 16.7 31.8 39.8 100.0

1.2 5.8 8.2 72.1 12.7 100.0

Total . . . . . . . . . . . . . . . . . . . . . . .

Competition Existing: Ekalokasari Plaza currently faces competition within a 10-km radius from seven retail malls with an aggregate NLA of 192,300 sq m. The competing retail malls within a six-km radius include: Botani Square, which commenced operations in late 2006, is located two km northwest of Ekalokasari Plaza. It has a NLA of approximately 30,000 sq m and is anchored by Giant Hypermarket and a small Rimo Department Store.
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Business and properties Pangrango Plaza, a strata mall located three km northwest of Ekalokasari Plaza, with a NLA of 30,000 sq m, is anchored by Sarinah department store, Toka Bookstore and occupied by a large number of strata units. The mall targets the low to middle income market. Bogor Trade Mall, a strata mall located four km west of Ekalokasari Plaza, with a NLA of 45,000 sq m, is anchored by Ramayana department store. Plaza Jambu Dua, located seven km north of Ekalokasari Plaza, with a NLA of 20,800 sq m, is anchored by Ramayana department store. Plaza Bogor, located three km west of Ekalokasari Plaza, with a NLA of 27,500 sq m, is anchored by Robinsons department store. Future: Future competition will come from the proposed extension to Botani Square as mentioned above. Apart from this, Appendix FIndependent Report on the Indonesian Retail Property Market indicates that, at present, there are no known proposals for new centres to compete directly with Ekalokasari Plaza. However, given the relative strength of retail supply in recent years, it is possible that competing centres will be developed in the future. (See Appendix FIndependent Report on the Indonesian Retail Property Market.) Other information The following table sets out other relevant information relating to Ekalokasari Plaza. Year of building completion . . . . . . . . Land Area . . . . . . . . . . . . . . . . . . . . . GFA as at 30 June 2007 . . . . . . . . . . NLA as at 30 June 2007 . . . . . . . . . . Occupancy rate as at 30 June 2007. . Appraised value by Knight Frank as at 30 June 2007 . . . . . . . . . . . . . . . . . . Appraised value by Colliers as at 30 June 2007 . . . . . . . . . . . . . . . . . . Car parking lots . . . . . . . . . . . . . . . . . Motorcycle parking lots . . . . . . . . . . . Population catchment . . . . . . . . . . . . Title . . . . . . . . . . . . . . . . . . . . . . . . . . 2003 10,500 sq m 39,895 sq m 20,587 sq m(1) 87.3% S$66.0 million S$68.1 million 390 382 144,451 households(2) Ekalokasari Plaza is owned by PT Indah Pesona Bogor and was built pursuant to a BOT Scheme based on the Cooperation Agreement (Perjanjian Kerjasama) between IPB represented by PT Bogor Life Science and Technology as BOT Grantor and PT IPB as BOT Grantee, as stipulated under Deed No. 133 dated 27 June 2001, made before Natalia Lini Handayani S.H., Notary in Bogor and amended by Addendum dated 9 February 2004, Notary in Bogor, as amended by Deed of Amendment Agreement No. 7 dated 25 April 2007, drawn up before Dindin Saepudin, SH, Notary in Bandung. Pursuant to this BOT Agreement, IPB grants to PT IPB a plot of land with HP Title No. 1/Sukasari, an area of approximately 10,500 sq m, located at JI Siliwangi No. 123, Bogor, registered under the ame of the Department of Education and Culture (Departemen Pendidikan dan Kebudayaan) c.q IPB, which will be valid as long as the land is being used. The operating period
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Business and properties of the BOT Scheme of Ekalokasari Plaza is from 27 June 2001 through 27 June 2032. If PT IPB (as BOT Grantee) wants to assign its rights under the BOT Agreement, PT IPB must submit written notification to PT Bogor Life Science and Technology (as BOT Grantor). Instead of the transfer of the right of the BOT Agreement, which requires the consent of the BOT Grantor, the transfer of the interest of the BOT agreement may also be conducted through transfer of shares of the shareholders of PT IPB. The BOT Agreement does not prohibit the transfer of shares by the shareholders of PT IPB. As PT IPB is not the owner of the land on which Ekaloksari Plaza is situated on, PT IPB has no right to assign or encumber the land. Average Specialty Base Rent as at 30 June 2007 (Rp.000 per sq m per month) . . . . . . . . . . . . . . . . . . . . . . . NPI for Forecast Period 2007, Projection Year 2008 and Projection Year 2009 (S$000) . . . . . . . . . . . . . .

141

Forecast Period 20072,296 Projection Year 20085,798 Projection Year 20097,503

Percentage of contribution to LMIR Trusts Gross Rent for Forecast Period 2007 . . . . . . . . . . . . . . . . . . . . . . . . . 5.8% Notes: (1) (2) Recently completed asset enhancement works for the third floor and mezzanine have increased the NLA by 5,013 sq m, bringing the total NLA to 25,600 sq m. The figure comprises the number of households within the primary trade area of the relevant Retail Mall. (See Appendix FIndependent Report on the Indonesian Retail Property Market.)

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Business and properties BANDUNG INDAH PLAZA Jalan Merdeka No. 56, Bandung, West Java

Bandung profile (See Istana PlazaBandung Profile.) Description Bandung Indah Plaza is a four storey with three basement levels retail mall with a carpark comprising 602 parking lots. It is located strategically in the heart of the CBD of Bandung, the fourth most populous city in Indonesia. The retail mall is easily accessible from Jalan Merdeka, a major road which connects North Bandung to South Bandung, and is surrounded by commercial buildings and middle to upper income residential areas. It is also attached to Hyatt Regency Hotel, one of the leading five-star hotels in Bandung. Bandung Indah Plaza is anchored by Matahari Department Store, Hypermart, Yogya Supermarket, a bookstore, a cinema and supported by a list of international and local tenants. It has recently completed a S$12.6 million expansion and renovation programme. Tenant profile As at 30 June 2007, Bandung Indah Plaza has 180 retail tenants based on Committed Leases. The mall provides a one-stop shopping destination with a comprehensive tenant mix of everyday convenience retailers. The mall is well positioned to cater to the youth market, which has strong demand in central Bandung due to the student population from nearby universities. The ground floor of the mall is anchored by Hypermart, which accounts for 16.9% of total NLA. This level also includes F&B outlets such as McDonalds and Starbucks, and fashion and accessories retailers such as Quiksilver and Giordano. The first level of the mall is anchored by Matahari Department Store, which accounts for 22.8% of total NLA. Youth fashion retailers such as City Surf and Levis are also well represented.
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Business and properties The second level of the mall is anchored by Matahari Department Store and Toko Gunung Agung bookstore. Lifestyle retailers include Extreme Store and MG Music. Yogya Supermarket anchors the southern end of this level. The third level of the mall comprises Studio 21 Cinema (which has six screens), Timezone and a new food court. As at 30 June 2007, the average monthly rental rate of specialty stores is approximately Rp. 274,000 per sq m. Asset enhancement plans The mall has recently completed asset enhancement works which have increased NLA by 3,843 sq m. These asset enhancement initiatives have added another 50 parking lots to the basement carpark; relocate existing tenants to create new lease units in accordance with the new building lay out arrangement; improved the mall appearance through more colourful and attractive lighting; and improved the mall directory with an elegant and trendy design. The following chart provides a breakdown (by area) of the various trade sub-sectors represented in Bandung Indah Plaza as at 30 June 2007: Bandung Indah PlazaTrade sector analysis (By area)

Trade sub sector Department Store Supermarket/Hypermarket Other Food & Beverage/Food Court Leisure & Entertainment Fashion Sports & Fitness Books & Stationery Services Hobbies Gifts & Specialty Toys Home Furnishings Education/School Electronic/IT

Contribution (%) 20.7 15.4 12.6 11.9 11.3 10.3 5.5 3.2 2.3 2.2 1.8 1.3 0.7 0.6 0.2

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Business and properties The table below sets out information on the 10 largest tenants of Bandung Indah Plaza based on Committed Leases as at 30 June 2007:
Percentage of the total base rental income of Bandung Indah Plaza based on Committed Leases as at 30 June 2007 (%)

Tenant

Business sector

Lease expiry date

Percentage of total NLA (%)

Matahari Department Store . . . . . . . . . . Hypermart . . . . . . . . Toko Buku Gunung Agung . . . . . . . . . McDonalds . . . . . . . Rice Bowl . . . . . . . . Extreme Store . . . . . Felice. . . . . . . . . . . . Studio 21 Cinema . . . Texas Chicken . . . . . Timezone . . . . . . . . . 10 largest tenants . . . Other tenants . . . . . . Total . . . . . . . . . . . .

Department Store Supermarket/Hypermarket Books & Stationery F&B F&B Fashion Fashion Leisure & Entertainment F&B Leisure & Entertainment

31 May 2015 31 May 2015 23 May 2011 16 November 2009 29 June 2011 15 September 2011 16 March 2011 31 December 2015 4 Aug 2013 31 May 2015

22.8 16.9 3.5 2.2 0.8 1.2 0.4 6.8 1.1 2.1 57.8 42.2 100.0

11.6 6.5 3.9 2.4 2.2 2.2 1.9 1.6 1.4 1.4 35.0(1) 65.0 100.0

(1)

Due to rounding differences

Expiry profile The following table sets out the expiry profiles of the tenancies at Bandung Indah Plaza as at 30 June 2007:
Monthly gross rent of expiring leases as a percentage of forecast rental income (%)

Period

Total number of leases expiring

NLA of expiring leases (sq m)

Expiring leases as a percentage of NLA as at 30 June 2007 (%)

FY2007 . . . . . . . FY2008 . . . . . . . FY2009 . . . . . . . Beyond FY2009 . Vacant . . . . . . . .

. . . . .

. . . . .

. . . . .

. . . . .

. . . . .

. . . . .

. . . . .

. . . . .

. . . . .

3 7 5 165 180

157 208 221 21,430 4,456 26,472

0.2 1.3 1.0 69.1 28.4 100.0

0.6 0.8 0.8 81.0 16.8 100.0

Total . . . . . . . . . . . . . . . . . . Competition

Existing: Bandung Indah Plaza currently faces competition within its trade area from five competing retail malls, each located within a five km radius from Bandung Indah Plaza, and comprising an aggregate NLA of approximately 145,000 sq m, being Bandung Supermall, Riau Junction, Cihampelas Walk, Paris Van Java and Istana Plaza (one of the Retail Malls). Among these competing retail malls, Riau Junction and Paris Van Java are new malls which commenced operations in the first half of 2007. Bandung Supermall, located four km southeast of Bandung Indah Plaza, with a NLA of 48,800 sq m, is anchored by Metro department store and Giant Hypermarket. The mall targets the upper income retail segment in Bandung and has a strong entertainment offering, including a cinema, a bowling centre and a video games centre.
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Business and properties Paris Van Java, located four km northwest of Bandung Indah Plaza, with a NLA of 38,000 sq m, is anchored by Sogo Department Store, Carrefour hypermarket and Blitz Megaplex Cinemas. The mall commenced its operations in 2006, and is still in process of leasing its retail space. Its retail offering and competitive position may improve once all of its tenancies are occupied and completed. Istana Plaza, which is located two km from Bandung Indah Plaza, and is one of the Retail Malls in LMIR Trusts initial property portfolio. Cihampelas Walk, located two km away from Bandung Indah Plaza, with a NLA of 28,400 sq m, is anchored by Yogya Supermarket and department store. Riau Junction, located less than one km away from Bandung Indah Plaza, with a NLA of 6,400 sq m, is anchored by Yogya Supermarket and department store with a number of food retailers on its third level. With its relative small size and limited offering, the mall mainly offers daily necessity shopping to shoppers. Future: Appendix FIndependent Report on the Indonesian Retail Property Market indicates that, at present, there are no known proposals for new centres to compete directly with Bandung Indah Plaza. However, given the relative strength of retail supply in recent years, particularly in Greater Jakarta, it is possible that future centres will be developed in Bandung. (See Appendix FIndependent Report on the Indonesian Retail Property Market.) Other information The following table sets out other relevant information relating to Bandung Indah Plaza. Year of building completion . . . . . . . . Land Area . . . . . . . . . . . . . . . . . . . . . GFA as at 30 June 2007 . . . . . . . . . . NLA as at 30 June 2007 . . . . . . . . . . Occupancy rate as at 30 June 2007. . Appraised value by Knight Frank as at 30 June 2007 . . . . . . . . . . . . . . . . . . Appraised value by Colliers as at 30 June 2007 . . . . . . . . . . . . . . . . . . Car parking lots . . . . . . . . . . . . . . . . . Motorcycle parking lots . . . . . . . . . . . Population catchment . . . . . . . . . . . . Title . . . . . . . . . . . . . . . . . . . . . . . . . . 1990 15,779 sq m 55,196 sq m 26,472 sq m(1) 83.2% S$124.5 million S$135.1 million 602 700 124,947 households(2) Bandung Indah Plaza is owned by PT Megah Semesta Abadi and was built pursuant to a BOT Scheme based on the cooperation agreement on the renovation development and management of Hotel Pakunegara, Bandung (Perjanjian Kerjasama Pemugaran Pembangunandan Pengelolaan Hotel Pakunegara) between Perusahaan Daerah Jasa Dan Kepariwisataan Propinsi Jawa Barat, and formerly known as Perusahaan Daerah Kerta Wisata Jawa Barat and PT Bhuwanatala Inda Permai Tbk (formerly known as PT Bandung Indah Plaza Permai) (Bandung Indah Plaza Cooperation Agreement) and was novated by a novation agreement to PT Megah Semesta Abadi from PT Bhuwanatala Indah Permai Tbk. on 29 December 2003. The Bandung Indah Plaza Cooperation Agreement has been amended several times, among others with (i) Restatement and
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Business and properties Amendment to the Cooperation Agreement on the Renovation, Development and Management of Hotel Pakunegara, Bandung (Expansion and Renovation of Shopping CentrePernyataan Kembali dan Perubahan Perjanjian Kerjasama Pemugaran, Pembangunan dan Pengelolaan Hotel Pakunegara Bandung (Kerjasama, Perluasan dan/atau Renovasi Mall)) as stipulated under Deed No. 50, dated 19 July 2005, made before Ina Yulanti S.H., substitute for Tien Norman Lubis S.H., Notary in Bandung and (ii) Cooperation Agreement as stipulated under Deed No. 34, dated 22 December 2005, drawn up before Tien Norman Lubis S.H.Notary in Bandung (Amendment of the Cooperation Agreement). The Bandung Indah Plaza Cooperation Agreement, its amendments and the novation agreement are jointly referred to as the Bandung Indah Plaza BOT Agreement. The term of the Bandung Indah Plaza BOT Agreement is for 30 years as of the commencement of commercial operation and will expire on 31 December 2030. Bandung Indah Plaza was built on the following: (a) HGB Title No. 26/Citarum registered under the name of PT Megah Semesta Abadi expiring on 14 August 2010, covering an area of 1,066 sq m; and The following HGB titles over HPL Titles No. 1/Cihapit, No. 1/Citarum, No. 1/Merdeka, and No. 2/Citarum, registered under the name of Perusahaan Daerah Jasa Dan Kepariwisataan Propinsi Jawa Barat, which will be valid as long as the lands are being used: (i) HGB Title No. 130/Citarum, registered under the name of PT Megah Semesta Abadi expiring on 20 October 2017, covering an area of 160 sq m; HGB Title No. 131/Citarum, registered under the name of PT Megah Semesta Abadi, expiring on 20 October 2017, covering an area of 1,121 sq m; HGB Title No. 64/Citarum, registered under the name of by PT Megah Semesta Abadi, expiring on 20 October 2017, covering an area of 5,015 sq m; HGB Title No. 65/Citarum, registered under the name of by PT Megah Semesta Abadi expiring on 8 September 2019, covering an area of 1,355 sq m; HGB Title No. 69/Citarum, registered under the name of by PT Megah Semesta Abadi expiring on 8 September 2019, covering an area of 527 sq m; HGB Title No. 89/Merdeka, registered under the name of by PT Megah Semesta Abadi expiring on 30 January 2021, covering an area of 3,665 sq m; and

(b)

(ii)

(iii)

(iv)

(v)

(vi)

(vii) HGB Title No. 90/Merdeka, registered under the name of by PT Megah Semesta Abadi expiring on 30 January 2021, covering an area of 2,870 sq m. Perusahaan Daerah Jasa & Keparawisataan Jawa Barat (as BOT Grantor) allows PT Megah Semesta Abadi (as BOT
163

Business and properties Grantee) to sell or assign part of the HGB Certificates (owned by the BOT Grantee) to another party with prior written approval from PD Pariwisata and subject to written approval from the Governor of West Java. Instead of the transfer of the right of the BOT Agreement, which requires the consent of the BOT Grantor, the transfer of the interest of the BOT agreement may also be conducted through transfer of shares of the shareholders of PT Megah Semesta Abadi. The BOT Agreement does not prohibit the transfer of shares by the shareholders of PT Megah Semesta Abadi. Average Specialty Base Rent as at 30 June 2007 (Rp.000 per sq m per month) . . . . . . . . . . . . . . . . . . . . . . . NPI for Forecast Period 2007, Projection Year 2008 and Projection Year 2009 (S$000) . . . . . . . . . . . . . .

274

Forecast Period 20075,668 Projection Year 200811,756 Projection Year 200912,811

Percentage of contribution to LMIR Trusts Gross Rent for Forecast Period 2007 . . . . . . . . . . . . . . . . . . . . . . . . . 14.4% Notes: (1) (2) Recently completed asset enhancement works have increased the NLA by 3,843 sq m, bringing the total NLA to 30,315 sq m. The figure comprises the number of households within the primary trade area of the relevant Retail Mall. (See Appendix FIndependent Report on the Indonesian Retail Property Market.)

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Business and properties ISTANA PLAZA Jalan Pasirkaliki No. 121-123, Bandung, West Java

Bandung profile Bandung, the capital of West Java, is the fourth largest city in Indonesia. The population of Bandung was 2.1 million in 2001 and 2.2 million in 2004. These figures represent an average growth of 1.23% per annum. The population growth in Bandung is likely to generate strong consumer demand for retail facilities. The value of Bandungs GRDP grew by 7.4% per annum from Rp. 7,173 billion in 2003 to Rp. 7,704 billion in 2004. Meanwhile, the current value increased by 17.1% per annum from Rp. 23,420 billion in 2003 to Rp. 27,422 billion in 2004. Since the completion of the new Bandung-Jakarta highway in 2004, Bandungs retail industry has been developing rapidly and new retail concepts have been introduced. This includes specialised shopping centres (Bandung Electronic Centre and Be-Mall for computers and electronics, Istana Bandung Commodities Centre for home appliances and construction), stand-alone department stores (Yogya, Riau Junction and Carrefour hypermarket), and lifestyle shopping centres specialising in F&B and entertainment (Cihampelas Walk and Paris Van Java). Description Istana Plaza is a four storey with two basement levels retail mall with a carpark comprising 700 parking lots. It is located strategically in the heart of the CBD of Bandung, the fourth most populous city in Indonesia. Situated at the junction between two busy roads of Jalan Pasir Kaliki and Jalan Pajajaran, it is easily accessible by car and public transport. Anchored by Rimo Department Store and Hero Supermarket, the 205 tenancies in Istana Plaza provide one-stop shopping experience for the middle to upper income residents within its population catchment. Istana Plazas many popular international fashion labels have also helped to attract the young and trendy shopper base.
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Business and properties Tenant profile As at 30 June 2007, Istana Plaza has 205 retail tenants based on Committed Leases. The tenant profile of the mall comprises a diverse set of tenants from a wide variety of industries. The mall is anchored by Rimo Department Store, which occupies the first and second floors, amounting to approximately 17.9% of the malls total NLA. Other prominent tenants include Ace Hardware which occupies 5.9% of the malls total NLA. In addition, it is the only mall in its catchment area with a Nokia Professional Centre and a HewlettPackard Centre. As at 30 June 2007, the mall enjoys an occupancy rate of approximately 98.9%. The following chart provides a breakdown (by area) of the various trade sub-sectors represented in Istana Plaza as at 30 June 2007: Istana PlazaTrade sector analysis (By area)

Trade sub sector Department Store Fashion Food & Beverage/Food Court Leisure & Entertainment Home Furnishings Books & Stationery Supermarket / Hypermarket Gifts & Specialty Electronic/IT Other Sports & Fitness Services Toys Hobbies

Contribution (%) 18.9 14.3 13.8 9.5 6.8 6.7 5.5 5.1 4.8 4.6 3.5 2.9 2.6 1.0

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Business and properties The table below sets out information on the 10 largest tenants of Istana Plaza based on Committed Leases as at 30 June 2007:
Percentage of the total base rental income of Istana Plaza based on Committed Leases as at 30 June 2007 (%)

Tenant

Business sector

Lease expiry date

Percentage of total NLA (%)

Rimo Department Store . . . Ace Hardware . . . . . . . . . . Gramedia bookstore . . . . . Game Master . . . . . . . . . .

. . . .

Kiddy Land . . . . . . . . . . . . . Giovanni . . . . . . . . . . . . . . Pizza Hut . . . . . . . . . . . . . Planet Sport . . . . . . . . . . . Nike . . . . . . . . . . . . . . . . . Giordano. . . . . . . . . . . . . . . . . . .

Department Store Houseware Books & Stationery Leisure & Entertainment Leisure & Entertainment Fashion F&B Sports & Fitness Fashion Fashion

28 February 2012 28 February 2012 29 February 2012 30 November 2011 28 29 29 29 29 30 May 2007 January 2012 January 2012 November 2011 January 2012 September 2009

17.9 5.9 4.5 3.8 0.8 1.2 1.2 1.0 0.5 0.5 37.3 62.7 100.0

11.5 6.5 3.6 3.1 2.3 2.1 2.0 1.9 1.9 1.9 36.8 63.2 100.0

10 largest tenants . . . . . . . . Other tenants . . . . . . . . . . . Total . . . . . . . . . . . . . . . . .

Expiry profile The following table sets out the expiry profile of the tenancies at Istana Plaza as at 30 June 2007:
Monthly gross rent of expiring leases as a percentage of forecast rental income (%)

Period

Total number of leases expiring

NLA of expiring leases (sq m)

Expiring leases as a percentage of NLA as at 30 June 2007 (%)

FY2007 . . . . . . . FY2008 . . . . . . . FY2009 . . . . . . . Beyond FY2009 . Vacant . . . . . . . . Total . . . . . . . . . Note:

.. .. .. .. .. ..

.. .. .. .. .. ..

.. .. .. .. .. ..

.. .. .. .. .. ..

. . . . . .

43 41 26 95 205

1,089 1,490 2,705 21,661 303 27,247(1)

8.1 9.0 9.1 72.4 1.5 100.0(1)

4.0 5.5 9.9 79.5 1.1 100.0

(1) Due to rounding differences. Competition Existing: Istana Plaza, located two km from Bandung Indah Plaza, shares the same competitive landscape as Bandung Indah Plaza. (See Bandung Indah PlazaCompetition.) Future: Appendix FIndependent Report on the Indonesian Retail Property Market indicates that, at present, there are no known proposals for new centres to compete directly with Istana Plaza. However, given the relative strength of retail supply in recent years, particularly in Greater Jakarta, it is possible that future centres will be developed in Bandung. (See Appendix FIndependent Report on the Indonesian Retail Property Market.)
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Business and properties Other information The following table sets out other relevant information relating to Istana Plaza. Year of building completion . . . . . . . . Land Area . . . . . . . . . . . . . . . . . . . . . GFA as at 30 June 2007 . . . . . . . . . . NLA as at 30 June 2007 . . . . . . . . . . Occupancy rate as at 30 June 2007. . Appraised value by Knight Frank as at 30 June 2007 . . . . . . . . . . . . . . . . . . Appraised value by Colliers as at 30 June 2007 . . . . . . . . . . . . . . . . . . Car parking lots . . . . . . . . . . . . . . . . . Motorcycle parking lots . . . . . . . . . . . Population catchment . . . . . . . . . . . . Title . . . . . . . . . . . . . . . . . . . . . . . . . . 2001 13,082 sq m 37,434 sq m 27,247 sq m 98.9% S$125.7 million S$114.7 million 700 500 99,525 households(1) Istana Plaza is owned by PT Suryana Istana Pasundan and was built pursuant to a BOT Scheme based on cooperation agreement, dated 9 May 1997 between, Gereja Kristen Pasundon, Ginawan Chandra, Edi Sukainto Josona, Chandra Tambayang, Wirawan Chandra, Heryanto Gunawan Prihatra, Stepanus Tedjasentosa, Tat Ong Budiarta and Abrijanto Effendi (as consultants) (the Istana Plaza Cooperation Agreement). This Istana Plaza Cooperation Agreement was amended by (i) Amendment Agreement dated 28 April 2001 and (ii) Addendum Agreement dated 10 June 2004 (the Istana Plaza Cooperation Agreement and its amendments shall be jointly referred to as the Istana Plaza BOT Agreement). Based on this Istana Plaza BOT Agreement, Gereja Kristen Pasundan as BOT Grantor grants a right to PT Suryana Istana Pasundan as BOT grantee to construct a shopping centre building on top of the following HGB titles: (i) HGB Title No. 43/Pamoyanan, registered under the name of Gereja Kristen Pasundan, expiring on 24 September 2032, covering an area of 12,350 sq m; HGB Title No. 177/Pajajaran, registered under the name of Gereja Kristen Pasundan, expiring on 24 September 2032, covering an area of 40 sq m; HGB Title No. 58/Pamoyanan, registered under the name of Gereja Kristen Pasundan, expiring on 24 September 2032, covering an area of 86 sq m; HGB Title No. 59/Pamoyanan, registered under the name of Gereja Kristen Pasundan, expiring on 24 September 2036, covering an area of 361 sq m; and HGB Title No. 60/Pamoyanan, registered under the name of Gereja Kristen Pasundan, expiring on 24 September 2036, covering an area of 245 sq m.

(ii)

(iii)

(iv)

(v)

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Business and properties The Istana Plaza BOT Agreement is valid for 32 years from January 2002. Under the Istana Plaza BOT Agreement, assignment of ownership or encumbering the retail mall is prohibited except as security for a loan in relation to the construction of the retail mall. Instead of the transfer of the right of the BOT Agreement, which requires the consent of the BOT Grantor, the transfer of the interest of the BOT agreement may also be conducted through transfer of shares of the shareholders of PT Suryana Istana Pasundan. The BOT Agreement does not prohibit the transfer of shares by the shareholders of PT Suryana Istana Pasundan. As Pasundan Christian Church owns the land on which Istana Plaza is situated PT Suryana Istana Pasundan has no right to assign or encumber the land. Average Specialty Base Rent as at 30 June 2007 (Rp.000 per sq m per month) . . . . . . . . . . . . . . . . . . . . . . . NPI for Forecast Period 2007, Projection Year 2008 and Projection Year 2009 (S$000) . . . . . . . . . . . . . .

170

Forecast Period 20074,286 Projection Year 20088,958 Projection Year 20099,285

Percentage of contribution to LMIR Trusts Gross Rent for Forecast Period 2007 . . . . . . . . . . . . . . . . . . . . . . . . . 12.0% Note: (1) The figure comprises the number of households within the primary trade area of the relevant Retail Mall. (See Appendix FIndependent Report on the Indonesian Retail Property Market.)

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Business and properties MALL WTC MATAHARI UNITS Jalan Raya Serpong, Pondok Jagung, Serpong, Tangerang, Banten, Greater Jakarta

Description Mall WTC Matahari is located along Jalan Serpong Raya, Serpong within administrative area of Tangerang regency, Banten province. It is situated approximately 18 km west of Jakartas CBD. Tangerang is renowned as an industrial and manufacturing city in the Greater Jakarta area, being home to seven industrial estates with a total area of approximately over 1,700 ha. Due to its proximity to Jakarta, Tangerang benefits from the urban expansion of Jakarta and is home to commuters who work in Jakarta. In recent years, residential estates and satellite cities with their facilities have been developed in Tangerang. Mall WTC Matahari is strategically located along the main road connecting the BSD residential estate, the largest residential estate in Greater Jakarta. It has proposed development area of 6,000 ha with currently 1,500 ha developed and occupied by over 15,000 households. In recent years, BSD City has experienced rapid growth in terms of the number of housing units and retail shop houses which have been built. This has also successfully enhanced Mall WTC Mataharis target market segment from middle to middle-upper and upper class. The Mall WTC Matahari Units comprise four strata units on part of the ground floor, upper ground floor, mezzanine and second floor of the building, aggregating a total NLA of 11,184 sq m, representing 23.2% of the total NLA of Mall WTC Matahari. The Mall WTC Matahari Units are currently utilised as a department store, hypermarket and entertainment and game centre.

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Business and properties Relevant information relating to the Mall WTC Matahari Units The following table sets out other relevant information relating to the Mall WTC Matahari Units. NLA in respect of the Retail Space as at 30 June 2007 . . . . . . . . . . . . . . . . 11,184 sq m NLA as a percentage of the NLA of Mall WTC Matahari as at 30 June 2007 . . 23.2% Percentage of contribution to LMIR Trusts Gross Rent for Forecast Period 2007 . . . . . . . . . . . . . . . . . . . . . . . . . 2.5% Appraised value by Knight Frank as at 30 June 2007 . . . . . . . . . . . . . . . . . . Appraised value by Colliers as at 30 June 2007 . . . . . . . . . . . . . . . . . .

S$25.2 million

S$24.3 million

NPI contribution from the Retail Space for Forecast Period 2007, Projection Year 2008 and Projection Year 2009 (S$000) . . . . . . . . . . . . . . . . . . . . . . Forecast Period 2007843 Projection Year 20081,742 Projection Year 20091,770 Title . . . . . . . . . . . . . . . . . . . . . . . . . . Mall WTC Matahari was built on plots of land covering an area of (i) 3,470 sq m with Strata Titles Ownership Certificate No. 428/Desa Pondok Jagung dated 17 December 2004, (ii) 5,892 sq m with Strata Titles Ownership Certificate No. 00153/Desa Pondok Jagung dated 17 December 2004, (iii) 873 sq m with Strata Titles Ownership Certificate No. 00372/Desa Pondok Jagung dated 17 December 2004, and (iv) 949 sq m with Strata Titles Ownership Certificate No. 00197/Desa Pondok Jagung dated 17 December 2004, all of which are registered under the name of Matahari and its underlying HGB common land will expire on 8 April 2018 but is extendable for another term of up to 20 years. Following the expiration of this additional term, a renewal application may be made. (See Overview of Relevant Laws and Regulations in IndonesiaRights to Own and/or to useHak Guna Bangunan (HGB/Right to Build).) (See Business and PropertiesMall WTC Mahatari Units.)

Relevant information relating to Mall WTC Matahari The following table sets out other relevant information relating to Mall WTC Matahari. Year of building completion . . . . . . . Land Area . . . . . . . . . . . . . . . . . . . . NLA . . . . . . . . . . . . . . . . . . . . . . . . Carpark Lots . . . . . . . . . . . . . . . . . . Motorcycle Parking Lots . . . . . . . . . . . . . . 2003 35,886 sq m 48,204 sq m 1,101 500
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Business and properties METROPOLIS TOWN SQUARE UNITS Jalan Hartono Raya, Modernland Cikokol, Tangerang, Banten, Greater Jakarta

Description Metropolis Town Square is located in Tangerang city, Banten province, approximately 20 km west of Jakartas CBD. The CBDs strategic location near the main road connecting the toll road to Tangerang city provides easy access to the JakartaMerak toll gate and surrounding residential areas in Tangerang. Tangerang is an industrial and manufacturing city in Greater Jakarta, home to seven industrial estates with a total area of approximately 1,700 ha. Due to its proximity to Jakarta, Tangerang is a popular residential location for commuters who work in Jakarta. In recent years, residential estates and satellite cities (for example, Lippo Karawaci, Bumi Serpong Damai, Kota Modern, Alam Sutra, Summarecon Serpong and Bintaro Jaya) have been developed in Tangerang. Metropolis Town Square is located along Jalan Hartono Raya within the Kota Modern residential estate, about 2.6 km south of the city centre of Tangerang. Tangerangs strategic location between Jakarta and the Soekarno-Hatta International Airport makes it a popular choice for offices and factories. The Indonesian government has continuously been improving the quality of infrastructure between the city and the nations capital to accommodate the ever increasing road traffic. Metropolis Town Square is a one-stop shopping mall located along one of the main roads in Tangerang. Hence, the mall has good accessibility to passing traffic. In addition, the mall is the only major retail development in the Tangerang Municipality. The mall is designed in an art deco style and is located within the Modernland development, a large middle to upper income housing complex. The Metropolis Town Square Units comprise three strata units on part of the ground floor, first floor and second floor of the building, aggregating a total NLA of 15,248 sq m and representing 25.1% of the total NLA of Metropolis Town Square. The Metropolis Town Square Units are currently utilised as a department store, hypermarket and entertainment and games centre.
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Business and properties Relevant information relating to the Metropolis Town Square Units The following table sets out other relevant information relating to the Metropolis Town Square Units. NLA in respect of the Retail Space as at 30 June 2007 . . . . . . . . . . . . . . . . 15,248 sq m NLA as a percentage of the NLA of Metropolis Town Square as at 30 June 2007 . . . . . . . . . . . . . . . . . . . . . . . . . 25.1% Percentage of contribution to LMIR Trusts Gross Rent for Forecast Period 2007 . . . . . . . . . . . . . . . . . . . . . . . . . 3.3% Appraised value by Knight Frank as at 30 June 2007 . . . . . . . . . . . . . . . . . . Appraised value by Colliers as at 30 June 2007 . . . . . . . . . . . . . . . . . .

S$33.5 million

S$32.2 million

NPI contribution from the Retail Space for Forecast Period 2007, Projection Year 2008 and Projection Year 2009 (S$000) . . . . . . . . . . . . . . . . . . . . . . Forecast Period 20071,156 Projection Year 20082,382 Projection Year 20092,420 Title . . . . . . . . . . . . . . . . . . . . . . . . . . Metropolis Town Square Units are currently held by Matahari pursuant to Kiosks Sale and Purchase Binding Agreement (i) No. 093/AGR/DM/MPP/IX/03, dated 10 September 2003, (ii) No. 054/AGR/DM/MPP/VI/03, dated 23 June 2003 and (iii) No. 084/AGR/DM/MPP/VIII/03, dated 25 August 2003, all between Matahari and Coldwell Banker Dwimustika Mas. These Kiosks Sale and Purchase Binding Agreements are evidence of the parties intention to effect the sale and purchase of Strata Units, but do not have the effect of transferring ownership. This is a common practice in Indonesia. (See Risk FactorsRisks Relating to Investing in Real EstateLMIR Trust is dependent on the quality of the titles to the Properties.)

Relevant information relating to Metropolis Town Square The following table sets out other relevant information relating to Metropolis Town Square. Year of building completion . . . . . . . Land Area . . . . . . . . . . . . . . . . . . . . NLA . . . . . . . . . . . . . . . . . . . . . . . . Carpark Lots . . . . . . . . . . . . . . . . . . Motorcycle Parking Lots . . . . . . . . . . . . . . 2004 38,905 sq m 60,734 sq m 800 1,200
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Business and properties DEPOK TOWN SQUARE UNITS Jalan Margonda Raya No. 1, Pondok Cina Beji, Depok, Greater Jakarta

Description Depok is located in the West Java province, situated between southern Jakarta and the northern side of Bogor regency. The city is located approximately 16 km south of Jakartas CBD. Depok is renowned as the city of students, being home to four large universities (University of Indonesia, Gunadarma University, Tugu Polytechnic and Jakarta Polytechnic). Depoks population is estimated at 1.5 million in 2007 and has shown strong population growth, averaging 3.3% per annum between 2000 and 2005. In line with city population growth, the commercial area of Depok has been growing rapidly for the last few years, as evidenced by a number of modern shopping centre developments and commercial buildings built along the main road of Depok, Jalan Margonda Raya. Depok Town Square is located on Jalan Margonda Raya, adjacent to the south eastern side of University of Indonesia, a prominent university in Indonesia. The centre has direct access to Pondok Cina Railway Station at its rear entrance, and therefore connects the station to Jalan Margonda Raya. The Depok Town Square Units comprise four strata units on part of the lower ground floor, first floor and second floor of the building, aggregating a total NLA of 13,045 sq m and representing 31.7% of the total NLA of Depok Town Square. The Depok Town Square Units are currently utilised as a department store, hypermarket and entertainment and games centre.

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Business and properties Relevant information relating to the Depok Town Square Units The following table sets out other relevant information relating to the Depok Town Square Units. NLA in respect of the Retail Space as at 30 June 2007 . . . . . . . . . . . . . . . . 13,045 sq m NLA as a percentage of the NLA of Depok Town Square as at 30 June 2007 . . . . . . . . . . . . . . . . . . . . . . . . .

31.7%

Percentage of contribution to LMIR Trusts Gross Rent for Forecast Period 2007 . . . . . . . . . . . . . . . . . . . . . . . . . 2.5% Appraised value by Knight Frank as at 30 June 2007 . . . . . . . . . . . . . . . . . . Appraised value by Colliers as at 30 June 2007 . . . . . . . . . . . . . . . . . .

S$25.7 million

S$24.8 million

NPI contribution from the Retail Space for Forecast Period 2007, Projection Year 2008 and Projection Year 2009 (S$000) . . . . . . . . . . . . . . . . . . . . . . Forecast Period 2007861 Projection Year 20081,778 Projection Year 20091,807 Title . . . . . . . . . . . . . . . . . . . . . . . . . . Depok Town Square Units are currently held by Matahari pursuant to Kiosks Sale and Purchase Binding Agreement (i) No. 031/AGR/DM/MPP/XII/02, dated 19 December 2002 entered into between Matahari and Coldwell Banker Dwimustika Mas, and (ii) No. 012/JPN-PPJB/II/04, dated 11 February 2004, entered into between Matahari and PT Jagat Pertala Nusantara. These Kiosks Sale and Purchase Binding Agreements are evidence of the parties intention to effect the sale and purchase of strata units, but do not have the effect of transferring ownership. The strata titles are in the process of being issued by the local land office. Upon issuance, the strata titles will be purchased by the relevant Retail Space Indonesian SPC. (See Business and PropertiesDepok Town Square Units.) Relevant information relating to Depok Town Square The following table sets out other relevant information relating to Depok Town Square. Year of building completion . . . . . . . Land Area . . . . . . . . . . . . . . . . . . . . NLA . . . . . . . . . . . . . . . . . . . . . . . . Carpark Lots . . . . . . . . . . . . . . . . . . Motorcycle Parking Lots . . . . . . . . . . . . . . 2005 24,634 sq m 41,129 sq m 870 1,200
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Business and properties JAVA SUPERMALL UNITS Jalan MT Haryono No. 992-994, Jomblang, Semarang, Central Java

Description Semarang is the capital city of the Central Java province and the fifth largest city in terms of population in Indonesia. With its location along the northern coast of Java, Semarang is an important trading port for the region. Semarang had a population of 1.3 million in 2000 and is estimated to have grown annually at 2.6% per annum, registering a total increase of approximately 1.5 million over the last seven years. Java Supermall is located within the vicinity of a middle to upper class residential area which is easily accessible from most areas in Semarang. The Java Supermall Units comprise four strata units on the semi-basement, first floor and second floor of the building, aggregating a total NLA of 11,082 sq m, representing 56.0% of the total NLA of Java Supermall. The Java Supermall Units are currently utilised as a department store and supermarket. Relevant information relating to the Java Supermall Units The following table sets out other relevant information relating to the Java Supermall Units. NLA in respect of the Retail Space as at 30 June 2007 . . . . . . . . . . . . . . . . 11,082 sq m NLA as a percentage of the NLA of Java Supermall as at 30 June 2007. . 56.0%

Percentage of contribution to LMIR Trusts Gross Rent for Forecast Period 2007 . . . . . . . . . . . . . . . . . . . . . . . . . 2.4% Appraised value by Knight Frank as at 30 June 2007 . . . . . . . . . . . . . . . . . .
176

S$26.0 million

Business and properties Appraised value by Colliers as at 30 June 2007 . . . . . . . . . . . . . . . . . .

S$25.0 million

NPI from the Retail Space contribution for Forecast Period 2007, Projection Year 2008 and Projection Year 2009 (S$000) . . . . . . . . . . . . . . . . . . . . . . Forecast Period 2007836 Projection Year 20081,726 Projection Year 20091,754 Title . . . . . . . . . . . . . . . . . . . . . . . . . . Java Supermall was built on a plot of land covering an area of: (i) (ii) (iii) (iv) 3,839 sq m with Strata Titles Ownership Certificate No. 1/Desa Lamper Kidul dated 23 November 1998; 3,201 sq m with Strata Titles Ownership Certificate No. 2/Desa Lamper Kidul dated 23 November 1998; 3,772 sq m with Strata Titles Ownership Certificate No. 22/Desa Lamper Kidul dated 23 November 1998; and 270 sq m with Strata Titles Ownership Certificate No. 45/Desa Lamper Kidul dated 18 April 2000,

all of which are registered under the name of Matahari and its underlying HGB common land will expire on 24 September 2017 and is extendable for another term of up to 20 years. Following the expiry of this additional term, a renewal application may be made. (See Risk FactorsRisks Relating to Investing in Real EstateLMIR Trust is dependent on the quality of the titles to the Properties.) Relevant information relating to Java Supermall The following table sets out other relevant information relating to Java Supermall. Year of building completion . . . . . . . . Land Area . . . . . . . . . . . . . . . . . . . . . NLA . . . . . . . . . . . . . . . . . . . . . . . . . Carpark Lots . . . . . . . . . . . . . . . . . . . Motorcycle Parking Lots . . . . . . . . . . 2000 10,800 sq m 19,800 sq m 700 2,000

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Business and properties MALANG TOWN SQUARE UNITS JaIan Veteran No. 2, Malang, East Java

Description Malang is the second largest city in the East Java province with a population of approximately 0.8 million and a regency population of approximately 2.4 million. The region is a popular tourist destination due to its natural attractions (for example, Mount Bromo, one of Javas largest volcanoes), cool climate and colonial history. Malang also has a large student population, being home to five universities (Brawijaya, State, Muhammadiyah, Widya Gama and Merdeka Universities). Malang Town Square, in which Malang Town Square Units are located, is a mall conceptualised as an international lifestyle mall as well as the biggest and most comprehensive mall in Malang. The centre has easy access to public transportation and is surrounded by exclusive residential communities and several universities which have more than 50,000 students. The Malang Town Square Units comprise three strata units on part of the ground floor, upper ground floor, first floor and second floor of the building, aggregating a total NLA of 11,065 sq m, representing 44.7% of the total NLA of Malang Town Square. The Malang Town Square Units are currently utilised as a department store, hypermarket and entertainment and games centre.

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Business and properties Relevant information relating to the Malang Town Square Units The following table sets out other relevant information relating to the Malang Town Square Units. NLA in respect of the Retail Space as at 30 June 2007 . . . . . . . . . . . . . . . . 11,065 sq m NLA as a percentage of the NLA of Malang Town Square as at 30 June 2007 . . . . . . . . . . . . . . . . . . . . . . . . .

44.7%

Percentage of contribution to LMIR Trusts Gross Rent for Forecast Period 2007 . . . . . . . . . . . . . . . . . . . . . . . . . 2.4% Appraised value by Knight Frank as at 30 June 2007 . . . . . . . . . . . . . . . . . . Appraised value by Colliers as at 30 June 2007 . . . . . . . . . . . . . . . . . .

S$25.5 million

S$25.8 million

NPI contribution from the Retail Space for Forecast Period 2007, Projection Year 2008 and Projection Year 2009 (S$000) . . . . . . . . . . . . . . . . . . . . . . Forecast Period 2007834 Projection Year 20081,723 Projection Year 20091,751 Title . . . . . . . . . . . . . . . . . . . . . . . . . . Malang Town Square Units are constructed on HBG land titles and are exclusively controlled currently by Matahari pursuant to Kiosks Sale and Purchase Binding Agreement No. 031/PNPPJB/X/03, dated 7 October 2003 between Matahari and PT Pendopo Niaga. The Kiosks Sale and Purchase Binding Agreement is evidence of the parties intention to effect the sale and purchase of strata units, but do not have the effect of transferring ownership. This is a common practice in Indonesia. (See Risk FactorsRisks Relating to Investing in Real EstateLMIR Trust is dependent on the quality of the titles to the Properties.)

Relevant information relating to Malang Town Square The following table sets out other relevant information relating to Malang Town Square. Year of building completion . . . . . . . . Land Area . . . . . . . . . . . . . . . . . . . . . NLA . . . . . . . . . . . . . . . . . . . . . . . . . Carpark Lots . . . . . . . . . . . . . . . . . . . Motorcycle Parking Lots . . . . . . . . . . 2005 18,500 sq m 24,740 sq m 544 720
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Business and properties PLAZA MADIUN Jalan Pahlawan, Madiun, East Java

Description The city of Madiun, with a total population of 0.2 million (based on a 2005 census), is the capital city of Madiun regency in the East Java province. The Madiun regency has a total land area of 1,011 sq km and its population exceeds 0.6 million (based on a 2001 census). (See Appendix FIndependent Report on the Indonesian Retail Property Market.) Madiun has benefited from its position which connects major cities in Central and East Java. It is the home of Indonesias first and largest train manufacturer and is a major sugar producer in Java. The industrial sector and trade, hotel and restaurant businesses are key revenue generators for the city, having contributed around 27.0% and 20.0%, respectively, to Madiuns GRDP (based on economic statistics in 2004). Plaza Madiun is located along Jalan Pahlawan, a major road of the city which is also the primary thoroughfare in the city of Madiun. The street is positioned in the centre of the commercial and administrative zone, at the crossroad of three existing subdistricts of Madiun. Most of the prominent buildings in Madiun are included in this precinct, including the City Hall, Merdeka Hotel, Tentara Hospital and Pasaraya Shopping Centre. Jalan Pahlawan is accessible from Jalan Sudirman, another major thoroughfare in the city. Plaza Madiun enjoys high pedestrian traffic from Jalan Pahlawan and is in close proximity to various forms of public transportation options. Plaza Madiun, aggregating a total NLA of 19,029 sq m situated on two HGB titles, comprises the basement, first floor, second floor and third floor and are currently occupied by a supermarket and a department store.
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Business and properties Relevant information relating to Plaza Madiun The following table sets out other relevant information relating to Plaza Madiun. NLA as at 30 June 2007 . . . . . . . . . . NLA as a percentage of the NLA of Plaza Madiun as at 30 June 2007 . . . 19,029 sq m 100.0%

Percentage of contribution to LMIR Trusts Gross Rent for Forecast Period 2007 . . . . . . . . . . . . . . . . . . . . . . . . . 3.1% Appraised value by Knight Frank as at 30 June 2007 . . . . . . . . . . . . . . . . . . Appraised value by Colliers as at 30 June 2007 . . . . . . . . . . . . . . . . . . NPI contribution for Forecast Period 2007, Projection Year 2008 and Projection Year 2009 (S$000) . . . . . . S$33.4 million S$31.8 million

Forecast Period 20071,081 Projection Year 20082,228 Projection Year 20092,264

Title . . . . . . . . . . . . . . . . . . . . . . . . . .

Plaza Madiun was built on a plot of land covering an area of (i) 5,501 sq m with HGB Certificate No. 186/Kelurahan Pangongangan dated 3 June 1997, registered under the name of Matahari and will expire on 10 February 2012; and 82 sq m with HGB Certificate No. 188/ Kelurahan Pangongangan dated 12 February 1998, registered under the name of Matahari and will expire on 10 February 2012.

(ii)

Both HGB titles are extendable for another 20 years. Following the expiry of this additional term, a renewal application may be made. (See Overview of Relevant Laws and Regulations in IndonesiaRights to Own and/or to UseHak Guna Bangunuan (HGB/Right to Build).) (See Business and PropertiesPlaza Madiun.) Year of building completion . . . . . . . . Land Area . . . . . . . . . . . . . . . . . . . . . Carpark Lots . . . . . . . . . . . . . . . . . . . Motorcycle Parking Lots . . . . . . . . . . 2000 5,583 sq m 80 400

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Business and properties GRAND PALLADIUM MEDAN UNITS Jalan Kapt. Maulana Lubis, Medan, North Sumatra

Description Medan, the provincial capital of the North Sumatra, is the largest city in Sumatra and the third most populous city in Indonesia after Jakarta and Surabaya. It is a cosmopolitan city with a population of over 2.0 million. Medan is a growing commercial centre in the region, mainly with agriculture and industry businesses. The city was transformed from a tobacco plantation village in the 19th century to a major government and commercial centre at present. In terms of economic activity, Medan relies on its natural resources as well as processing industries. Over the years, Medan has been a supplier of vegetable oil, seafood, crafts and various agricultural products to a number of Asian and European countries. Grand Palladium Medan is conveniently located within the Medan CBD and is only 2.5 km from the Polonia International Airport. The mall is located in the centre of Medan, hence drawing shoppers from all around the city. It is surrounded by government and business offices and the town hall, and therefore benefits from regular crowds of government and business visitors. The mall will potentially witness greater visitor traffic from the proposed office and hotel developments in the vicinity. The Grand Palladium Medan Units comprise four strata units in part of the basement, lower ground floor, upper ground floor, first floor and third floor of the building, aggregating a total NLA of 13,417 sq m, representing 45.8% of the total NLA of Grand Palladium Medan. The Grand Palladium Medan Units are currently utilised as a department store, hypermarket and entertainment and games centre.
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Business and properties Relevant information relating to the Grand Palladium Medan Units The following table sets out other relevant information relating to the Grand Palladium Medan Units. NLA in respect of the Retail Space as at 30 June 2007 . . . . . . . . . . . . . . . . 13,417 sq m NLA as a percentage of the NLA of Grand Palladium Medan as at 30 June 2007 . . . . . . . . . . . . . . . . . . . . . . . . . 45.8% Percentage of contribution to LMIR Trusts Gross Rent for Forecast Period 2007 . . . . . . . . . . . . . . . . . . . . . . . . . 2.6% Appraised value by Knight Frank as at 30 June 2007 . . . . . . . . . . . . . . . . . . Appraised value by Colliers as at 30 June 2007 . . . . . . . . . . . . . . . . . . S$26.2 million S$25.2 million

NPI contribution from the Retail Space for Forecast Period 2007, Projection Year 2008 and Projection Year 2009 (S$000) . . . . . . . . . . . . . . . . . . . . . . Forecast Period 2007886 Projection Year 20081,829 Projection Year 20091,859 Title . . . . . . . . . . . . . . . . . . . . . . . . . . The Grand Palladium Medan Units are constructed on HGB titles and are currently exclusively controlled by Matahari pursuant to Kiosks Sale and Purchase Binding Agreement No. 011/UPIPPJB/IX/04, dated 14 September 2004 between Matahari and PT Unitech Prima Indah. This Kiosks Sale and Purchase Binding Agreement is evidence of the parties intention to effect the sale and purchase of strata units, but does not have the effect of transferring ownership. The strata titles are in the process of being issued by the local land office. Upon issuance, the strata titles will be purchased by the relevant Retail Space Indonesian SPC. (See Business and PropertiesGrand Palladium Medan Units.) This is a common practice in Indonesia. (See Risk FactorsRisks Relating to Investment in Real EstateLMIR Trust is dependent on the quality of the titles to the Properties.) Relevant information relating to Grand Palladium Medan The following table sets out other relevant information relating to Grand Palladium Medan. Year of building completion . . . . . . . . Land Area . . . . . . . . . . . . . . . . . . . . . NLA . . . . . . . . . . . . . . . . . . . . . . . . . Carpark Lots . . . . . . . . . . . . . . . . . . . Motorcycle Parking Lots . . . . . . . . . . ACQUISITION PIPELINE The Sponsor has granted LMIR Trust, for so long as (a) Lippo-Mapletree Indonesia Retail Trust Management Ltd. remains the manager of LMIR Trust and (b) the Sponsor and/or any of its
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2005 10,640 sq m 29,272 sq m 1,200 700

Business and properties related corporations, alone or in aggregate, remains a controlling shareholder of the Manager, a ROFR over any Relevant Asset (i) which any Sponsor Entity proposes to sell or transfer (whether such Relevant Asset is wholly-owned or partly-owned by the Sponsor Entity and excluding any sale of such Relevant Asset by a Sponsor Entity to any related corporation of such Sponsor Entity pursuant to a reconstruction, amalgamation, restructuring, merger or any analogous event) to an unrelated third party or (ii) for which a proposed offer for sale or transfer of such Relevant Asset has been made to a Sponsor Entity (see Certain Agreements Relating to LMIR Trust and the PropertiesDescription of the Right of First Refusal Agreement). As at the Latest Practicable Date, the ROFR Properties are expected to have an aggregate GFA of approximately 397,080 sq m, and an aggregate NLA of approximately 273,074 sq m. If LMIR Trust acquires all the ROFR Properties, the aggregate NLA of LMIR Trusts initial property portfolio will increase by over 270,000 sq m, and will represent approximately 87.1% of the aggregate NLA of LMIR Trusts initial property portfolio as at 30 June 2007. The Manager believes that the ROFR granted to LMIR Trust provides a visible pipeline of future acquisitions and will greatly enhance LMIR Trusts growth profile given the size and quality of the ROFR Properties, as well as significantly increase LMIR Trusts presence in the Indonesian retail markets. The following tables set out the relevant information relating to the ROFR Properties. Binjai Supermall Jalan Soekarno Hatta, Binjai, North Sumatra Expected completion date . . . . . . . . . . . . . . . . . . Estimated GFA . . . . . . . . . . . . . . . . . . . . . . . . . . Estimated NLA . . . . . . . . . . . . . . . . . . . . . . . . . . Target segment . . . . . . . . . . . . . . . . . . . . . . . . . . Fourth quarter of 2007 23,615 sq m 18,300 sq m Middle to middle-upper income groups in Medan, North Sumatra and the surrounding suburban areas. Medan, North Sumatra

District/Area . . . . . . . . . . . . . . . . . . . . . . . . . . . . Description

Binjai Supermall, when completed, will be a two-level retail mall prominently located along the main road from North Sumatra to Medan. The mall has a wide population catchment area which covers Binjai and Medan. There are approximately 2.2 million people within its immediate catchment area. Positioned as a lifestyle mall for the middle to upper middle income segments of the retail market, Binjai Supermall targets a wide range of customers, including families, business people and teenagers. The potential strong tenancy mix, which includes an amusement centre and plentiful food and cafe outlets, will draw shoppers to the mall. Pejaten Mall Jalan Warung Jati Barat, South Jakarta Expected completion date . . . . . . . . . . . . . . . . . . Estimated GFA . . . . . . . . . . . . . . . . . . . . . . . . . . Estimated NLA . . . . . . . . . . . . . . . . . . . . . . . . . . Target segment . . . . . . . . . . . . . . . . . . . . . . . . . . District/Area . . . . . . . . . . . . . . . . . . . . . . . . . . . . Second quarter of 2008 57,948 sq m 40,327 sq m Middle to upper income residents from South Jakarta and the surrounding suburban areas. South Jakarta

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Business and properties Description Pejaten Mall is located along Jalan Warung Jati Barat, a major road linking central Jakarta to the southern part of Jakarta. This proposed six-level retail mall will cater to the upper income housing estates, surrounding this site in South Jakarta. It is intended that the tenant mix will comprise a hypermarket, a department store and specialty shops. Kuta Beach Mall Kartika Plaza Road, Kuta, Bali Expected completion date . . . . . . . . . . . . . . . . . . Estimated GFA . . . . . . . . . . . . . . . . . . . . . . . . . . Estimated NLA . . . . . . . . . . . . . . . . . . . . . . . . . . Target Segment. . . . . . . . . . . . . . . . . . . . . . . . . . District/Area . . . . . . . . . . . . . . . . . . . . . . . . . . . . Description Kuta Beach Mall is located along Kartika Plaza road which is the main road connecting Ngurah Rai Airport to the Kuta Beach area. This proposed retail mall targets the tourist and local population. The theme of Kuta Beach Mall reflects the relaxed lifestyle of Bali and includes a tenant mix comprising F&B, fashion, entertainment and a variety of stores catering to daily convenience needs. Kemang City Mall Jalan Pangeran Antasari, South Jakarta Expected completion date . . . . . . . . . . . . . . . . . . Estimated GFA . . . . . . . . . . . . . . . . . . . . . . . . . . Estimated NLA . . . . . . . . . . . . . . . . . . . . . . . . . . Target segment . . . . . . . . . . . . . . . . . . . . . . . . . . District/Area . . . . . . . . . . . . . . . . . . . . . . . . . . . . Description Kemang City Mall is located in Kemang, South Jakarta. It will be positioned to blend a tenant mix including tenants specialising in leisure, hospitality, entertainment, education, retail, and residential. It offers enjoyable views of both the river and the scenic Pangeran Antasari Street. The scale of this project will enable customers to be drawn from a vast catchment area across Jakarta. Puri Paragon City Jalan Puri Indah Raya, West Jakarta Expected completion date . . . . . . . . . . . . . . . . . . Estimated GFA . . . . . . . . . . . . . . . . . . . . . . . . . . Estimated NLA . . . . . . . . . . . . . . . . . . . . . . . . . . Target segment . . . . . . . . . . . . . . . . . . . . . . . . . . District/Area . . . . . . . . . . . . . . . . . . . . . . . . . . . . Second half of 2009 196,400 sq m 127,660 sq m Middle to upper income residents from West Jakarta and the surrounding suburban areas. West Jakarta
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Second half of 2008 41,562 sq m 30,735 sq m Tourists and residents of Kuta, Bali Kuta, Bali

First half of 2009 77,555 sq m 56,052 sq m Middle to upper income residents from South Jakarta and the surrounding suburban areas South Jakarta

Business and properties Description Puri Paragon City will be the first of its kind in West Jakarta, offering a mixed-used development comprising a retail mall, residential apartments, a school, and a hotel. It is located along Puri Indah Raya Street with access from Tomang, Tangerang, and Daan Mogot. A major benefit will be its direct access to the major toll road linking Jakarta to West Jakarta and Tangerang. POTENTIAL ACQUISITION OF PROPERTIES FROM THIRD PARTY VENDORS As at the Latest Practicable Date, the Manager has entered into a non-binding memorandum of understanding with: (i) (ii) (iii) PT. Multi Pratama Gemilang Perkasa (Pikko Group) in respect of the potential acquisition by LMIR Trust of Cosmopolitan Mall Pluit, a retail mall located in North Jakarta; Zellwager Enterprise Limited in respect of the potential acquisition by LMIR Trust of Sun Plaza, a retail mall located in Medan, North Sumatra; and PT. Pakuwon Permai in respect of the potential acquisition by LMIR Trust of Supermal Pakuwon Indah and Pakuwon Trade Center, a retail mall located in West Surabaya, East Java.

(See Certain Agreements relating to LMIRT and the PropertiesDescription of Non-Binding Memorandum of Understanding.) The Manager understands that Cosmopolitan Mall Pluit is currently undergoing asset enhancement works, with such works scheduled for completion in the second half of 2008. Cosmopolitan Mall Pluit Pluit, North Jakarta Expected completion date of renovation . . . . . . . Estimated GFA . . . . . . . . . . . . . . . . . . . . . . . . . . Estimated NLA . . . . . . . . . . . . . . . . . . . . . . . . . . Target segment . . . . . . . . . . . . . . . . . . . . . . . . . . District/Area . . . . . . . . . . . . . . . . . . . . . . . . . . . . Estimated acquisition price . . . . . . . . . . . . . . . . . Second half of 2008 131,013 sq m 88,040 sq m Middle to upper income residents of North Jakarta North Jakarta To be negotiated and agreed in good faith between the parties, provided that such acquisition price shall not be more than the appraised value of Cosmopolitan Mall Pluit as determined by an independent property valuer to be appointed by the Trustee before the signing of the conditional sale and purchase agreement.

Description Located in the heart of the affluent Pluit residential district of North Jakarta, Cosmopolitan Mall Pluit offers an exciting cultural and retail experience, with urban sculptures along the waterfront, blending harmoniously with a variety of lifestyle and cuisines outlets.

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Business and properties Sun Plaza Medan, North Sumatra Estimated GFA . . . . . . . . . . . . . . . . . . . . . . . . . . Estimated NLA . . . . . . . . . . . . . . . . . . . . . . . . . . Target segment . . . . . . . . . . . . . . . . . . . . . . . . . . District/Area . . . . . . . . . . . . . . . . . . . . . . . . . . . . Estimated acquisition price . . . . . . . . . . . . . . . . . 73,871 sq m 61,348 sq m Middle to upper income residents of Medan Medan To be negotiated and agreed in good faith between the parties, provided that such acquisition price shall not be more than the appraised value of Sun Plaza as determined by an independent property valuer to be appointed by the Trustee before the signing of the conditional sale and purchase agreement.

Description Sun Plaza is a six-level retail mall located in the Indonesian city of Medan, the third most populous city in Indonesia after Jakarta and Surabaya. Sun Plaza is surrounded by government and business offices and is accessible from all parts of Medan City. The titanium faade of Sun Plaza resembles a sculpture and offers visitors an experience of luxury and elegance. Supermal Pakuwon Indah and Pakuwon Trade Center West Surabaya, East Java Estimated GFA . . . . . . . . . . . . . . . . . . . . . . . . . . Estimated NLA . . . . . . . . . . . . . . . . . . . . . . . . . . Target segment . . . . . . . . . . . . . . . . . . . . . . . . . . District/Area . . . . . . . . . . . . . . . . . . . . . . . . . . . . Estimated acquisition price . . . . . . . . . . . . . . . . . 289,563 sq m 114,834 sq m Middle to upper income residents of West Surabaya West Surabaya To be negotiated and agreed in good faith between the parties, provided that such acquisition price shall not be more than the appraised value of Supermal Pakuwon Indah and Pakuwon Trade Center as determined by an independent property valuer to be appointed by the Trustee and the appraised value is agreed by the Vendor before the signing of the conditional sale and purchase agreement.

Description Supermal Pakuwon Indah and Pakuwon Trade Center is strategically located in the heart of West Surabayas affluent residential district. The tenants of Supermal Pakuwon Indah and Pakuwon Trade Center provide a variety of shopping, dining and entertainment options to shoppers. Together with the convention centre facilities, the retail mall aims to deliver a memorable and exciting retail experience. In the future, the Manager will identify other potential acquisitions and will enter into negotiations and nonbinding memoranda of understanding with regard to these potential acquisitions.
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The Manager and corporate governance

THE MANAGER OF LMIR TRUST The Manager, Lippo-Mapletree Indonesia Retail Trust Management Ltd., was incorporated in Singapore under the Companies Act on 3 May 2007. As at the Listing Date, it has a paid-up capital of S$1.0 million, its registered office is located at 78 Shenton Way, #05-01 Lippo Centre, Singapore 079120 and its telephone and facsimile numbers are (65) 6410 9138 and (65) 6220 6557, respectively. The Manager is 40.0% owned by Mapletree Capital and 60.0% owned by Peninsula Investment Ltd. Peninsula Investment Ltd is in turn 100.0% owned by Jesselton Investment Ltd, a wholly-owned subsidiary of the Sponsor. Mapletree Capital, a wholly-owned subsidiary of MIPL, is a private limited company incorporated in Singapore under the Companies Act on 6 October 2004. As at 30 June 2007, it has a paid-up capital of S$2.00 and its registered office is located at 1 Maritime Square, #13-01 HarbourFront Centre, Singapore 099253. MIPL is a leading Asia-focused real estate company based in Singapore. The Mapletree Group, which MIPL is a part of, has an asset base of approximately S$4.5 billion (as at 30 June 2007) comprising office, logistics, industrial, residential and retail/lifestyle properties. (See StrategyAcquisition Growth StrategyLMIR Trusts relationship with the Mapletree Group.) Directors of the Manager The Board is entrusted with the responsibility for the overall management of the Manager. The following table sets forth information regarding the Directors:
Name Age Address Position

Tan Bar Tien . . . . . . Lim Ho Seng. . . . . . Lok Vi Ming . . . . . . Viven G. Sitiabudi . .

57 64 46 52

Yeo Cheow Tong. . . Tan Boon Leong . . . Wong Mun Hoong . .

60 54 41

129 Aroozoo Avenue Singapore 539880 100 Neo Tiew Road Singapore 719026 21 Fernwood Terrace Singapore 458559 130 Tanjong Rhu Road Pebble Bay Block M #17-12 Singapore 436918 25 Maryland Drive Singapore 277519 89 Chuan Drive Singapore 554734 12A Lorong J Telok Kurau Singapore 423489

Chairman, Non-Executive and Independent Director Non-Executive and Independent Director Non-Executive and Independent Director Executive Director and Chief Executive Officer

Non-Executive Director Non-Executive Director Non-Executive Director

Ms Viven G. Sitiabudi and Mr Yeo Cheow Tong are nominees of the Sponsor. Mr Tan Boon Leong and Mr Wong Mun Hoong are nominees of the Mapletree Group. Mr Tan Bar Tien, Mr Lim Ho Seng and Mr Lok Vi Ming are independent directors. Save as disclosed in this Prospectus, none of the Directors is related to one another, any substantial shareholder of the Manager or any Substantial Unitholder. Experience and expertise of the Board of Directors Information on the business and working experience of each Director is set out below: Mr Tan Bar Tien Mr Tan Bar Tien is the Chairman as well as a Non-Executive and Independent Director of the Manager. A lawyer, Mr Tan has been running his own law firm, M/s B.T. Tan & Co, since 1982. With 30 years of
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The Manager and corporate governance experience in practice, Mr Tan has extensive experience in various aspects of law including corporate law, property law and litigation matters. Mr Tan has represented clients in transactions in relation to completed properties and properties under construction. Having been involved in conveyancing work for the last 28 years, Mr Tan is familiar with real estate matters such as property mortgages, sale and purchase of properties, construction loans and developers projects, including the construction of properties on a progressive basis. Mr Tan graduated from the University of Singapore in 1976 with a degree in Bachelor of Laws (Honours), and was admitted as an Advocate and Solicitor of the High Court of Singapore in January 1977. Mr Lim Ho Seng Mr Lim Ho Seng is a Non-Executive and Independent Director of the Board. Mr Lim has over 20 years of experience in the retail industry. Mr Lim was formerly the Chief Executive Officer of NTUC Fairprice Cooperative Ltd, which has investments in real estate and leases retail spaces to other retail tenants. From October 1992 to August 1997, Mr Lim was a director of Tampines Mall Pte Ltd which was incorporated to develop and manage Tampines Mall shopping centre, which was subsequently acquired by CapitaMall Trust. Currently, Mr Lim is the Chairman of Baker Technology Limited and Sim Siang Choon Ltd, in addition to holding directorships on the boards of several other publicly listed companies in Singapore. Mr Lim is a Fellow of the Institute of Certified Public Accountants of Singapore, the Institute of Certified Public Accountants, Australia, the Association of Chartered Certified Accountants, United Kingdom, the Institute of Chartered Secretaries and Administrators, United Kingdom and the Singapore Institute of Directors. Mr Lok Vi Ming Mr Lok Vi Ming is a Non-Executive and Independent Director of the Board. He is currently a partner and head of the Aviation Practice Group at M/s Rodyk & Davidson. Appointed as a Senior Counsel in 2005, Mr Lok is an internationally renowned aviation lawyer. He is featured in Euromoney Legal Medias Guide and Guide to the Worlds Leading Insurance and Reinsurance lawyers and also in the International Whos Who of Aviation lawyers 2005. Mr Lok is a Fellow of the Singapore Institute of Arbitrators and has been appointed to the Regional Panel of Arbitrators with the Singapore International Arbitration Centre. He is a Fellow of the Singapore Academy of Law and is on the committee for the International Promotion of Singapore Law. He has been appointed by the Honourable Chief Justice of Singapore to chair Disciplinary Committees convened to hear complaints into the conduct of lawyers. Mr Lok has lectured on Aviation Law at the Law Faculty of the National University of Singapore and at the Singapore Aviation Academy. He is also the immediate past Chairman of the Aerospace Committee of the Inter-Pacific Bar Association and is on the International Advisory Panel of the Registry of Aircraft Parts established under the Cape Town Convention. Mr Lok currently holds directorships in various companies including Singapore Cruise Center Pte Ltd, Singex Exhibitions Pte Ltd, and Singapore Food Industries Ltd. Since 2003, Mr Lok has been appointed as a director of Singex Venues Pte Ltd, which operates and manages Singapore Expo, the largest exhibition and convention centre in Singapore. Mr Lok graduated with a Bachelor of Law (Honours) from the National University of Singapore in 1986. Ms Viven G. Sitiabudi Ms Viven G. Sitiabudi (also known as Mrs Viven Gouw) is an Executive Director of the Board and the Chief Executive Officer of the Manager. Ms Sitiabudi has more than 20 years of experience in management, marketing and sales. Since 2004, Ms Sitiabudi has been appointed the President Director of the Sponsor, especially following the Sponsors internal restructuring which involved the merger of eight different entities. Under her stewardship in the past three years, the Sponsor has become the largest listed property company in Indonesia to date. She has been integral in identifying the opportunity for the Sponsor to invest in retail
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The Manager and corporate governance properties (the strata malls and the planned leased malls), enhancing existing assets and ensuring the delivery of the Sponsors development projects, which span across a variety of real estate sectors, including urban/township, residential clusters, condominium, hospitals as well as hotel projects, throughout Indonesia. Prior to her appointment as the President Director of the Sponsor, Ms Sitiabudi was a senior adviser to the board of directors of Lippo Land Development (LLD) from 1990 to 1995. LLD is a property arm/flagship of the Lippo Group during the said period and has since been merged with seven other property-related companies to form the Sponsor. In her 5-year period at LLD, she led LLD to complete Citra Graha (formerly known as LippoCenter) and Wisma BCA. She also identified opportunities and oversaw the construction of various property projects throughout Indonesia for LLD. These projects include LippoCenter Bandung, Sudirman Tower, LippoCikarang (formerly known as Bekasi Industrial Estate), Puncak Resort (formerly known as CipanasHill Resort), Lippo Karawaci township (formerly known as JakartaBaru township), Seaworld Indonesia, Supermal Karawaci (formerly known as LippoVillageMall), Imperial Aryaduta Karawaci (formerly known as Century Hotel), Asia Tower, Dynaplast Tower, UPH building, Sudirman Tower Condominium, Carita Bay Resort, Golf Karawaci Condo, Crown Court Condo, Siloam Hospital, Pacific Tower, Amartapura Condo, Hotel Sahid Lippo Cikarang, Mal Lippo Cikarang, a golf course in Lippo Karawaci and Tanjung Bunga township in Makassar. From 1984 to 1995, Ms Sitiabudi was the President Director of PT Lippo Life Insurance. Under her leadership, PT Lippo Life Insurance became one of the largest life insurance companies in Indonesia, with Ms Sitiabudi leading its initial public offering in 1989. In 1996, Ms Sitiabudi was appointed Chief Executive Officer of Legal and General Australias operations in Indonesia. Three years later, Ms Sitiabudi joined Allianz Life Indonesia as its Vice President Director. Ms Sitiabudi graduated from the University of New South Wales, Australia in 1977 with a degree in Computer Science and Statistics. Mr Yeo Cheow Tong Mr Yeo Cheow Tong is a Non-Executive Director of the Board. He has been a prominent figure in the Singapore political landscape for over 20 years and had previously held different ministerial positions in the Singapore government such as Minister of Transport, Minister of Health, Minister for Community Development, Minister for Trade and Industry and Minister for the Environment. He is currently a Member of Parliament for Hong Kah Group Representation Constituency. Mr Yeo sits on the panel of advisers for Temasek Holdings (Private) Limited, Lippo Group, Raffles Education Corporation as well as that for the University of Chicago Graduate School of Business. In addition, he holds the position of chairman of the Board of Governors of Raffles University, and is also a director of KillyInvest Pte Ltd. Mr Yeo graduated from the University of Western Australia in 1971 with a Bachelors degree in Engineering. Mr Tan Boon Leong Mr Tan Boon Leong is a Non-Executive Director of the Manager. He has 32 years of experience in the real estate industry and is currently the Chief Operating Officer of MIPL. He is also a director of Mapletree Logistics Trust Management Ltd, the manager of MapletreeLog (which is listed on the SGX-ST), from July 2005. He chairs the Asset Control Group for VivoCity, the largest retail mall in Singapore. Prior to joining MIPL in June 2003, he was a managing director of Temasek Holdings (Private) Limited, overseeing private equity investments in the property and infrastructure sectors, both locally and overseas. He was with Temasek Holdings (Private) Limited from December 1995. Mr Tan is a Colombo Plan scholar and studied urban valuation (real estate) at the University of Auckland, New Zealand and worked with IRAS upon his graduation, from 1975 to 1995. While at IRAS, he was involved in the valuation of real estate in Singapore and rose to become a Superscale Officer and held the appointments of Tax Director (Technical ServicesProperty) and Head of Property and Valuation Services. Mr Tan is a member of the Valuation Review Board of Singapore.
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The Manager and corporate governance Mr Wong Mun Hoong Mr Wong Mun Hoong is a Non-Executive Director of the Manager. He joined MIPL as Chief Financial Officer in January 2006. As the Chief Financial Officer, he is responsible for Finance, Treasury, Corporate Planning & Investor Relations, Risk Management and Information Technology of the Mapletree Group. He is also a director of Mapletree Logistics Trust Management Ltd, the manager of MapletreeLog (which is listed on the SGX-ST), since July 2006. Prior to joining MIPL, Mr Wong has over 14 years investment banking experience in Asia, the last 10 years of which were with Merrill Lynch & Co, which included stints in Singapore, Hong Kong and Tokyo. He was a Director and Head of its Singapore Investment Banking Division prior to leaving Merrill Lynch (Singapore) Pte Ltd in late 2005. Mr Wong graduated with a Bachelor of Accountancy (Honours) from the National University of Singapore in 1990. He is a non-practising member of the Institute of Certified Public Accountants of Singapore. He holds the professional designation of Chartered Financial Analyst from the CFA Institute of the United States. A list of the present and past directorships of each Director of the Manager over the last five years preceding the Latest Practicable Date is set out in Appendix HList of Present and Past Principal Directorships of Directors and Executive Officers. Experience and expertise of the Board Each of Mr Lim Ho Seng, Mr Lok Vi Ming, Mr Tan Boon Leong and Mr Wong Mun Hoong have experience in being a director of a public listed company in Singapore. Ms Viven G. Sitiabudi has experience in being a President Commissioner of public listed companies in Indonesia. Indonesian companies are managed by a two-tiered management structure. The executive functions of an Indonesian company are run by a board of directors, which is supervised by a board of commissioners. They therefore have the appropriate experience to act as directors of the Manager and are familiar with the rules and responsibilities of a director of a public listed company. The Manager will arrange for the relevant training to prepare Mr Tan Bar Tien and Mr Yeo Cheow Tong for the roles and responsibilities of a director of the manager of a public listed REITsubsequent to the listing of LMIR Trust. The key roles of the Board The key roles of the Board are to: guide the corporate strategy and directions of the Manager; ensure that senior management discharges business leadership and demonstrates the highest quality of management skills with integrity and enterprise; and oversee the proper conduct of the Manager. The Board comprises seven Directors. The Audit Committee of the Board comprises Mr Tan Bar Tien, Mr Lim Ho Seng and Mr Lok Vi Ming. Mr Lim Ho Seng has been appointed as the Chairman of the Audit Committee. The Board shall meet to review the key activities and business strategies of the Manager. The Board intends to meet regularly, at least once every quarter, to deliberate the strategic policies of LMIR Trust, including acquisitions and divestments, approval of the annual budget and review of the performance of LMIR Trust. Each Director has been appointed on the basis of his professional experience and his potential to contribute to the proper guidance of LMIR Trust. The Directors will contribute in different ways, including using their personal networks to further the interest of LMIR Trust. The Board has the intention of approving a set of internal controls which sets out approval limits for capital expenditure, investments and divestments and bank borrowings as well as arrangements in relation to
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The Manager and corporate governance cheque signatories. In addition, sub-limits are also delegated to various management levels to facilitate operational efficiency. The members of the Boards Audit Committee will monitor changes to regulations and accounting standards closely. To keep pace with regulatory changes, where these changes have an important bearing on the Managers or Directors disclosure obligations, the Directors will be briefed either during Board meetings or at specially convened sessions involving the relevant professionals. The management will also provide the Board with complete and adequate information in a timely manner through regular updates on financial results, market trends and business developments. The majority of the Directors are non-executive. Further, three of the seven Directors are independent of the management. This enables the management to benefit from their external, diverse and objective perspective on issues that are brought before the Board. It would also enable the Board to interact and work with the management through a robust exchange of ideas and views to help shape the strategic process. This, together with a clear separation of the roles of the Chairman and the Chief Executive Officer, provides a healthy professional relationship between the Board and the management, with clarity of roles and robust oversight as they deliberate on the business activities of the Manager. The positions of Chairman of the Board and Chief Executive Officer are separately held by two persons in order to maintain an effective check and balance. The Chairman of the Board, Mr Tan Bar Tien, is an Independent Director, while the Chief Executive Officer, Ms Viven G. Sitiabudi, is an Executive Director of the Board. There is a clear separation of the roles and responsibilities between the Chairman and the Chief Executive Officer of the Manager. The Chairman is responsible for the overall management of the Board as well as ensuring that the members of the Board and the management work together with integrity and competency, and that the Board engages the management in constructive debate on strategy, business operations, enterprise risk and other plans while the Chief Executive Officer has full executive responsibilities over the business directions and operational decisions in the day-to-day management of the Manager. The Board has separate and independent access to senior management and the Company Secretary at all times. The Company Secretary attends to corporate secretarial administration matters and attends all Board meetings. The Board also has access to independent professional advice where appropriate and whenever requested.

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The Manager and corporate governance Management reporting structure of the Board
Board of Directors Tan Bar Tien Lim Ho Seng Lok Vi Ming Viven G. Sitiabudi Yeo Cheow Tong Tan Boon Leong Wong Mun Hoong (Chairman, Non-Executive and Independent Director) (Non-Executive and Independent Director) (Non-Executive and Independent Director) (Executive Director and Chief Executive Officer) (Non-Executive Director) (Non-Executive Director) (Non-Executive Director)

Chief Executive Officer Viven G. Sitiabudi

Chief Financial Officer / Investor Relations Manager / Compliance Officer Rudi Chuan Hwee Hiow

Asset Manager

Investment Manager

Andreas Kartawinata

Jeremy S. Walker

EXECUTIVE OFFICERS OF THE MANAGER The Executive Officers of the Manager are entrusted with the responsibility for the daily operations of the Manager. Roles of the Executive Officers of the Manager The Chief Executive Officer of the Manager will work with the Board to determine the strategy for LMIR Trust. He will also work with the other members of the Managers management team, such as the investment, asset management and financial personnel, in meeting the stated strategic, investment, and operational objectives of LMIR Trust. Additionally, the Chief Executive Officer will be responsible for planning the future strategic development and the day-to-day operations of LMIR Trust. The Chief Financial Officer / Investor Relations Manager / Compliance Officer of the Manager will work with the Chief Executive Officer and other members of the Managers management team to formulate strategic plans for LMIR Trust in accordance with the Managers stated investment strategy. The Chief Financial Officer / Investor Relations Manager / Compliance Officer will be responsible for applying the appropriate capital management strategy, overseeing implementation of LMIR Trusts shortand medium-term business plans and financial condition, as well as coordinating fund management activities. He is responsible for compliance issues concerning LMIR Trust in relation to the Listing Manual and the relevant Singapore laws and regulations. In the area of investor relations, he is responsible for
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The Manager and corporate governance facilitating communications and liaison with Unitholders. This includes statutory reporting, such as producing annual reports to Unitholders, and reporting to the SGX-ST in compliance with the Listing Manual. The principal objective of this role is to maintain continuous disclosure and transparent communications with Unitholders and the market. He is also tasked with the responsibility of promoting and marketing LMIR Trust to Unitholders, prospective investors and the media through regular communications, roadshows, events and a corporate website. The Asset Manager is responsible for formulating the business plans in relation to LMIR Trusts properties with short, medium and long-term objectives, and with a view to maximising the rental income of LMIR Trust via active asset management. The Asset Manager will work closely with the Property Manager to implement LMIR Trusts strategies so as to ensure that the properties in LMIR Trusts portfolio maximise their income generation potential and minimise their expense base without compromising their marketability. The Asset Manager will focus on the operations of LMIR Trusts properties, the implementation of the short to medium term objectives of LMIR Trusts portfolio and will supervise the Property Manager in the implementation of LMIR Trusts property-related strategies. The Investment Manager is responsible for identifying, researching and evaluating potential acquisitions and related investments with a view to enhancing LMIR Trusts portfolio or divestments where a property is no longer strategic, fails to enhance the value of LMIR Trusts portfolio or fails to be yield accretive. The Investment Manager also recommends and analyses potential asset enhancement initiatives. In order to support these various initiatives, the Investment Manager will develop financial models to test the financial impact of different courses of action. These findings will be research-driven to help develop and implement the proposed initiatives. Experience and Expertise of Executive Officers Information on the working experience of the executive officers of the Manager is set out below: Ms Viven G. Sitiabudi (See Directors of the ManagerExperience and Expertise of the Board of DirectorsMs Viven G.Sitiabudi.) Mr Rudi Chuan Hwee Hiow Mr Rudi Chuan Hwee Hiow is the Chief Financial Officer, the Investor Relations Manager and the Compliance Officer of the Manager. He has experience in corporate finance. Prior to joining the Manager in April 2007, he was the Senior Vice President (Finance & Accounting) with Macquarie Pacific Star Prime REIT Management Limited from March 2005. As the Senior Vice President, Mr Chuan was in charge of finance and finance-related duties, human resource, information technology as well as serving as the co-company secretary. From July 2000 to February 2005, Mr Chuan was a financial controller with a private property development company, Suntec City Development Pte. Ltd. From December 1995 to July 2000, Mr Chuan was a Senior Manager, Finance with NatSteel Chemicals Limited. From February 1990 to October 1995, Mr Chuan worked with Unilever Singapore Pte. Ltd., Mars Confectionary, Australia and Effem Foods Inc (a wholly-owned subsidiary of Mars Incorporated, USA). From January 1989 to January 1990, Mr Chuan was a Senior Accountant with a logistics company, Freight Links Express Ltd. From July 1986 to December 1988, Mr Chuan was a project analyst at a real estate company, United Industrial Corporation Ltd. As a project analyst, Mr Chuan was responsible for evaluating and making recommendations on potential take-over targets. Mr Chuan is a certified public accountant and has been a member of the Institute of Certified Public Accountants of Singapore since 1988. He graduated in 1981 from the University of Otago, New Zealand, with a Bachelor of Commerce degree in Accounting and holds a Masters degree in Business Administration from the State University of New York, Buffalo.
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The Manager and corporate governance Mr Andreas Kartawinata Mr Andreas Kartawinata is the Asset Manager of the Manager. Prior to joining PT Lippo Karawaci Tbk in February 2007, Mr Andreas Kartawinata was the Director of Leasing/Marketing and Operations with PT Metropolitan Kentjana Tbk where he was responsible for managing properties such as Pondok Indah Mall, Puri Indah Mall, Wisma Pondok Indah Office Tower, Apartment Golf Pondok Indah (service apartment), Pondok Indah Real Estate, Puri Indah Real Estate, and Bumi Shangrila Batam Real Estate. Under Mr Kartawinatas management, Pondok Indah Mall was awarded the Prix dExcellence (Retail Category) in 2006 by FIABCI, an international real estate federation. Mr Kartawinata was with PT Metropolitan Kentjana Tbk from June 1995. From June 1987 to May 1995, Mr Kartawinata held various positions with the Ometraco Group, including the position of a Leasing/Marketing manager with PT Schneider Ometraco, a joint venture between the Schneider Group (France) and the Ometraco Group. From August 1985 to June 1987, Mr Kartawinata was a Leasing/Marketing manager with PT Inti Datamas Sukses. Mr Kartawinata has over twenty years of experience in all phases of leasing, management, marketing and sales, including building a team of property professionals, market research, market planning, product management, advertising, promotion, sales and property management. Mr Kartawinata has been appointed as the President of the Association of Shopping Centres of Jakarta Indonesia for two consecutive periods, namely 2003-2007 and 2007-2010. Mr Kartawinata has participated in international events such as sitting as a panelist on the Council of Asian Shopping Centre Seminar in Malaysia (2005) and Indonesia (2006). Mr Kartawinata is also a part-time lecturer for retail business at Tarumanegara University Jakarta, Petra University Surabaya and Bina Retail Indonesia. Mr Kartawinata graduated from Institute Technology of Bandung with a major in Electro-technique Engineering. Mr Jeremy S. Walker Mr Jeremy S. Walker is the Investment Manager of the Manager. In December 2006, Mr Walker joined PT Lippo Karawaci Tbk as DirectorAsset Management. Having worked in the Australian property sector since 1990, Mr Walker has extensive experience in the Australian listed property trust market and has been involved in sharing his knowledge of international best practices with the Lippo Group. Prior to joining PT Lippo Karawaci Tbk, Mr Walker was the National DirectorRetail at Jones Lang LaSalle. During his 12 years at Jones Lang LaSalle, Mr Walkers experience covered many aspects of the retail property industry, spanning areas such as retail leasing, management and sales across all states of Australia. From 1995 to 1996, Mr Walker was the Retail Leasing Executive responsible for a portfolio of shopping centres and new projects. This included the successful repositioning of Wendouree Village Shopping Centre after major renovations. From 1998 to 1999, Mr Walker was the National Portfolio Manager with Jones Lang LaSalle for Schroders Australia. This included overall responsibility of asset management, marketing and leasing of six retail shopping centres in three states of Australia with a total value of around A$300 million. From 1999 to 2000, Mr Walker was the Manager of Investment Sales. Based in Melbourne and working with a national team of experts, Mr Walker was responsible for working with key clients to acquire and dispose assets in relation to retail shopping centres across Victoria and other parts of Australia. From 2000 to 2006, Mr Walker was responsible for the asset management and client relationship of many properties in Australia with an approximate value in excess of A$500 million, and represented various clients in the management, marketing and leasing of 16 shopping centres in Australia. Mr Walker provided advice on development, acquisition and divestment to institutional clients such as AMP Limited, Deutshe Bank along with other syndicated vehicles such as MCS and Australian Unity and private investors. Mr Walker is a licensed real estate agent in Australia and graduated with a degree in Bachelor of Business Property from RMIT University in 1998. He also graduated with a graduate Diploma in Business Administration from Mt. Eliza Business School, Australia in 2002.
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The Manager and corporate governance A list of the present and past directorships of each Executive Officer of the Manager over the last five years preceding the Latest Practicable Date is set out in Appendix HList of Present and Past Principal Directorships of Directors and Executive Officers.

Roles and responsibilities of the Manager The Manager has general powers of management over the assets of LMIR Trust. The Managers main responsibility is to manage LMIR Trusts assets and liabilities for the benefit of Unitholders. The Manager will set the strategic direction of LMIR Trust and give recommendations to the Trustee on the acquisition, divestment or enhancement of assets of LMIR Trust in accordance with its stated investment strategy. The Manager has covenanted in the Trust Deed to use its best endeavours to carry on and conduct its business in a proper and efficient manner; ensure that LMIR Trusts operations are carried on and conducted in a proper and efficient manner; and conduct all transactions with or for LMIR Trust at arms length and on normal commercial terms. Furthermore, the Manager will prepare property plans on a regular basis, which may contain proposals and forecasts on net income, capital expenditure, sales and valuations, explanations of major variances to previous forecasts, written commentary on key issues and any relevant assumptions. The purpose of these plans is to explain the performance of LMIR Trusts properties. The Manager will also be responsible for ensuring compliance with the applicable provisions of the SFA and all other relevant legislation, the Listing Manual, the CIS Code (including the Property Funds Guidelines), the Trust Deed, any tax ruling and all relevant contracts. The Manager will be responsible for all regular communications with Unitholders. The Manager may require the Trustee to borrow on behalf of LMIR Trust (upon such terms and conditions as the Manager deems fit, including the charging or mortgaging of all or any part of the Deposited Property) whenever the Manager considers, among other things, that such borrowings are necessary or desirable in order to enable LMIR Trust to meet any liabilities or to finance the acquisition of any property. However, the Manager must not direct the Trustee to incur a borrowing if to do so would mean that LMIR Trusts total borrowings and deferred payments exceed 35.0% of the value of its Deposited Property at the time the borrowing is incurred, taking into account deferred payments (including deferred payments for assets whether to be settled in cash or in Units). The Property Funds Guidelines allow a REIT to borrow more than 35.0% of the value of its Deposited Property (up to a maximum of 60.0%) only if a credit rating from Fitch Inc., Moodys or Standard & Poors is obtained and disclosed to the public. In the absence of fraud, negligence, wilful default or breach of the Trust Deed by the Manager, it shall not incur any liability by reason of any error of law or any matter or thing done or suffered to be done or omitted to be done by it in good faith under the Trust Deed. In addition, the Manager shall be entitled, for the purpose of indemnity against any actions, costs, claims, damages, expenses or demands to which it may be put as Manager, to have recourse to the Deposited Property or any part thereof save where such action, cost, claim, damage, expense or demand is occasioned by the fraud, negligence, wilful default or breach of the Trust Deed by the Manager. The Manager may, in managing LMIR Trust and in carrying out and performing its duties and obligations under the Trust Deed, with the written consent of the Trustee, appoint such person to exercise any or all of its powers and discretions and to perform all or any of its obligations under the Trust Deed, provided always that the Manager shall be liable for all acts and omissions of such persons as if such acts and omissions were its own.
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The Manager and corporate governance THE PROPERTY MANAGER OF LMIR Trust Management reporting structure of the Property Manager
Chairman Tjokro Libianto

Chief Executive Officer Yuke Elia Susiloputro

Chief Financial Officer Susanto

Asset Manager

Wilfredo Z. Pineda

Centre Managers

Heads of Department

Executive Officers of the Property Manager Information on the working experience of the Executive Officers of the Property Manager is set out below: Mr Tjokro Libianto Mr Tjokro Libianto is the Chairman of the Property Manager. He has many years of experience in property development as well as related regulatory requirements. He has been instrumental in negotiating most of the land acquisitions by the Lippo-related companies. He was formerly the Administrative and Finance Manager of PT Dwi Satya Utama in Surabaya as well as that of PT Tifa Finance and PT Tifa Securities. Mr Libianto holds a degree in Accountancy from Brawijaya University, Malang, Indonesia. Mr Yuke Elia Susiloputro Mr Yuke is the Chief Executive Officer of the Property Manager. He started his career as a design architect in Future Systems, Los Angeles, California from 1986 to 1988. From 1988 to 1992, he was the Associate Director of Glenwood L. Garvey & Associates, Santa Monica, California. Mr Yuke has extensive experience in property development. In 1992, he joined the Lippo Group to develop the first regional shopping centre in Cikarang, Bekasi, West Java and since then, he was actively involved in most of the Lippo Groups development of shopping centres in Indonesia. He also serves in the Indonesian Real Estate Association as Head of the New Township Development. In addition, he is the Chairman of the Indonesian Industrial Estate Association for Infrastructure Facilities Development. Presently, he is the President Director in the International Zone Area (Special Economic Zone), Bekasi, West Java, Indonesia.
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The Manager and corporate governance Mr Yuke graduated from the Southern California Institute of Architecture, Santa Monica, California in 1986 with a degree in Architecture. Mr Susanto Mr Susanto is the Chief Financial Officer of the Property Manager. He is an experienced finance and accounting professional who started his career as a Consultant at Prasetio Utomo & CoArthur Andersen Public Accountant Firm where his last position was as the Andersen World Wide Manager. He joined the Lippo-related companies in 2000 as a Finance & Accounting Division Head in PT Lippo Karawaci Tbk. In 2001, he was appointed Director of PT Lippo Cikarang Tbk and in August 2004, he was appointed Chief Controller of PT Lippo Karawaci Tbk. Mr Susanto holds an Accounting degree from STIE YAI, Jakarta, Indonesia. Mr Wilfredo Z. Pineda Mr Wilfredo Z. Pineda is the Asset Manager of the Property Manager. He joined PT Lippo Karawaci Tbk in December 2006 and is responsible for finance and accounting. Mr Pineda has 28 years of professional experience covering the areas of Corporate and Project Finance; Financial and Operation Audit; Financial Budgeting and Controlling; System Development and General Administration. His industry experiences include direct-to-home satellite pay television broadcasting; property development and management of hotel, shopping malls, office buildings, condominiums, membership clubs and real estate housing. Mr Pineda has 20 years experience in property development and management which includes his stint as Assistant Vice President Comptroller with Rockwell Land Corporation, a real estate development company in the Philippines, as Financial Controller and Management Advisor to PT Plaza Indonesia Realty Tbk, a property development and management company in Indonesia, and as Finance and Accounting Manager with PT. Bimantara Siti Wisesa, an Indonesian investment company. Mr Pineda holds a Bachelor of Science degree in Commerce with a major in Accounting from Holy Angel University, Philippines, and he is a Certified Public Accountant in the Philippines. MANAGEMENT FEES The Manager is entitled under the Trust Deed to the following management fees: (in respect of Authorised Investments which are in the form of real estate whether held directly by LMIR Trust or indirectly through one or more SPVs) a Base Fee of 0.25% per annum of the value of the Deposited Property and a Performance Fee of 4.00% per annum of LMIR Trusts NPI in the relevant financial year (calculated before accounting for the Performance Fee in that financial year); and (in respect of Authorised Investments which are not in the form of real estate whether held directly by LMIR Trust or indirectly through one or more SPVs) an Authorised Investment Management Fee of 0.5% per annum of the value of such Authorised Investments which, unless such Authorised Investment is an interest in a property fund (either a REIT or private property fund), wholly managed by a whollyowned subsidiary of the Sponsor in which case no Authorised Investment Management Fee shall be payable in relation to such Authorised Investment. For Forecast Period 2007, Projection Year 2008 and Projection Year 2009, the Manager has opted to receive 100% of the Performance Fee in the form of Units. The Manager may elect to receive the management fees in cash or Units or a combination of cash and Units (as it may in its sole discretion determine) after the Projection Year 2009, having regard to the distribution yields to Unitholders and the cash flow of LMIR Trust. Any increase in the rate above the maximum permitted level or any change in the structure of the Managers management fees must be approved by an Extraordinary Resolution of the Unitholders passed at a Unitholders meeting duly convened and held in accordance with the provisions of the Trust Deed.
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The Manager and corporate governance The Manager is also entitled to: (for any Authorised Investment acquired directly or indirectly from time to time by the Trustee on behalf of LMIR Trust) an acquisition fee of 1.0% of the purchase price in the case of any Authorised Investment acquired by LMIR Trust; and a divestment fee of 0.5% of the sale price (after deducting the interest of any co-owners or coparticipants) of any Authorised Investment sold directly or indirectly or divested from time to time by the Trustee on behalf of LMIR Trust. No acquisition fee is payable for the acquisition of the initial property portfolio of LMIR Trust. Any payment to third party real estate agents or brokers in connection with the acquisition or divestment of any Authorised Investment of LMIR Trust shall be paid by the Manager to such persons out of the Deposited Property of LMIR Trust or the assets of the relevant SPV, and not out of the acquisition fee or the divestment fee received or to be received by the Manager. The acquisition fee and the divestment fee are payable to the Manager in the form of cash and/or Units (as the Manager may elect in its sole discretion) at the then prevailing market price provided that in respect of any acquisition and sale or divestment of real estate assets from/to interested parties, such a fee should, if required by the applicable laws, rules and/or regulations, be in the form of Units issued by LMIR Trust at prevailing market price(s) and subject to such transfer restrictions as may be imposed. At present, the Property Funds Guidelines prescribe that such Units should not be sold within one year from date of their issuance. Any increase in the rate above the maximum permitted level or any change in the structure of the Managers acquisition fee or divestment fee must be approved by an Extraordinary Resolution of the Unitholders passed at a Unitholders meeting duly convened and held in accordance with the provisions of the Trust Deed. In relation to Authorised Investments in the form of real estate owned or held, or to be owned or held, either directly or indirectly, by a SPV, the fees payable to the Manager shall be calculated on the same basis as if such real estate, or the pro-rated share of such real estate in the case where the interest of LMIR Trust in the SPV is partial, had been held directly by the Trustee. ANNUAL REPORTS An annual report will be issued by the Manager to Unitholders within three months from the end of each financial year of LMIR Trust, containing, among other things, the following key items: (i) (ii) (iii) details of all real estate transactions entered into during the financial accounting period; details of LMIR Trusts real estate assets; if applicable, with respect to investments other than real property: (a) a brief description of the business; (b) proportion of share capital owned; (c) cost; (d) (if relevant) Directors valuation and in the case of listed investments, market value; (e) dividends received during the year (indicating any interim dividends); (f) dividend cover or underlying earnings;

(g) any extraordinary items; and (h) net assets attributable to investments; (iv) (v) (vi) (vii) cost of each property held by LMIR Trust; annual valuation of each property of LMIR Trust; analysis of provision for diminution in value of each property of LMIR Trust (to the extent possible); annual rental income for each property of LMIR Trust;
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The Manager and corporate governance (viii) (ix) (x) (xi) (xii) (xiii) (xiv) (xv) (xvi) occupancy rates for each property of LMIR Trust; remaining term for each of LMIR Trusts leasehold properties; amount of Distributable Income held pending distribution; details of assets other than real estate; details of LMIR Trusts exposure to derivatives; details of LMIR Trusts investments in other property funds; details of borrowings by the Trustee and other financial accommodation to the Trustee in relation to LMIR Trust; value of the Deposited Property and the NAV of LMIR Trust at the beginning and end of the financial year under review; the prices at which the Units were quoted at the beginning and end of the accounting period, and the highest and lowest prices at which the Units were traded on the SGX-ST during the financial accounting period; volume of trade in the Units during the accounting period; the aggregate value of all transactions entered into by the Trustee (for and on behalf of LMIR Trust) with an interested party (as defined in the Property Funds Guidelines) or with an interested person (as defined in the Listing Manual) during the financial year under review; total operating expenses of LMIR Trust in respect of the accounting period, including expenses paid to the Manager and interested parties (if any) and the Trustee, and taxation incurred in relation to LMIR Trusts properties; historical performance of LMIR Trust, including rental income obtained and occupancy rates for each property in respect of the accounting period and other various periods of time (e.g. one-year, three-year, five-year or 10-year) and any distributions made; total amount of fees paid to the Trustee; name of the manager of LMIR Trust, together with an indication of the terms and duration of its appointment and the basis of its remuneration; total amount of fees paid to the Manager and the price(s) of the Units at which they were issued in part payment thereof; an analysis of realised and unrealised surpluses or losses, stating separately profits and losses as between listed and unlisted investments, if applicable; and any extraordinary items.

(xvii) (xviii)

(xix)

(xx)

(xxi) (xxii) (xxiii) (xxiv) (xxv)

The first annual report will cover the period from the date of constitution of LMIR Trust to 31 December 2008. Additionally, the Manager has given an undertaking to the SGX-ST that it will announce LMIR Trusts NAV per Unit on a quarterly basis. Such announcements will be based on the latest available valuation of LMIR Trusts real estate and real estate-related assets, which the Manager has undertaken to conduct at least once a year. The first such valuation will be conducted by 31 December 2008. RETIREMENT OR REMOVAL OF THE MANAGER The Manager shall have the power to retire in favour of a corporation approved by the Trustee to act as the manager of LMIR Trust. Also, the Manager may be removed by notice given in writing by the Trustee if: the Manager goes into liquidation (except a voluntary liquidation for the purpose of reconstruction or amalgamation upon terms previously approved in writing by the Trustee) or a receiver is appointed over its assets or a judicial manager is appointed in respect of the Manager;
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The Manager and corporate governance the Manager ceases to carry on business; the Manager fails or neglects after reasonable notice from the Trustee to carry out or satisfy any material obligation imposed on the Manager by the Trust Deed; if the Unitholders by an Ordinary Resolution duly proposed and passed by Unitholders present and voting at a meeting of Unitholders convened in accordance with the Trust Deed, with no Unitholder (including the Manager and its Related Parties) being disenfranchised, vote to remove the Manager; for good and sufficient reason, the Trustee is of the opinion, and so states in writing, that a change of the Manager is desirable in the interests of the Unitholders; or the MAS directs the Trustee to remove the Manager. Where the Manager is removed on the basis that a change of the Manager is desirable in the interests of the Unitholders, the Manager has a right under the Trust Deed to refer the matter to arbitration. Any decision made pursuant to such arbitration proceedings is binding upon the Manager, the Trustee and all Unitholders. CORPORATE GOVERNANCE OF THE MANAGER The following outlines the main corporate governance practices of the Manager. Board of Directors of the Manager The Board is responsible for the overall corporate governance of the Manager including establishing goals for management and monitoring the achievement of these goals. The Manager is also responsible for the strategic business direction and risk management of LMIR Trust. All Board members will participate in matters relating to corporate governance, business operations and risks, financial performance, and the nomination and review of Directors. The Board will establish a framework for the management of the Manager and LMIR Trust, including a system of internal audit and control and a business risk management process. The Board consists of seven members, three of whom are Independent Directors. None of the Directors has entered into any service contract directly with LMIR Trust. The composition of the Board is determined using the following principles: the Chairman of the Board should be a non-executive Director; the Board should comprise Directors with a broad range of commercial experience including expertise in funds management, law, finance and the property industry; and at least one-third of the Board should comprise independent Directors. The composition will be reviewed regularly to ensure that the Board has the appropriate mix of expertise and experience. Audit Committee The Audit Committee is appointed by the Board from among the Directors and is composed of three members, a majority of whom (including the Chairman of the Audit Committee) are required to be independent Directors. As at the date of this Prospectus, the members of the Audit Committee are Mr Tan Bar Tien, Mr Lim Ho Seng and Mr Lok Vi Ming. Mr Lim Ho Seng has been appointed as the Chairman of the Audit Committee. All of them are independent Directors and resident in Singapore. The role of the Audit Committee is to monitor and evaluate the effectiveness of the Managers internal controls. The Audit Committee will review the quality and reliability of information prepared for inclusion in financial reports, and will be responsible for the nomination of external auditors and reviewing the adequacy of external audits in respect of cost, scope and performance. The Audit Committees responsibilities also include: monitoring the procedures established to regulate Related Party Transactions, including ensuring compliance with the provisions of the Listing Manual relating to interested person transactions (as defined therein) and the provisions of the Property Funds Guidelines relating to interested party
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The Manager and corporate governance transactions (as defined therein) (both such types of transactions constituting Related Party Transactions); monitoring the procedures in place to ensure compliance with applicable legislation, the Listing Manual and the Property Funds Guidelines; reviewing arrangements by which employees of LMIR Trust may, in confidence, raise concerns about possible improprieties in matters of financial reporting or other matters and ensuring that arrangements are in place for the independent investigation of such matters and for appropriate follow-up action; examining the effectiveness of financial, operating and compliance controls and risk management policies and systems at least annually; reviewing external audit reports to ensure that where deficiencies in internal controls have been identified, appropriate and prompt remedial action is taken by the management; reviewing the adequacy of external audits in respect of cost, scope and performance; making recommendations to the Board on the appointment, reappointment and removal of external auditors and approving the remuneration and terms of engagement of external auditors; reviewing, on an annual basis, the independence and objectivity of the external auditors and where the external auditors also provide a substantial volume of non-audit services to LMIR Trust, keeping the nature and extent of such services under review, seeking to balance the maintenance of objectivity and value for money; reviewing internal audit reports annually to ascertain that the guidelines and procedures established to monitor Related Party Transactions have been complied with; ensuring that the internal audit function is adequately resourced and has appropriate standing with LMIR Trust; ensuring, at least annually, the adequacy of the internal audit function; meeting with external and internal auditors, without the presence of the executive officers of the Manager, at least on an annual basis; reviewing the significant financial reporting issues and judgements so as to ensure the integrity of the financial statements of LMIR Trust and any formal announcements relating to LMIR Trusts financial performance; investigating any matters within the Audit Committees terms of reference, whenever it deems necessary; and reporting to the Board on material matters, findings and recommendations. Dealings in Units The Trust Deed requires each Director to give notice to the Manager of his acquisition of Units or of changes in the number of Units which he holds or in which he has an interest, within two Business Days after such acquisition or the occurrence of the event giving rise to changes in the number of Units which he holds or in which he has an interest (see The Formation and Structure of LMIR TrustThe Trust DeedDirectors Declaration of Unitholdings). All dealings in Units by Directors will be announced via SGXNET, with the announcement to be posted on the Internet at the SGX-ST website http://www.sgx.com The Directors and employees of the Manager are encouraged, as a matter of internal policy, to hold Units but are prohibited from dealing in the Units: in the period commencing one month before the public announcement of LMIR Trusts annual results and (where applicable) property valuations and two weeks before the public announcement of LMIR Trusts quarterly results, and ending on the date of announcement of the relevant results or, as the case may be, property valuations; and at any time while in possession of price sensitive information.
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The Manager and corporate governance The Directors and employees of the Manager are also prohibited from communicating price sensitive information to any person. In addition, the Manager has given an undertaking to the MAS that it will announce to the SGX-ST the particulars of its holdings in the Units and any changes thereto within two Business Days after the date on which it acquires or disposes of any Units, as the case may be. The Manager has also undertaken that it will not deal in the Units in the period commencing one month before the public announcement of LMIR Trusts annual results and (where applicable) property valuations and two weeks before the public announcement of LMIR Trusts quarterly results, and ending on the date of announcement of the relevant results or, as the case may be, property valuations. Management of business risk The Board will meet quarterly or more often if necessary and will review the financial performance of the Manager and LMIR Trust against a previously approved budget. The Board will also review the business risks of LMIR Trust, examine liability management and will act upon any comments from the auditors of LMIR Trust. The Manager has appointed experienced and well-qualified management personnel to handle the day-to-day operations of the Manager and LMIR Trust. In assessing business risk, the Board will consider the economic environment and risks relevant to the property industry. It will review management reports and feasibility studies on individual development projects prior to approving major transactions. The management will meet regularly to review the operations of the Manager and LMIR Trust and discuss any disclosure issues. Conflicts of interest The Manager has also instituted the following procedures to deal with conflicts of interest issues: The Manager will not manage any other REIT which invests in the same type of properties as LMIR Trust. All executive officers will be employed by the Manager. All resolutions in writing of the Directors in relation to matters concerning LMIR Trust must be approved by a majority of the Directors, including at least one Independent Director. At least one-third of the Board shall comprise Independent Directors. In respect of matters in which the Sponsor and/or its subsidiaries have an interest, direct or indirect, any nominees appointed by the Sponsor and/or its subsidiaries to the Board to represent its/their interests will abstain from voting. In such matters, the quorum must comprise a majority of the Independent Directors and must exclude nominee Directors of the Sponsor and/or its subsidiaries. In respect of matters in which MIPL and/or its subsidiaries have an interest, direct or indirect, any nominees appointed by MIPL and/or its subsidiaries to the Board to represent its/their interests will abstain from voting. In such matters, the quorum must comprise a majority of the Independent Directors and must exclude nominee Directors of MIPL and/or its subsidiaries. It is also provided in the Trust Deed that if the Manager is required to decide whether or not to take any action against any person in relation to any breach of any agreement entered into by the Trustee for and on behalf of LMIR Trust with a related party of the Manager, the Manager shall be obliged to consult with a reputable law firm (acceptable to the Trustee) which shall provide legal advice on the matter. If the said law firm is of the opinion that the Trustee, on behalf of LMIR Trust, has a prima facie case against the party allegedly in breach under such agreement, the Manager shall be obliged to take appropriate action in relation to such agreement. The Directors will have a duty to ensure that the Manager so complies. Notwithstanding the foregoing, the Manager shall inform the Trustee as soon as it becomes aware of any breach of any agreement entered into by the Trustee for and on behalf of LMIR Trust with a related party of the Manager and the Trustee may take such action as it deems necessary to protect the rights of Unitholders and/or which is in the interests of Unitholders. Any decision by the Manager not to
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The Manager and corporate governance take action against a related party of the Manager shall not constitute a waiver of the Trustees right to take such action as it deems fit against such related party. RELATED PARTY TRANSACTIONS The Managers internal control system The Manager will establish an internal control system to ensure that all future Related Party Transactions will be undertaken on normal commercial terms; and will not be prejudicial to the interests of LMIR Trust and the Unitholders. As a general rule, the Manager must demonstrate to its Audit Committee that such transactions satisfy the foregoing criteria, which may entail obtaining (where practicable) quotations from parties unrelated to the Manager, or obtaining one or more valuations from independent professional valuers (in accordance with the Property Funds Guidelines). The Manager will maintain a register to record all Related Party Transactions which are entered into by LMIR Trust and the bases, including any quotations from unrelated parties and independent valuations obtained to support such bases, on which they are entered into. The Manager will also incorporate into its internal audit plan a review of all Related Party Transactions entered into by LMIR Trust. The Audit Committee shall review the internal audit reports at least twice a year to ascertain that the guidelines and procedures established to monitor Related Party Transactions have been complied with. In addition, the Trustee will also have the right to review such audit reports to ascertain that the Property Funds Guidelines have been complied with. Furthermore, the following procedures will be undertaken: transactions (either individually or as part of a series or if aggregated with other transactions involving the same related party during the same financial year) equal to or exceeding S$100,000 in value but below 3.0% of the value of LMIR Trusts net tangible assets will be subject to review by the Audit Committee at regular intervals; transactions (either individually or as part of a series or if aggregated with other transactions involving the same related party during the same financial year) equal to or exceeding 3.0% but below 5.0% of the value of LMIR Trusts net tangible assets will be subject to the review and prior approval of the Audit Committee. Such approval shall only be given if the transactions are on normal commercial terms and are consistent with similar types of transactions made by the Trustee with third parties which are unrelated to the Manager; and transactions (either individually or as part of a series or if aggregated with other transactions involving the same related party during the same financial year) equal to or exceeding 5.0% of the value of LMIR Trusts net tangible assets will be reviewed and approved prior to such transactions being entered into, on the basis described in the preceding paragraph, by the Audit Committee which may, as it deems fit, request advice on the transaction from independent sources or advisers, including the obtaining of valuations from independent professional valuers. Furthermore, under the Listing Manual and the Property Funds Guidelines, such transactions would have to be approved by the Unitholders at a meeting of Unitholders duly convened and held in accordance with the provisions of the Trust Deed. Where matters concerning LMIR Trust relate to transactions entered into or to be entered into by the Trustee for and on behalf of LMIR Trust with a related party of the Manager (which would include relevant associates thereof) or LMIR Trust, the Trustee is required to consider the terms of such transactions to satisfy itself that such transactions are conducted on normal commercial terms; not prejudicial to the interests of LMIR Trust and the Unitholders; and in accordance with all applicable requirements of the Property Funds Guidelines and/or the Listing Manual relating to the transaction in question.
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The Manager and corporate governance Further, the Trustee has the discretion under the Trust Deed to decide whether or not to enter into a transaction involving a related party of the Manager or LMIR Trust. If the Trustee is to sign any contract with a related party of the Manager or LMIR Trust, the Trustee will review the contract to ensure that it complies with the requirements relating to interested party transactions in the Property Funds Guidelines (as may be amended from time to time) and the provisions of the Listing Manual relating to interested person transactions (as may be amended from time to time) as well as such other guidelines as may from time to time be prescribed by the MAS and the SGX-ST to apply to REITs. Save for the transactions described under Related Party Transactions in connection with the setting up of LMIR Trust and the Offering and Exempted Agreements, LMIR Trust will comply with Rule 905 of the Listing Manual by announcing any interested person transaction in accordance with the Listing Manual if such transaction, by itself or when aggregated with other interested person transactions entered into with the same interested person during the same financial year, is 3.0% or more of LMIR Trusts latest audited net tangible assets. The aggregate value of all Related Party Transactions which are subject to Rules 905 and 906 of the Listing Manual in a particular financial year will be disclosed in LMIR Trusts annual report for that financial year. Role of the Audit Committee for Related Party Transactions The Audit Committee will periodically review all Related Party Transactions to ensure compliance with the Managers internal control system and with the relevant provisions of the Listing Manual as well as the Property Funds Guidelines. The review will include the examination of the nature of the transaction and its supporting documents or such other data deemed necessary by the Audit Committee. If a member of the Audit Committee has an interest in a transaction, he is to abstain from participating in the review and approval process in relation to that transaction. Related Party Transactions in connection with the setting up of LMIR Trust and the Offering The Trustee, on behalf of LMIR Trust, has entered into a number of transactions with the Manager and certain related parties of the Manager in connection with the setting up of LMIR Trust and the Offering. These Related Party Transactions are as follows: The Trustee has entered into the Trust Deed with the Manager. The terms of the Trust Deed are generally described in The Formation and Structure of LMIR Trust. The Retail Space Indonesian SPCs, which will be indirectly owned by the Trustee as at the Listing Date, have entered into the Master Lease Agreements with the Master Lessee for the operation, maintenance, management and marketing of the Retail Spaces. These agreements are more particularly described in Certain Agreements Relating to LMIR Trust and the Properties Description of the Master Lease Agreements. The Manager considers that the Master Lessee has the necessary expertise and resources to perform the property management, lease management and marketing services for the Retail Spaces. Based on its experience, expertise and knowledge of contracts, the Manager believes that the Master Lease Agreements were made on normal commercial terms and are not prejudicial to the interests of LMIR Trust and the Unitholders. The Retail Mall Indonesian SPCs, which will be indirectly owned by the Trustee as at the Listing Date, have entered into the Operating Costs Agreements with the Operating Companies. This agreement is more particularly described in Certain Agreements Relating to LMIR Trust and the Properties Description of the Operating Costs Agreements. The Trustee has entered into the Singapore SPC Share Purchase Agreements with the Vendors for the acquisition of all the ordinary shares and redeemable preference shares in each of the Target Singapore SPCs. These agreements are more particularly described in Certain Agreements Relating to LMIR Trust and the PropertiesDescription of the Singapore SPC Share Purchase Agreements. The Trustee has also entered into the Deeds of Indemnity with Lippo Capital Limited pursuant to which
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The Manager and corporate governance Lippo Capital Limited will, subject to certain conditions, indemnify the Trustee against liabilities or damage suffered by the Trustee arising from any of the Singapore SPC Share Purchase Agreements. These agreements are more particularly described in Certain Agreements Relating to LMIR Trust and the PropertiesDescription of the Deeds of Indemnity. The Retail Mall Indonesian SPCs, which will be indirectly owned by the Trustee as at the Listing Date, have entered into the Existing Property Management Agreements with the Property Manager for the operation, management, maintenance and marketing of the Retail Malls. These agreements are more particularly described in Certain Agreements Relating to LMIR Trust and the PropertiesDescription of the Existing Property Management Agreements. The Manager considers that the Property Manager has the necessary expertise and resources to perform the retail management, lease management and marketing services for the Retail Malls. Based on its experience, expertise and knowledge of contracts, the Manager believes that the Existing Property Management Agreements were made on normal commercial terms and are not prejudicial to the interests of LMIR Trust and the Unitholders. The Trustee, the Manager and the Property Manager have entered into the Master Property Management Agreement pursuant to which the Property Manager was appointed to operate, maintain, manage and market all the properties of LMIR Trust located in Indonesia acquired after the Listing Date, subject to the overall management of the Manager. This agreement is more particularly described in Certain Agreements Relating to LMIR Trust and the PropertiesDescription of the Master Property Management Agreement. The Manager considers that the Property Manager has the necessary expertise and resources to perform the operation, maintenance, management and marketing services for the properties of LMIR Trust located in Indonesia acquired after the Listing Date. Based on its experience, expertise and knowledge of contracts, the Manager believes that the Master Property Management Agreement was made on normal commercial terms and is not prejudicial to the interests of LMIR Trust and the Unitholders. Save as disclosed in this Prospectus, the Trustee has not entered into any other transactions with the Manager or any related party of the Manager or the Property Manager in connection with the setting up of LMIR Trust. Exempted agreements The Master Lease Agreements, the Operating Costs Agreements, the Existing Property Management Agreements and the Master Property Management Agreement, each of which constitutes a Related Party Transaction, is deemed to have been specifically approved by the Unitholders upon subscription for the Units and are therefore not subject to Rules 905 and 906 of the Listing Manual to the extent that there is no subsequent change to the rates and/or bases of the fees charged thereunder which will adversely affect LMIR Trust. However, the renewal of such agreements will be subject to Rules 905 and 906 of the Listing Manual. Future Related Party Transactions As a REIT, LMIR Trust is regulated by the Property Funds Guidelines and the Listing Manual. The Property Funds Guidelines regulate, among other things, transactions entered into by the Trustee (for and on behalf of LMIR Trust) with an interested party relating to LMIR Trusts acquisition of assets from or sale of assets to an interested party, LMIR Trusts investment in securities of or issued by an interested party and the engagement of an interested party as property management agent or marketing agent for LMIR Trusts properties. Depending on the materiality of transactions entered into by LMIR Trust for the acquisition of assets from, the sale of assets to or the investment in securities of or issued by, an interested party, the Property Funds Guidelines may require that an immediate announcement to the SGX-ST be made, and may also require that the approval of the Unitholders be obtained. The Listing Manual regulates all interested person transactions, including transactions already governed by the Property Funds Guidelines. Depending on the materiality of the transaction, LMIR Trust may be
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The Manager and corporate governance required to make a public announcement of the transaction (Rule 905 of the Listing Manual), or to make a public announcement of and to obtain Unitholders prior approval for the transaction (Rule 906 of the Listing Manual). The Trust Deed requires the Trustee and the Manager to comply with the provisions of the Listing Manual relating to interested person transactions as well as such other guidelines relating to interested person transactions as may be prescribed by the SGX-ST to apply to REITs. The Manager may seek a general annual mandate from the Unitholders pursuant to Rule 920(1) of the Listing Manual for recurrent transactions of a revenue or trading nature or those necessary for its day-to-day operations, including a general mandate in relation to leases and/or licence agreements to be entered into with interested persons. All transactions conducted under such general mandate for the relevant financial year will not be subject to the requirements under Rules 905 and 906 of the Listing Manual. In seeking such a general annual mandate, the Trustee will appoint an independent financial adviser (without being required to consult the Manager) pursuant to Rule 920(1)(b)(v) of the Listing Manual to render an opinion as to whether the methods or procedures for determining the transaction prices of the transactions contemplated under the annual general mandate are sufficient to ensure that such transactions will be carried out on normal commercial terms and will not be prejudicial to the interests of LMIR Trust and the Unitholders. The Property Funds Guidelines and the Listing Manual requirements would have to be complied with in respect of a proposed transaction which is prima facie governed by both sets of rules. Where matters concerning LMIR Trust relate to transactions entered or to be entered into by the Trustee for and on behalf of LMIR Trust with a related party (either an interested party under the Property Funds Guidelines or an interested person under the Listing Manual) of the Manager or LMIR Trust, the Trustee is required to ensure that such transactions are conducted in accordance with applicable requirements of the Property Funds Guidelines and/or the Listing Manual relating to the transaction in question. The Manager is not prohibited by either the Property Funds Guidelines or the Listing Manual from contracting or entering into any financial, banking or any other type of transaction with the Trustee (when acting other than in its capacity as trustee of LMIR Trust) or from being interested in any such contract or transaction, provided that any such transaction shall be on normal commercial terms and is not prejudicial to the interests of LMIR Trust and the Unitholders. The Manager shall not be liable to account to the Trustee or to the Unitholders for any profits or benefits or other commissions made or derived from or in connection with any such transaction. The Trustee shall not be liable to account to the Manager or to the Unitholders for any profits or benefits or other commission made or derived from or in connection with any such transaction.

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The Sponsor
In July 2004, the Sponsor was formed from a merger of eight property-related companies. The Sponsor is an internationally recognised corporation and is also the largest listed property company in Indonesia, based on its market capitalisation on the JSX of Rp. 10,609.2 billion (approximately S$1.8 billion) based on the closing price of Rp. 1,790.0 on the JSX as at 18 October 2007. The Sponsor develops residential, commercial and retail properties, and light industrial areas throughout Indonesia, with the majority of its current developments based in and around Greater Jakarta. The Sponsors property portfolio comprises townships and residential developments, commercial and retail development projects, healthcare, hospitality and infrastructure. It has three townships and one residential cluster as well as eight developed commercial and retail centres. It manages four hospitals, one of which it owns. In addition, it owns three hotels, two of which it also manages. The merger strengthened recurring cash flows, achieved economies of scale and reduced exposure to business cycles. As a result of the merger, all assets and liabilities of the merged companies became the Sponsors assets and liabilities. The effect of the merger was to expand the Housing and Land Development business segment as well as to increase the Sponsors market capitalisation. Since the merger, the Sponsor has established itself as the largest property developer in Indonesia with a strong recurring income base. The Sponsor is listed on the JSX and the SSX in Indonesia. It is also included in the LQ 45 Index, which is a capitalisation-weighted index of the 45 most heavily traded stocks on the JSX. In November 2005, Euromoney conferred two awards on the Sponsor, naming it the Best Property Developer in Indonesia as well as placing it among the top 10 property developers in the Asia-Pacific region. Subsequently in July 2006, the Sponsor received, from Businessweek Magazine, the Indonesias Most Admired Company (IMAC) 2006 award in the category of property developers. The methodologies applied by Euromoney on the rating survey were (i) creativity of the developer in composing product and ability to create investment opportunities, (ii) quality of the products, and (iii) financial ability. Inputs from commercial banks, investment banks and real estate advisers were taken into consideration when determining the award recipient. The Sponsor is staffed by experienced professionals, all of whom have in-depth property management and operating experience.

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The Sponsor The business structure of the Sponsor comprises the following three main aspects: HEALTHCARE The Sponsor owns Siloam Hospitals Lippo Cikarang and manages four hospitals being, Siloam Hospitals Lippo Cikarang, Siloam Hospitals Lippo Karawaci, Siloam Hospitals West Jakarta and Siloam Hospitals Surabaya, with a total 591 operational beds, and a maximum bed capacity of 835, located in Jakarta, Greater Jakarta and Surabaya. Specialist medical services offered include complex surgical procedures, laboratory, radiology and imaging, general healthcare and emergency services. In its hospitals, the Sponsor has developed centres of excellence1 in various areas of healthcare which are recognised as providing premium healthcare services in Indonesia. HOSPITALITY AND INFRASTRUCTURE The Sponsor manages hotel operations and operates a number of restaurants and other facilities located around Indonesia. The Sponsor has developed over 280 km of roads, water treatment plants, traffic control services, in addition to four hotels with a total of over 800 rooms and a 2,125 sq m food court. The Sponsor also provides quality urban management services such as security, water and sewage treatment, daily garbage collection, health and hygiene services, landscape, roads and drains maintenance and public transportation services to the residents of Lippo Karawaci, Lippo Cikarang and Tanjung Bunga urban developments. This provision of high quality, privately operated and commercially-run urban management is unique in Indonesia. HOUSING AND LAND DEVELOPMENT This business aspect deals with the urban development of residential, commercial, retail and industrial real estate. Starting in 1993 with the development of the Lippo Karawaci urban development and subsequent Lippo Cikarang and Tanjung Bunga urban developments, the Sponsor has pioneered the development of Edge Cities in Indonesia. Edge Cities are designed and constructed with all necessary infrastructure to establish self-contained cities beyond the boundaries of larger cities, in the case of Lippo Karawaci and Lippo Cikarang, to the west and east of Jakarta, respectively. The Sponsor is internationally recognised and has won awards for such Edge Cities developments. These three urban developments have a combined population of more than 70,000 residents, 20,000 homes and employ more than 120,000 workers. In addition, the Sponsor owns eight commercial and retail centres, amounting to over 250,000 sq m of saleable area and 40,000 sq m of retail space available for leasing. The Sponsors total revenue was Rp. 1,905.0 billion (approximately S$330.2 million) in the financial year ended 31 December 2006. Its market capitalisation on the JSX was Rp. 10,609.2 billion (approximately S$1.8 billion) based on the closing price per ordinary share on the JSX of Rp. 1,790.0 as at 18 October 2007. 50.0% of its revenue in 2006 was derived from recurring income (including rental income from its residential, commercial and retail, and revenues from the operation of five medical facilities and operation of its hotels. 50.0% of its revenue in 2006 was derived from development income (including the development and sale of residential, commercial and retail and light industrial properties). The table below, which was prepared based on Indonesian generally accepted accounting principles, sets forth the unaudited consolidated revenues, generated by each of the Sponsors Housing and Land Development, Healthcare and Hospitals as well as Hospitality and Infrastructure business segments in the period indicated. The consolidated revenues shown in the table below have been translated for convenience and as a matter of arithmetical computation only. The consolidated revenue is translated at an average rate of Rp. 5,770 per S$1.00. Such translations should not be construed as a representation that the Singapore dollar amounts could be converted into Indonesian Rupiah at the above rate or other rate.
1

Centres of excellence is a term used by the Sponsor to describe a particular area of medical specialisation, proficiency and excellence, with the relevant specialist doctors, nursing staff and state-of-the-art medical equipment and facilities, at a hospital.

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The Sponsor
Financial year ended 31 December 2006 (Rp. millions) (S$000) (%)

Housing and Land Development . Healthcare . . . . . . . . . . . . . . . . . . . Hospitality and Infrastructure . . . Total . . . . . . . . . . . . . . . . . . . . . . .

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.. .. .. ..

.. .. .. ..

. . . .

952,246 573,496 379,588 1,905,330

165,034 99,393 65,786 330,213

50.0 30.1 19.9 100.0

A formal credit rating on the Sponsor has been carried out by various credit rating agencies. The Sponsor was rated B1 by Moodys and B+ by Standard & Poors. As at 31 March 2007, the Sponsor has completed eight commercial and retail development projects with a total GFA of 581,740 sq m and has six commercial and retail development projects under development with an estimated total GFA of approximately 483,060 sq m. Significant projects that have already been developed or are currently being developed by the Sponsor include: Lippo Karawaci township, located in Lippo Karawaci, Greater Jakarta (see profile below); Lippo Cikarang township located in Lippo Cikarang, Greater Jakarta (see profile below); Tanjung Bunga located in Makassar (see profile below); Puncak Resort International, a 60-ha development located in Cipanas, West Java, consisting of 480 villas and unique sports, recreation and meeting facilities; Metropolis Town Square, a three-level strata mall located in Tangerang, an industrial and manufacturing city in Greater Jakarta; Mall WTC Matahari, a five-level strata mall located within the proximity of the Bumi Serpong Damai residential estate, the largest residential estate in Greater Jakarta; GTC Makassar, a four-level strata mall located in Makassar, South Sulawesi; Malang Town Square, a three-level strata mall located in Malang, the second largest city in the East Java province; Depok Town Square, a five-level strata mall located in Depok and next to the University of Indonesia, the biggest university in Greater Jakarta; Grand Palladium Medan, a six-level strata mall located in Medan, a city renowned as a growing commercial centre in the North Sumatra province; City of Tomorrow, a four-level retail mall, five-storey office tower, 17-storey residential tower and eightstorey hotel, located in Surabaya, East Java; Puri Paragon City, a mixed-used development located in West Jakarta comprising a retail mall, residential apartments, a school, and a hotel; Kemang Village located in South Jakarta, offering enjoyable views of both the river and the scenic Pangeran Antasari Street; Bellanova Country Mall, a one-level strata mall opened in July 2005 and located in Sentul, Greater Jakarta; Binjai Supermall, a two-level retail mall located in Binjai, North Sumatra (see Business and PropertiesAcquisition Pipeline); and Pejaten Mall, a retail mall located in South Jakarta (see Business and PropertiesAcquisition Pipeline). The Lippo Karawaci urban development was the Sponsors first significant project which commenced construction in 1993 and is located approximately 30 km west of central Jakarta. The development currently has a population of approximately 40,000 residents and has been developed on an area of approximately 1,032 ha of land. It includes 11,257 homes, shophouses and four apartment/condominium towers with a total of 1,146 units. The development has become a regional centre for office properties,
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The Sponsor shopping, entertainment and recreation (with a five-star hotel, a resort and a 67-ha golf course). Notable establishments within the Lippo Karawaci urban development include Siloam Hospitals Lippo Karawaci, the Pelita Harapan University and an internationally accredited English language educational institution offering preschool through secondary school facilities. More than 108 km of roads were built by the Sponsor within the development. The Sponsor has developed and operated urban developments at Lippo Cikarang located in the east of Jakarta and Tanjung Bunga in Makassar, respectively. Lippo Cikarang was launched in 1993 and Tanjung Bunga in 1996. The Sponsor also developed the Royal Serpong Village, a gated micro-suburb at Serpong located to the west of Jakarta, which includes a secure and exclusive 150-home residential development. In 2002, the Sponsor launched its first retail strata-titled project, Mall WTC Matahari, a retail shopping mall located in Greater Jakarta. Since that time, it has developed the retail and commercial properties of Metropolis Town Square in Modernland, Greater Jakarta; Depok Town Square in Depok, Greater Jakarta; Malang Town Square in Malang, East Java; GTC Makassar in Makassar, South Sulawesi and Medan Grand Palladium Medan in Medan, North Sumatra. As at 31 December 2006, the Sponsor has approximately 2,046 ha of land available for future township development, in addition to land banks for future commercial retail development, which is among the largest landbanks among all Indonesian property companies. This is anticipated to be sufficient for the Sponsors planned development projects for the next 15 to 20 years. The significant size of its landbank provides the Sponsor with the flexibility to develop or divest areas of land to take advantage of cyclical property market conditions and reduces its exposure to the complexities of land acquisitions in Indonesia. The Sponsor has formulated the following strategies for its property business, especially its retail property business: Expansion of portfolios in strategic locations. For the past three years, the Sponsor has acquired key sites in strategic locations to build retail malls and other mixed use developments such as residential towers, hospitals and hotels. These developments include Puri Paragon in West Jakarta, Kemang Village in South Jakarta and Kuta Beach Mall in Bali. The Sponsor will continue to seek opportunities to acquire new sites for future developments. Continuing strong relations with business partners. The Sponsor has established and continues to maintain strong relations with its network of business partners and other business groups and has gained their trust and confidence. Experienced key personnel. The Sponsor has strong industry experience and established track record. Its management team, through a combination of local knowledge and global experience, will continue to strive towards international best practice by attracting and developing its key people. Asset enhancement. The Sponsor has planned ongoing asset enhancements on the malls which it owns and/or manages. This includes the constant upkeep and improvement of all Retail Malls. The Sponsor is aware of the need to continuously monitor and improve retail properties in a dynamic global environment. Leverage its broad based property development experience and platform. The Sponsor will leverage its wide ranging property development capabilities and platform to consistently source for new retail developments and third party acquisition opportunities. Tenant relationship. The Sponsor values its tenants as key stakeholders in the growth and success of itself, its subsidiaries, their business associates and controlled affiliates. It has established and will continue to build greater relationships to drive both the Sponsors as well as LMIR Trusts success. (See Business and PropertiesAcquisition Pipeline.)
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The Sponsor LOCATION OF DEVELOPMENTS The following map shows, as at 31 December 2006, the geographic distribution of the Sponsors developments in Indonesia. Its operations are located in diverse and the more economically developed regions of Indonesia.

The following map shows, as at 31 December 2006, the geographic distribution of the Sponsors developments in Greater Jakarta. The Sponsors significant presence in the property market in Jakarta and the surrounding areas demonstrates its belief that these areas offer high consumer demand which are currently under-served.

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The Sponsor KEY SHAREHOLDERS OF THE SPONSOR Lippo-related companies In 1990, the Riady family founded PT. Tunggal Reksa Kencana which was subsequently merged with LLD, PT. Siloam Healthcare Tbk, PT. Aryaduta Hotels Tbk, PT. Kartika Abadi Sejahtera, PT. Sumber Waluyo, PT. Ananggadipa Berkat Mulia and PT. Metropolitan Tatanugraha to form the Sponsor. The Riady family currently has an indirect shareholding in the Sponsor through various companies, including Pacific Asia Holdings Ltd and other Lippo-related companies which collectively hold 25.63% of the Sponsor. Pacific Asia Holdings Ltd holds 13.95% of the Sponsor, and none of the other Lippo-related companies individually hold more than 5.0% of the Sponsor. The Lippo-related companies are involved in retail, telecommunications, entertainment, multimedia and financial services. Benefits that the Lippo-related companies bring to the Sponsor are synergies with other group entities including, but not limited to, Matahari retail stores, hypermarkets and Timezone amusement centres. These companies take an interest, as shareholders, in the performance of the Sponsor. China Resources group of companies The China Resources group of companies beneficially own 15.42% of the Sponsor through a subsidiary, Greatmind Investments Limited. The China Resources group of companies is a Chinese government-owned conglomerate with diverse and substantial investments and operations in the PRC, Hong Kong and Asia. It is also one of the leading property developers in the PRC, having developed nearly 50 real estate projects, including the Xidan commercial area, Dongguanying residential area, Jiangongnanli residential area and Sunny Up town. It also has substantial businesses in food products, retailing, infrastructure and trading. Listed entities under its stable include China Resources Enterprise, China Resources Land, China Resources Logic, China Resources Cement Holdings, China Resources Power Holdings Co. and China Resources Peoples Telephone Co. The China Resources group of companies benefit the Sponsor by providing its vast experience in property development, institutionalising better business practices and providing support for future capital raising. CP Inlandsimmobilien Holding Gmbh (CPIHG) CPIHG owns 7.75% of the Sponsor beneficially through its wholly-owned subsidiary, Capital Bloom Investment Limited. CPIHG, which is mandated to invest in properties in developing countries, is the investment banking real estate arm of Austrias Raiffeisen Bank, which was established in 1990 and, as at the date of this Prospectus, has 15 subsidiaries in Austria. The public owns the remaining 51.2% of the Sponsor, as at the Listing Date. SOLE FINANCIAL ADVISER TO THE SPONSOR: PT. CIPTADANA CAPITAL PT. Ciptadana Capital is an Indonesian-incorporated company which undertakes predominantly investment banking activities, and owns various subsidiary companies dealing in, among others, securities, asset management and multifinance. It is the sole financial adviser to the Sponsor and assists the Sponsor in, among other things, the structuring of the Offering, the provision of information and data relating to the Properties and the Sponsor, and liaising with Indonesian regulators and professional advisers.

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The formation and structure of LMIR Trust

The Trust Deed is a complex document and the following is a summary only and is qualified in its entirety by, and is subject to, the contents of the Trust Deed. Investors should refer to the Trust Deed itself to confirm specific information or for a detailed understanding of LMIR Trust. The Trust Deed is available for inspection at the registered office of the Manager at 78 Shenton Way, #05-01 Lippo Centre, Singapore 079120. THE TRUST DEED LMIR Trust is a REITconstituted by the Trust Deed which was entered into on 8 August 2007 (as amended by a first supplemental deed dated 18 October 2007) between the Trustee and the Manager, and is principally regulated by the SFA and the CIS Code (including the Property Funds Guidelines). The terms and conditions of the Trust Deed shall be binding on each Unitholder (and persons claiming through such Unitholder) as if such Unitholder had been a party to the Trust Deed and as if the Trust Deed contains covenants by such Unitholder to observe and be bound by the provisions of the Trust Deed and an authorisation by each Unitholder to do all such acts and things as the Trust Deed may require the Manager and/or the Trustee to do. Operational structure LMIR Trust is a Singapore-based REIT constituted by the Trust Deed. It is established with the principal investment objective of owning and investing on a long-term basis in a diversified portfolio of incomeproducing real estate in Indonesia that are primarily used for retail and/or retail-related purposes, and real estate related assets in connection with the foregoing purposes. LMIR Trust aims to generate returns for its Unitholders by owning, buying and actively managing such properties in line with its investment strategy, including the divestment of any property that is identified by the Manager at any time, to have limited scope for growth. Subject to the restrictions and requirements in the Property Funds Guidelines and the Listing Manual, the Manager is also authorised under the Trust Deed to invest in investments which need not be real estate. Although the Manager may use certain financial derivative instruments for hedging purposes or efficient portfolio management provided that such financial derivative instruments are not used to gear LMIR Trusts overall investment portfolio or are intended to be borrowings of LMIR Trust, the Manager presently does not have any intention to invest in options, warrants, commodities, futures contracts, unlisted securities and precious metals. For further details of the investment objectives and policies of the Manager, see Clause 10.2 of the Trust Deed. The Units and Unitholders The rights and interests of Unitholders are contained in the Trust Deed. Under the Trust Deed, these rights and interests are safeguarded by the Trustee. Each Unit represents an undivided interest in LMIR Trust. A Unitholder has no equitable or proprietary interest in the underlying assets of LMIR Trust and is not entitled to the transfer to it of any asset (or any part thereof) or of any real estate, any interest in any asset and real estate-related assets (or any part thereof) of LMIR Trust. A Unitholders right is limited to the right to require due administration of LMIR Trust in accordance with the provisions of the Trust Deed, including, without limitation, by suit against the Trustee or the Manager. Under the Trust Deed, each Unitholder acknowledges and agrees that it will not commence or pursue any action against the Trustee or the Manager seeking an order for specific performance or for injunctive relief in respect of the assets of LMIR Trust (or any part thereof), including all its Authorised Investments (as defined in the Trust Deed), and waives any rights it may otherwise have to such relief. If the Trustee or the Manager breaches or threatens to breach its duties or obligations to the Unitholder under the Trust Deed, the Unitholders recourse against the Trustee or the Manager is limited to a right to recover damages or
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The formation and structure of LMIR Trust compensation from the Trustee or the Manager in a court of competent jurisdiction, and the Unitholder acknowledges and agrees that damages or compensation is an adequate remedy for such breach or threatened breach. Further, unless otherwise expressly provided in the Trust Deed, a Unitholder may not interfere or seek to interfere with the rights, powers, authority or discretion of the Manager or the Trustee, exercise any right in respect of the assets of LMIR Trust or any part thereof or lodge any caveat or other notice affecting the real estate assets and real estate-related assets of LMIR Trust (or any part thereof), or require that any Authorised Investments forming part of the assets of LMIR Trust be transferred to such Unitholder. No certificate shall be issued to Unitholders by either the Manager or the Trustee in respect of Units issued to Unitholders. For so long as LMIR Trust is listed, quoted and traded on the SGX-ST and/or any other Recognised Stock Exchange and the Units have not been suspended from such listing, quotation and trading for more than 60 consecutive calendar days or de-listed permanently, the Manager shall pursuant to the Depository Services Agreement dated 10 August 2007 entered into between CDP , the Manager and the Trustee, appoint CDP as the Unit depository for LMIR Trust, and all Units issued will be represented by entries in the register of Unitholders kept by the Trustee or the agent appointed by the Trustee in the name of, and deposited with, CDP as the registered holder of such Units. The Manager or the agent appointed by the Manager shall issue to CDP not more than 10 Business Days after the issue of Units a confirmation note confirming the date of issue and the number of Units so issued and, if applicable, also stating that the Units are issued under the First Lock-Up Period and the Second Lock-Up Period and the expiry date of such lock-up and for the purposes of the Trust Deed, such confirmation note shall be deemed to be a certificate evidencing title to the Units issued. The MAS has announced on 8 June 2007 the decision of the Securities Industry Council to extend the ambit of the Take-over Code to REITs. While the MAS will be making amendments to the SFA and the Take-over Code, where necessary, to give effect to the extension of the Take-over Code to REITs in due course, the Securities Industry Council has recommended that parties engaged in take-over or merger transactions involving REITs comply with the Take-over Code prior to such amendments. Under the Take-over Code, any person acquiring an interest, either individually or with parties acting in concert, in 30.0% or more of the Units (being voting units in LMIR Trust) may be required to extend a takeover offer for the remaining Units in accordance with the Take-over Code. A take-over offer is also required to be made if a person holding between 30.0% and 50.0% inclusive of the Units, either individually or in concert, acquires an additional 1.0% of the Units in any six-month period under the Take-over Code. Issue of Units The following is a summary of the provisions of the Trust Deed relating to the issue of Units in LMIR Trust. Subject to the following sub-paragraphs (1), (2) and (3) below and to such laws, rules and regulations as may be applicable, for so long as LMIR Trust is listed on the SGX-ST or any other Recognised Stock Exchange, the Manager may issue Units on any Business Day at an Issue Price equal to the market price, without the prior approval of Unitholders in a Unitholders meeting duly convened and held in accordance with the provisions of the Trust Deed. For this purpose, market price shall mean (i) the volume weighted average price for a Unit for all trades on the SGX-ST, or such other Recognised Stock Exchange on which the LMIR Trust is listed, in the ordinary course of trading on the SGX-STor, as the case may be, such other Recognised Stock Exchange, for the period of 10 Business Days (or such other period as may be prescribed by the SGX-STor relevant Recognised Stock Exchange) immediately preceding the relevant Business Day; or (ii) if the Manager believes that the calculation in paragraph (i) above does not provide a fair reflection of the market price of a Unit, an amount as determined by the Manager and the Trustee (after consultation with a stockbroker approved by the Trustee), as being the fair market price of a Unit. (1) The Manager shall comply with the rules in the Listing Manual in determining the Issue Price per Unit, including the Issue Price per Unit for a rights issue on a pro rata basis to all existing Unitholders, the Issue Price per Unit issued other than by way of a rights issue offered on a pro rata basis to all existing Unitholders and the Issue Price per Unit for any reinvestment or distribution arrangement.
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The formation and structure of LMIR Trust (2) Where Units are issued as full or partial consideration for the acquisition of an Authorised Investment by LMIR Trust in conjunction with an issue of Units to raise cash for the balance of the consideration for the said Authorised Investment (or part thereof) or to acquire other Authorised Investments in conjunction with the said Authorised Investment, the Manager shall have the discretion to determine that the Issue Price of a Unit so issued as partial consideration shall be the same as the Issue Price for the Units issued in conjunction with an issue of Units to raise cash for the aforesaid purposes. Following the new Rule 887 of the Listing Manual which came into effect on 1 September 2006, the Manager may issue new Units without the prior approval of Unitholders in a general meeting if the issue (together with any other issue of Units in the same financial year) would not exceed 10.0% of the Units in issue. The scope of the general mandate to be given in a general meeting of the Unitholders is limited to the issue of an aggregate number of additional Units which must not exceed 50.0% of the total number of Units in issue, of which the aggregate number of additional Units to be issued other than on a pro rata basis to the existing Unitholders must not exceed 20.0% of the total number of Units in issue. The first financial period of LMIR Trust will commence on 8 August 2007, being the date of its constitution, and end on 31 December 2007. By purchasing the Units under the Offering, investors are deemed to have given the Manager the above general mandate to issue new Units, to be automatically renewed on an annual basis, with the effective date of renewal being the start of LMIR Trusts financial year, subject to revocation or variation by ordinary resolution of Unitholders in general meeting pursuant to Rule 887(3)(b) of the Listing Manual. If in connection with an issue of a Unit, any requisite payment of the Issue Price for such Unit has not been received by the Trustee before the seventh Business Day after the Unit was agreed to be issued (or such other date as the Manager and the Trustee may agree), the Manager may cancel its agreement to issue such Unit and upon notice being given to the Trustee, such Unit will be deemed never to have been issued or agreed to be issued. In such an event, the Manager may, at its discretion, charge the investor (and retain the same for its own account) (i) a cancellation fee of such amount as the Manager may from time to time determine to represent the administrative costs involved in processing the application for such Unit, and (ii) an amount (if any) by which the Issue Price of such Unit exceeds the repurchase price applying if such Unit was requested to have been repurchased or redeemed on the same day. Suspension of issue of Units The Manager or the Trustee may, with the prior written approval of the other and subject to the Listing Manual, suspend the issue of Units during: any period when the SGX-ST or any other relevant Recognised Stock Exchange is closed (otherwise than for public holidays) or during which dealings are restricted or suspended; the existence of any state of affairs which, in the opinion of the Manager or the Trustee (as the case may be), might seriously prejudice the interests of the Unitholders as a whole or the Deposited Property; any breakdown in the means of communication normally employed in determining the price of any assets of LMIR Trust or the current price thereof on the SGX-STor any other relevant Recognised Stock Exchange, or when for any reason the prices of any assets of LMIR Trust cannot be promptly and accurately ascertained; any period when remittance of money which will or may be involved in the realisation of any asset of LMIR Trust or in the payment for such asset of LMIR Trust cannot, in the opinion of the Manager, be carried out at normal rates of exchange; any period where the issuance of Units is suspended pursuant to any order or direction issued by the MAS; in relation to any general meeting of Unitholders, the period of 48 hours before such general meeting or any adjournment thereof; or
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(3)

The formation and structure of LMIR Trust any period when the business operations of the Manager or the Trustee in relation to LMIR Trust are substantially interrupted or closed as a result of, or arising from, pestilence, acts of war, terrorism, insurrection, revolution, civil unrest, riots, strikes or acts of God. Such suspension shall take effect forthwith upon the declaration in writing thereof by the Manager or the Trustee (as the case may be) and shall terminate on the day following the first Business Day on which the condition giving rise to the suspension ceases to exist and no other conditions under which suspension is authorised (as set out above) exists, upon the declaration in writing thereof by the Manager or the Trustee (as the case may be). In the event of any suspension while LMIR Trust is listed on the SGX-ST, the Manager shall ensure that immediate announcement of such suspension is made through the SGX-ST. Redemption of Units The Trust Deed provides that any redemption of Units will be carried out in accordance with the Property Funds Guidelines, the rules of the Listing Manual (if applicable) and all other applicable laws and regulations. With respect to any terms which are necessary to carry out such redemption but are not prescribed by the Property Funds Guidelines, the rules in the Listing Manual and any laws and regulations, these terms shall be determined by mutual agreement between the Manager and the Trustee. However, for so long as the Units are listed on the SGX-ST, the Unitholders have no right to request the Manager to repurchase or redeem their Units while the Units are listed on the SGX-ST and/or any other Recognised Stock Exchange. It is intended that the Unitholders may only deal in their listed Units through trading on the SGX-ST. Rights and liabilities of Unitholders The key rights of Unitholders include rights to: receive income and other distributions attributable to the Units held; receive audited accounts and the annual reports of LMIR Trust; and participate in the termination of LMIR Trust by receiving a share of all net cash proceeds derived from the realisation of the assets of LMIR Trust less any liabilities, in accordance with their proportionate interests in LMIR Trust. No Unitholder has a right to require that any asset of LMIR Trust be transferred to him. Further, Unitholders cannot give any directions to the Trustee or the Manager (whether at a meeting of Unitholders duly convened and held in accordance with the provisions of the Trust Deed or otherwise) if it would require the Trustee or the Manager to do or omit doing anything which may result in: LMIR Trust ceasing to comply with applicable laws and regulations; or the exercise of any discretion expressly conferred on the Trustee or the Manager by the Trust Deed or the determination of any matter which, under the Trust Deed, requires the agreement of either or both of the Trustee and the Manager. The Trust Deed contains provisions that are designed to limit the liability of a Unitholder to the amount paid or payable for any Unit. The provisions seek to ensure that if the Issue Price of the Units held by a Unitholder has been fully paid, no such Unitholder, by reason alone of being a Unitholder, will be personally liable to indemnify the Trustee or any creditor of LMIR Trust in the event that the liabilities of LMIR Trust exceed its assets. Under the Trust Deed, every Unit carries the same voting rights. Amendments of the Trust Deed Subject to the third paragraph below, save where an amendment to the Trust Deed has been approved by an Extraordinary Resolution passed at a meeting of Unitholders duly convened and held in accordance
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The formation and structure of LMIR Trust with the provisions of the Trust Deed, no amendment may be made to the provisions of the Trust Deed unless the Trustee certifies, in its opinion, that such amendment: does not materially prejudice the interests of Unitholders and does not operate to release, to any material extent, the Trustee or the Manager from any responsibility to the Unitholders; is necessary in order to comply with applicable fiscal, statutory or official requirements (whether or not having the force of law); or is made to remove obsolete provisions or to correct a manifest error. No such amendment shall impose upon any Unitholder any obligation to make any further payments in respect of his Units or to accept any liability in respect thereof. Notwithstanding any of the above, the Manager and the Trustee may, with the written approval of the competent authorities, alter certain provisions in Clause 9 of the Trust Deed relating to the use of derivatives. Meeting of Unitholders Under applicable law and the provisions of the Trust Deed, LMIR Trust will not hold any meetings for Unitholders unless the Trustee or the Manager convenes a meeting or unless not less than 50 Unitholders or Unitholders representing not less than 10.0% of the total Units issued requests a meeting to be convened. A meeting of Unitholders when convened may, by Extraordinary Resolution and in accordance with the provisions of the Trust Deed: sanction any modification, alteration or addition to the Trust Deed which shall be agreed by the Trustee and the Manager as provided in the Trust Deed; sanction a supplemental deed increasing the maximum permitted limit or any change in the structure of the Managers management fees, acquisition fee and divestment fee and the Trustees fee; remove the auditors; remove the Trustee; direct the Trustee to take any action pursuant to Section 295 of the SFA; and delist LMIR Trust after it has been listed. A meeting of Unitholders may, also by an Ordinary Resolution of Unitholders present and voting at a meeting of Unitholders convened in accordance with the Trust Deed, vote to remove the Manager (with the Manager and its related parties being permitted to vote) or the Trustee. Any decision to be made by resolution of Unitholders other than the above shall be made by Ordinary Resolution, unless an Extraordinary Resolution is required by the SFA, the CIS Code or the Listing Manual. Except as otherwise provided for in the Trust Deed, at least 14 days notice (not inclusive of the day on which the notice is served or deemed to be served and of the day for which the notice is given) of every meeting shall be given to the Unitholders in the manner provided in the Trust Deed. Each notice shall specify the place, day and hour of the meeting, and the terms of the resolutions to be proposed, and each such notice may, in general, be given by advertisement in the daily press and in writing to each stock exchange on which LMIR Trust is listed. Any notice of a meeting called to consider special business shall be accompanied by a statement regarding the effect of any proposed resolutions in respect of such special business. The quorum at a meeting shall not be less than two Unitholders present in person or by proxy, holding or representing one-tenth in value of all the Units for the time being in issue. Voting at a meeting shall be by a show of hands unless a poll is demanded by the chairman of the meeting, or by five or more Unitholders present in person or by proxy, or holding or representing one tenth in value of
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The formation and structure of LMIR Trust all the Units represented at the meeting. Unitholders do not have different voting rights on account of the number of votes held by a particular Unitholder. On a show of hands, every Unitholder has one vote. On a poll, every Unitholder has one vote for each Unit of which it is the Unitholder. The Trust Deed does not contain any limitation on non-Singapore resident or foreign Unitholders holding Units or exercising the voting rights with respect to their unitholdings. Neither the Manager nor any of its Associates shall be entitled to vote or be counted as part of a quorum at a meeting convened to consider a matter in respect of which the Manager or any of its Associates has a material interest save for an Ordinary Resolution duly proposed to remove the Manager, in which case, no Unitholder shall be disenfranchised. For so long as the Manager is the manager of LMIR Trust, the controlling shareholders (as defined in the Listing Manual) of the Manager and of any of its Associates are prohibited from voting or being counted as part of a quorum for any meeting of Unitholders convened to consider a matter in respect of which the relevant controlling shareholders of the Manager and/or of any of its Associates have a material interest. Substantial holdings Under Section 137B of the Securities and Futures Act, Substantial Unitholders will be required to notify the Trustee of their deemed and direct holdings and any subsequent change in the percentage level of such holdings (rounded down to the next whole number) or their ceasing to hold 5.0% or more of the total number of Units within two Business Days of acquiring such holdings or of such changes or such cessation. Under Section 137A of the Securities and Futures Act, Substantial Unitholders must also, within the same time limit, submit such notifications to the SGX-ST. Failure to comply with either Section 137A or Section 137B of the Securities and Futures Act constitutes an offence and will render a Substantial Unitholder liable to a fine on conviction. Directors declaration of Unitholdings Under the Trust Deed, the Directors are required to give notice to the Manager of their acquisition of Units or of changes to the number of Units which they hold or in which they have an interest, within two Business Days after such acquisition or the occurrence of the event giving rise to changes in the number of Units which they hold or in which they have an interest, as applicable. Upon such notification, the Manager will promptly announce such interests or changes to the SGX-ST. A Director is deemed to have an interest in Units in the following circumstances: Where the Director is the beneficial owner of a Unit (whether directly through a direct Securities Account or indirectly through a depository agent or otherwise), he is deemed to have an interest in that Unit. Where a body corporate is the beneficial owner of a Unit and the Director is entitled to exercise or control the exercise of not less than 20.0% of the votes attached to the voting shares in the body corporate, he is deemed to have interest in that Unit. Where the Directors spouse or infant child (including step-child and adopted child) has any interest in a Unit, he is deemed to have an interest in that Unit. Where the Director, his spouse or infant child (including step-child and adopted child): - has entered into a contract to purchase a Unit; - has a right to have a Unit transferred to any of them or to their order, whether the right is exercisable presently or in the future and whether on the fulfilment of a condition or not; - has the right to acquire a Unit under an option, whether the right is exercisable presently or in the future and whether on the fulfilment of a condition or not; or - is entitled (otherwise than by reason of any of them having been appointed a proxy or representative to vote at a meeting of Unitholders) to exercise or control the exercise of a right attached to a Unit, not being a Unit which any of them holds, the Director is deemed to have an interest in that Unit.
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The formation and structure of LMIR Trust Where the property subject to a trust consists of or includes a Unit and the Director knows or has reasonable grounds for believing that he has an interest under the trust and the property subject to the trust consists of or includes such Unit, he is deemed to have an interest in that Unit. The Trustee The trustee of LMIR Trust is HSBC Institutional Trust Services (Singapore) Limited. The Trustee is a company incorporated in Singapore and registered as a trust company under the Trust Companies Act 2005, Chapter 336 of Singapore. It is approved to act as a trustee for authorised collective investment schemes under the SFA. The Trustee has a paid-up capital of S$5,150,000 and has a place of business in Singapore at 21 Collyer Quay, #14-01 HSBC Building, Singapore 049320. The Trustee is independent of the Manager. Powers, duties and obligations of the Trustee The Trustees powers, duties and obligations are set out in the Trust Deed. The powers and duties of the Trustee include: acting as trustee of LMIR Trust and, in such capacity, safeguarding the rights and interests of the Unitholders, for example, by satisfying itself that transactions it enters into for and on behalf of LMIR Trust with a related party of the Manager or LMIR Trust are conducted on normal commercial terms, are not prejudicial to the interests of LMIR Trust and the Unitholders, and in accordance with the rules of all applicable requirements under the Property Funds Guidelines and/or the Listing Manual or other relevant Recognised Stock Exchange(s) relating to the transaction in question; holding the assets of LMIR Trust on trust for the benefit of the Unitholders in accordance with the Trust Deed; and exercising all the powers of a trustee and the powers that are incidental to the ownership of the assets of LMIR Trust. The Trustee has covenanted in the Trust Deed that it will exercise all due diligence and vigilance in carrying out its functions and duties, and in safeguarding the rights and interests of Unitholders. In the exercise of its powers, the Trustee may (on the recommendation of the Manager) and subject to the provisions of the Trust Deed, acquire or dispose of any real or personal property, borrow and encumber any asset. The Trustee may, subject to the provisions of the Trust Deed, appoint and engage: a person or entity to exercise any of its powers or perform its obligations; and any real estate agents or managers, including a related party of the Manager, in relation to the management, development, leasing, purchase or sale of any of real estate assets and real estaterelated assets. Although the Trustee may borrow money and obtain other financial accommodation for the purposes of LMIR Trust, both on a secured and unsecured basis, the Manager must not direct the Trustee to incur a liability if to do so would mean that total liabilities of LMIR Trust exceed 35.0% (or such other limit as may be stipulated by the MAS) of the value of its Deposited Property in accordance with the provisions of the Property Funds Guidelines. The Trustee must carry out its functions and duties and comply with all the obligations imposed on it and set out in the Trust Deed, the Listing Manual, the SFA, the CIS Code (including the Property Funds Guidelines), any tax ruling and all other relevant laws. It must retain LMIR Trusts assets, or cause LMIR Trusts assets to be retained, in safe custody and cause LMIR Trusts accounts to be audited. It can appoint valuers to value the real estate assets and real estate-related assets of LMIR Trust. The Trustee is not personally liable to a Unitholder in connection with the office of the Trustee except in respect of its own fraud, gross negligence, wilful default, breach of duty or breach of trust. Any liability incurred and any indemnity to be given by the Trustee shall be limited to the assets of LMIR Trust over which the Trustee has recourse, provided that the Trustee has acted without fraud, negligence, wilful
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The formation and structure of LMIR Trust default, breach of trust or breach of the Trust Deed. The Trust Deed contains certain indemnities in favour of the Trustee under which it will be indemnified out of the assets of LMIR Trust for liability arising in connection with certain acts or omissions. These indemnities are subject to any applicable laws. Retirement and replacement The Trustee may retire or be replaced under the following circumstances: The Trustee shall not be entitled to retire voluntarily except upon the appointment of a new trustee (such appointment to be made in accordance with the provisions of the Trust Deed). The Trustee may be removed by notice in writing to the Trustee by the Manager: - if the Trustee goes into liquidation (except a voluntary liquidation for the purpose of reconstruction or amalgamation upon terms previously approved in writing by the Manager) or if a receiver is appointed over any of its assets or if a judicial manager is appointed in respect of the Trustee; - if the Trustee ceases to carry on business; - if the Trustee fails or neglects after reasonable notice from the Manager to carry out or satisfy any material obligation imposed on the Trustee by the Trust Deed; - if an Ordinary Resolution is passed at a Unitholders meeting duly convened and held in accordance with the provisions of the Trust Deed, and of which not less than 21 days notice has been given to the Trustee and the Manager, shall so decide; or - if the MAS directs that the Trustee be removed. Trustees fee Under the Trust Deed, the maximum fee payable to the Trustee is 0.03% per annum of the value of the Deposited Property, subject to a minimum of S$15,000 per month, excluding out-of-pocket expenses and GST. LMIR Trust will also pay the Trustee a one-time inception fee of S$25,000. The Trustees fee will be subject to review three years from the Listing Date. Any increase in the maximum permitted amount or any change in the structure of the Trustees fee must be passed by an Extraordinary Resolution at a Unitholders meeting duly convened and held in accordance with the provisions of the Trust Deed. Termination of LMIR Trust Under the provisions of the Trust Deed, the duration of LMIR Trust shall end on: such date as may be provided under written law; the date on which LMIR Trust is terminated by the Manager in such circumstances as set out under the provisions of the Trust Deed as described below; and the date on which LMIR Trust is terminated by the Trustee in such circumstances as set out under the provisions of the Trust Deed as described below. The Manager may in its absolute discretion terminate LMIR Trust by giving notice in writing to all Unitholders and the Trustee no later than three months in advance and to the MAS not less than seven days before the termination in any of the following circumstances: if any law shall be passed which renders it illegal or in the opinion of the Manager impracticable or inadvisable to continue LMIR Trust; if the NAV of the Deposited Property shall be less than S$50,000,000 after the end of the first anniversary of the date of the Trust Deed or any time thereafter; and if at any time LMIR Trust becomes unlisted after it has been listed.
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The formation and structure of LMIR Trust Subject to the SFA and any other applicable law or regulation, LMIR Trust may be terminated by the Trustee by notice in writing in any of the following circumstances, namely: if the Manager shall go into liquidation (except a voluntary liquidation for the purpose of reconstruction or amalgamation upon terms previously approved in writing by the Trustee) or if a receiver is appointed over any of its assets or if a judicial manager is appointed in respect of the Manager or if any encumbrance shall take possession of any of its assets or if it shall cease business and the Trustee fails to appoint a successor manager in accordance with the provisions of the Trust Deed; if any law shall be passed which renders it illegal or in the opinion of the Trustee impracticable or inadvisable to continue LMIR Trust; or if within the period of three months from the date of the Trustee expressing in writing to the Manager the desire to retire, the Manager shall have failed to appoint a new trustee in accordance with the provisions of the Trust Deed. The decision of the Trustee in any of the events specified above shall be final and binding upon all the parties concerned but the Trustee shall be under no liability on account of any failure to terminate LMIR Trust pursuant to the paragraph above or otherwise. The Manager shall accept the decision of the Trustee and relieve the Trustee of any liability to it therefor and hold it harmless from any claims whatsoever on its part for damages or for any other relief. Generally, upon the termination of LMIR Trust, the Trustee shall, subject to any authorisations or directions given to it by the Manager or the Unitholders pursuant to the Trust Deed, sell the Deposited Property and repay any borrowings incurred on behalf of LMIR Trust in accordance with the Trust Deed (together with any interest accrued but remaining unpaid) as well as all other debts and liabilities in respect of LMIR Trust before distributing the balance of the Deposited Property to the Unitholders in accordance with their proportionate interests in LMIR Trust.

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Certain agreements relating to LMIR Trust and the Properties

The agreements discussed in this section are complex documents and the following is a summary only. Investors should refer to the agreements themselves to confirm specific information or for a detailed understanding of LMIR Trust. The agreements are available for inspection at the registered office of the Manager at 78 Shenton Way, #05-01 Lippo Centre, Singapore 079120 for a period of six months from the date of this Prospectus. DESCRIPTION OF THE SINGAPORE SPC SHARE PURCHASE AGREEMENTS On 18 October 2007, the Trustee and the Vendors entered into 14 Singapore SPC Share Purchase Agreements, pursuant to which the Trustee will, on the Listing Date and subject to the listing of LMIR Trust on the SGX-ST, acquire all the ordinary shares and redeemable preference shares in each of the Target Singapore SPCs. The minimum purchase consideration (the Base Amount) payable to the respective Vendors in respect of each Property is set out below. Property Retail Mall Gajah Mada Plaza . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Cibubur Junction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . The Plaza Semanggi. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Mal Lippo Cikarang . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Ekalokasari Plaza . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Bandung Indah Plaza . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Istana Plaza . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Retail Spaces Mall WTC Matahari Units . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Metropolis Town Square Units . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Depok Town Square Units . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Java Supermall Units . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Malang Town Square Units . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Plaza Madiun . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Grand Palladium Medan Units . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Base Amount (S$) . . . . . . . . . . . . . . 85,607,345 77,693,943 177,226,637 66,145,410 54,457,065 102,664,500 103,713,095 20,762,193 27,668,942 21,167,650 21,433,294 21,069,781 27,571,074 21,573,107 828,754,036

Aggregate Base Amount . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

The aggregate purchase consideration payable to the Vendors on completion for the acquisition of all of the ordinary shares and redeemable preference shares in the Target Singapore SPCs will be determined according to the following formula: [(A + B) C] Where A is the total proceeds raised from the Offering; B is the total proceeds raised from the issuance of the Cornerstone Units; and C is the issue expenses. Retail Mall Singapore SPC In the event that the aggregate purchase consideration is greater than the aggregate Base Amount payable to the Vendors, the purchase consideration payable to the respective Vendor on completion for
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Certain agreements relating to LMIR Trust and the Properties the acquisition of all of the ordinary shares and redeemable preference shares in the respective Retail Mall Singapore SPC will be determined in accordance with the following formula: [(A + B) C] (D / E) where A is the total proceeds raised from the Offering; B is the total proceeds raised from the issuance of the Cornerstone Units; C is the issue expenses; D is the valuation of the relevant Property by Knight Frank; and E is the aggregate valuation of all the Properties by Knight Frank. Retail Space Singapore SPC In respect of the Retail Space Singapore SPCs, the relevant Base Amount of each Retail Space Singapore SPC (Retail Space Singapore SPC Base Amount) shall be determined in accordance with the following formula: (0.95 F) + (0.05 G) where F G is the Base Amount of the Retail Space which is indirectly 95.0% owned by the relevant Retail Space Singapore SPC; and is the Base Amount of the Retail Space which is indirectly 5.0% owned by the relevant Retail Space Singapore SPC.

In the event that the aggregate purchase consideration is greater than the aggregate Base Amount payable to the Vendors, the purchase consideration payable to the respective Vendor on completion for the acquisition of all the ordinary shares and redeemable preference shares in the respective Retail Space Singapore SPC will be the higher of: (a) (b) the Base Amount for the relevant Retail Space Singapore SPC as described above; or the amount determined in accordance with the following formula: [(A + B) C] (D / E) where A is the total proceeds raised from the Offering; B is the total proceeds raised from the issuance of the Cornerstone Units; C is the issue expenses; D is the Retail Space Singapore SPC Base Amount; and E is the Aggregate Base Amount. In the event that the aggregate purchase consideration falls below the aggregate Base Amount, LMIR Trust will cover for the shortfall (i.e. the difference between the aggregate Base Amount and the aggregate purchase consideration) with the cash balance in the respective Indonesian SPC as at the Listing Date and pay the relevant Base Amount (in respect of the Retail Mall Singapore SPC) or Retail Space Singapore SPC Base Amount (in respect of the Retail Space Singapore SPC) to the respective Vendor. Each Singapore SPC Share Purchase Agreement provides that completion will be subject to the satisfaction of a number of conditions including but not limited to the following: (a)
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the occurrence of the listing, and the commencement of trading, of the Units on the SGX-ST;

Certain agreements relating to LMIR Trust and the Properties (b) (with regard to the Retail Space Singapore SPCs) the completion of the sale and purchase of each of the Properties in accordance with the terms and conditions of the relevant Property Purchase Agreement; the concurrent completion of the sale and purchase of all the ordinary shares and redeemable preference shares of each of the other Target Singapore SPCs in accordance with the terms and conditions of the relevant Singapore SPC Share Purchase Agreement; there being no damage to the relevant Property and no breach of warranties which in the reasonable opinion of the Trustee, acting on the recommendation of the Manager, will have a material adverse effect on the financial condition, prospects, earnings, business, undertaking or assets of the Property, the relevant Target Singapore SPC or the relevant Indonesian SPC, in each case, taken as a whole; and (with regard to the Retail Space Singapore SPCs) the entry into the Master Lease Agreements by the Master Lessee and the relevant Retail Space Indonesian SPCs.

(c)

(d)

(e)

The Vendors have undertaken to the Trustee to fulfil or to procure the fulfilment of the conditions of the Singapore SPC Share Purchase Agreements. In the event the listing and trading of the Units on the SGX-ST does not occur on the Listing Date or such other date as agreed by the Trustee and the Vendors, each of the Trustee and the Vendors is entitled to rescind the Singapore SPC Share Purchase Agreements for the sale and purchase of all the ordinary shares and redeemable preference shares in the Target Singapore SPCs with, among other things, full repayment by the Vendors to the Trustee of the completion amount under each of the respective Singapore SPC Share Purchase Agreements. Each Singapore SPC Share Purchase Agreement contains customary representations and warranties made by the Vendors, subject to certain limitations on its liability, in respect of the relevant Target Singapore SPC ordinary and redeemable preference shares, the relevant Indonesian SPC and the relevant Property.

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226
LMIR Trust 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%. Tier 1 Greenlot Investments Pte. Ltd. Tangent Investments Pte. Ltd. Magnus Investments Pte. Ltd. Thornton Investments Pte. Ltd. Pierbridge Investments Pte. Ltd. Retail Mall Singapore SPCs 100.0% 95.0% 100.0% 95.0% 100.0% 95.0% 100.0% 95.0% 100.0% 95.0% 100.0% Tier 2 Silver Dory Holdings Pte. Ltd. 95.0% 5.0% 5.0% Vernon Investments Pte. Ltd. Maxia Investments Pte. Ltd. Fenton Investments Pte. Ltd. 5.0% Langston Investments Pte. Ltd. 5.0% Bowland Investments Pte. Ltd. 5.0% Retail Mall Singapore SPCs PT Cibubur Utama PT Megah Semesta Abadi PT Suryana Istana Pasundan PT Indah Pesona Bogor PT Primatama Nusa Indah Retail Mall Indonesian SPCs 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% Cibubur Junction Bandung Indah Plaza Istana Plaza Ekalokasari Plaza The Plaza Semanggi Retail Malls

Certain agreements relating to LMIR Trust and the Properties

SUMMARY OF OWNERSHIP STRUCTURE OF THE RETAIL MALLS

100.0%

Belilios International Pte. Ltd.

Dominion Capital Pte. Ltd.

5.0%

100.0%

5.0%

Prism Investments Pte. Ltd.

95.0%

PT Graha Baru Raya

PT Graha Nusa Raya

100.0%

Gajah Mada Plaza

Mal Lippo Cikarang

Certain agreements relating to LMIR Trust and the Properties

SUMMARY OF OWNERSHIP STRUCTURE OF THE RETAIL SPACES

LMIR Trust

100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

Java Properties Pte. Ltd. Detos Properties Pte. Ltd. Palladium Properties Pte. Ltd.

Serpong Properties Pte. Ltd. Metropolis Properties Pte. Ltd. Matos Properties Pte. Ltd.

Madiun Properties Pte. Ltd.

Java Properties Pte. Ltd.

Retail Space Singapore SPCs

5.0%

5.0%

5.0%

5.0%

5.0%

5.0%

5.0%

95.0% PT Gema Metropolis Modern PT Matos Surya Perkasa PT Megah Detos Utama

95.0%

95.0%

95.0%

95.0% PT Palladium Megah Lestari

95.0% PT Madiun Ritelindo

95.0% PT Java Mega Jaya Retail Space Indonesian SPCs

PT Dinamika Serpong

100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

Mall WTC Matahari Units Metropolis Town Square Units

Malang Town Square Units

Depok Town Square Units

Grand Palladium Medan Units

Plaza Madiun

Java Supermall Units

Retail Spaces

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Certain agreements relating to LMIR Trust and the Properties DESCRIPTION OF THE DEEDS OF INDEMNITY On 18 October 2007, Lippo Capital Limited, which indirectly owns 100.0% of the issued shares of Lippo Strategic, entered into 14 Deeds of Indemnity with the Trustee pursuant to which Lippo Capital Limited will indemnify the Trustee against certain liabilities or damage suffered by the Trustee arising out of or in connection with the 14 Singapore SPC Share Purchase Agreements respectively, subject to certain terms and conditions including the following: (a) if any Singapore SPC Share Purchase Agreement is rescinded or terminated in accordance with the terms and conditions of the relevant Singapore SPC Share Purchase Agreement, Lippo Capital Limited shall, except for certain obligations, be released and discharged from its obligations under the relevant Deed of Indemnity; the maximum aggregate liability of Lippo Capital Limited to the Trustee under each of the Deeds of Indemnity shall not exceed the completion amount under the relevant Singapore SPC Share Purchase Agreement; no liability shall attach to Lippo Capital Limited under a Deed of Indemnity unless the aggregate amount of all claims for which the Vendor would be liable under that Deed of Indemnity equals to or exceeds an amount equivalent to S$1,500,000 (for a Singapore SPC Share Purchase Agreement relating to a Retail Mall) or S$500,000 (for a Singapore SPC Share Purchase Agreement relating to a Retail Space), but if the aggregate liability in respect of all such claims equals to or exceeds such amount, then all claims, including claims previously notified, shall accrue against and be recoverable against Lippo Capital Limited; no claim shall be brought against Lippo Capital Limited unless it is notified in writing before the expiry of a period of 48 months for taxation claims and 24 months for any other claims from the date of completion of the relevant Singapore SPC Share Purchase Agreement; and the Trustee shall not be entitled to recover from Lippo Capital Limited for breach of a warranty more than once in respect of the same damage suffered.

(b)

(c)

(d)

(e)

Each Deed of Indemnity contains customary representations and warranties made to the Trustee by Lippo Capital Limited.

DESCRIPTION OF THE MASTER LEASE AGREEMENTS On 18 October 2007, each of the Retail Space Indonesian SPCs (as landlord) and the Master Lessee (as tenant) entered into a Master Lease Agreement, pursuant to which the Retail Spaces were leased to the Master Lessee in accordance with the terms and conditions of the Master Lease Agreements.

Lease term and renewal of lease term The term of each Master Lease Agreement is for 10 years with an option for the Master Lessee to renew the lease for a further term of 10 years based on substantially the same terms and conditions, except for the renewal rent. The renewal rent for the further term shall be at the then prevailing market rent, as may be agreed by the relevant landlord and the Master Lessee in good faith. If there is no agreement by the relevant landlord and the Master Lessee on such prevailing market rent, the relevant landlord and the Master Lessee may refer the determination of the prevailing market rent to an independent property valuer or valuers. The renewal of lease must be made by written request to the relevant landlord 12 months before the expiry of the lease term.
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Certain agreements relating to LMIR Trust and the Properties Lease rental The Master Lessee is required to make lease rental payments to the relevant landlords on a monthly basis in advance, such lease rental payments to be determined as follows: Period commencing from Listing Date to end of FY 2007 The lease rental for the period commencing from Listing Date to end of FY 2007, shall be a sum equivalent to the applicable rental rate1 multiplied by the GFA of the relevant Retail Space and multiplied by the number of months in the period commencing from Listing Date to end of FY 2007. FY 2008 to FY 2011 The lease rental for FY 2008 shall be based on the rental rate which is 108.0% of the rental rate applicable to the period commencing from the Listing Date to end of FY 2007. The lease rental for each of FY 2009, FY 2010 and FY 2011 shall be based on the rental rate which is 108.0% of the rental rate applicable to the immediately preceding financial year. FY 2012 to FY 2016 The lease rentals for each financial year from FY 2012 to FY 2016, shall comprise: (A) (B) an amount equivalent to the lease rental payable in respect of FY 2011; and an amount equivalent to 4.25% of the amount by which the net revenue of the Master Lessee derived from the Retail Spaces for the immediately preceding financial year exceeds the net revenue of the Master Lessee derived from Retail Spaces for the Base Year2.

The table below depicts the total lease rentals for FY 2012 to FY 2016, which is equivalent to the sum of column (A) and column (B) in the table. Lease rental FY2012 . . . . . . . . . .
(A) (B)

Amount equal to lease rental for FY 2011 Amount equal to lease rental for FY 2011 Amount equal to lease rental for FY 2011 Amount equal to lease rental for FY 2011 Amount equal to lease rental for FY 2011

FY2013 . . . . . . . . . .

FY2014 . . . . . . . . . .

FY2015 . . . . . . . . . .

FY2016 . . . . . . . . . .

4.25% x (net revenue of Master Lessee derived from Retail Spaces for FY 2011 - net revenue of Master Lessee derived from Retail Spaces for FY 2010) 4.25% x (net revenue of Master Lessee derived from Retail Spaces for FY 2012 - net revenue of Master Lessee derived from Retail Spaces for FY 2010) 4.25% x (net revenue of Master Lessee derived from Retail Spaces for FY 2013 - net revenue of Master Lessee derived from Retail Spaces for FY 2010) 4.25% x (net revenue of Master Lessee derived from Retail Spaces for FY 2014 - net revenue of Master Lessee derived from Retail Spaces for FY 2010) 4.25% x (net revenue of Master Lessee derived from Retail Spaces for FY 2015 - net revenue of Master Lessee derived from Retail Spaces for FY 2010)

This rental rate is Rp. 80,000 per sq m per month for the Metropolis Town Square Units, the Mall WTC Matahari Units, the Java Supermall Units and the Malang Town Square Units, Rp. 70,000 per square metre per month for the Depok Town Square Units and the Grand Palladium Medan Units and Rp. 60,000 per sq m per month for Plaza Madiun. The Base Year is fixed as calendar year 2010.
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Certain agreements relating to LMIR Trust and the Properties Other material terms Security deposit The Master Lessee will provide a security deposit equivalent to (i) six months rent for the first five years of the lease term and (ii) three months rent for the next five years of the lease term, in the form of cash or a bank guarantee, under the Master Lease Agreements as security for the compliance by the Master Lessee of the terms of the Master Lease Agreements as well as against any loss or damage resulting from the Master Lessees default and against any claim by the relevant landlord against the Master Lessee. Liabilities of Master Lessee The Master Lessee shall be responsible for the maintenance of the Retail Spaces and all fixtures, fittings and installations therein, including keeping the same clean and in good and tenantable condition, undertaking works to make good any damage, maintaining the mechanical and electrical equipment in accordance with the relevant manufacturers guidelines and maintenance of its own plant and machinery which are required for the operation of its business. The Master Lessee shall also be responsible for the land and building tax (including any increases) in respect of the Retail Spaces. The Master Lessee must comply, at its cost and expense, with all laws and regulations and all requirements of the relevant authorities in force at the moment relating to the Retail Spaces. Works of a capital nature during the first 30 months During the first 30 months of the lease term, the Master Lessee shall at its own cost and expense carry out all repair and replacement works in respect of the mechanical and electrical equipment, whether or not such works are of a capital nature. After the first 30 months of the lease term, the relevant landlords will be responsible for repair and replacement works in relation to the mechanical and electrical equipment which are of a capital nature. Where any replacement works (after the first 30 months of the lease term) is reasonably required by the Master Lessee in connection with any changes to the layout of the Retail Spaces, the cost of such replacement works shall be deducted from the rent payable by the Master Lessee to the relevant landlord for the rest of the lease term. Addition and alteration works The Master Lessee must obtain the prior written consent of the relevant landlord (such consent not to be unreasonably delayed or withheld) for addition and alteration works to or affecting the Retail Spaces if such works require the approval of the relevant authorities or involves the hacking of floors or structural columns and beams. Assignment The Master Lessee may sub-let to sub-lessees of good repute and sound financial standing any part of each of the Retail Spaces, not exceeding 30.0% of the total leased area of the relevant Retail Space and for a term not exceeding one year. The Master Lessee is not permitted to assign any of the Master Lease Agreements except where such assignment is in respect of (a) its subsidiary and the performance of the assignees obligations under the relevant Master Lease Agreement is guaranteed by the Master Lessee or (b) its associated company which is of equivalent or better financial standing than the Master Lessee. Insurance The Master Lessee must at its own cost take out and maintain, inter alia, all risks and public liability insurance policies in the joint names of the Master Lessee and the relevant landlord covering the relevant Retail Space. Damage or destruction If any of the Retail Spaces is damaged or destroyed such that the Retail Space cannot be used or becomes inaccessible, the relevant landlord has the option to reinstate or replace such Retail Space (or the affected part, as the case may be) using insurance proceeds received under the insurance policies. If the relevant landlord opts to reinstate or replace the Retail Space, the Master Lessee will not be liable to pay rent in respect of the period when the Retail Space cannot be used or is inaccessible. If the relevant landlord opts not to reinstate or replace the Retail Space, the Master Lessee may either terminate the relevant Master
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Certain agreements relating to LMIR Trust and the Properties Lease Agreement or opt to reinstate or replace the Retail Space using insurance proceeds received under the insurance policies. If the Retail Space is partly unusable, the Master Lessees liability for the rent will be reduced in proportion to the reduction in the usability caused by the damage from the date of the damage or destruction. Increase in tax If any change in or amendment to the relevant laws or treaties increases the taxes payable by the relevant landlord, except for any increases in building tax, the increased tax shall be borne in the following manner: (i) (ii) if such increase is less than or equal to 10.0% of the original taxes payable by the landlord, then the amount of such increase shall be solely borne by the Master Lessee; if such increase is more than 10.0% but less than or equal to 15.0% of the original taxes payable by the landlord, then: (a) (b) (iii) the Master Lessee shall bear such part of the amount of increase as is equivalent to 10.0% of the original taxes payable by the landlord; and the landlord and Master Lessee shall bear the balance of the amount of increase in equal shares; and

if such increase is more than 15.0% of the original taxes payable by the landlord, then: (a) (b) (c) the Master Lessee shall bear such part of the amount of increase as is equivalent to 10.0% of the original taxes payable by the landlord; additionally, the landlord and Master Lessee shall bear in equal shares such part of the amount of increase as is equivalent to 5.0% of the original taxes payable by the landlord; and the balance of the amount of increase shall be solely borne by the landlord.

Vacation of premises The Master Lessee is required to vacate the Retail Spaces after the expiry of the lease term. If the Master Lessee fails to vacate at the end of the expiry of the lease term, the landlord is entitled to charge the Master Lessee double the amount of the Rent for the period of holding over. On vacating the Retail Spaces, the Master Lessee must reinstate the premises to a good and tenantable condition to the reasonable satisfaction of the relevant landlord. Change in laws affecting Master Lessees operations If as a result of any change in or amendment to the applicable laws or regulations, the Master Lessee is prohibited from carrying out its current operations at any of the Retail Spaces, the Master Lessee shall be entitled to terminate the lease with a three-month termination notice and upon such termination, the security deposit will be forfeited to the landlord. The Master Lessee shall use its best endeavours to procure a replacement tenant. DESCRIPTION OF THE OPERATING COSTS AGREEMENTS Pursuant to each of the Operating Costs Agreements to be entered into between the relevant Retail Mall Indonesian SPC and Operating Company, the relevant Operating Company will agree to unconditionally bear, for a period of three years commencing from 1 January 2007, all costs directly related to the maintenance and operation of the relevant Retail Mall. In consideration of its agreements under the relevant Operating Costs Agreement, the relevant Operating Company has the right to collect, through the Property Manager, a service charge and statutory income from the tenants of the relevant Retail Mall. The service charge is intended to cover the costs directly related to the maintenance and operation of the Retail Mall. The amount of the service charge will be recommended by the Property Manager as a result of its review of the prevailing market rates. The statutory income is intended to cover the costs directly related to the provision of utilities to the Retail Mall.
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Certain agreements relating to LMIR Trust and the Properties The right to collect the service charge and statutory income shall be in accordance with the lease agreements entered into by and between the Retail Mall Indonesian SPC and the respective tenants of the Retail Mall and such collection shall be coordinated by the Property Manager. The Operating Costs Agreements will lapse on 31 December 2009 and LMIR Trust will bear all costs directly related to the maintenance and operation of the Retail Malls thereafter. The rationale for the Operating Costs Agreement is to provide certain protection to LMIR Trust in relation to the costs directly related to the maintenance and operation of the Retail Malls, in particular for Bandung Indah Plaza, Mal Lippo Cikarang, Ekalokasari Plaza and The Plaza Semanggi which are in the process of undergoing asset enhancement works and may incur higher operating costs, with a reduction in service charges received from tenants due to tenant relocation or loss at the areas which are affected by the asset enhancement works, in the initial period subsequent to the completion of the asset enhancement works. DESCRIPTION OF THE RENTAL GUARANTEE DEEDS On 10 August 2007, Lippo Strategic entered into a Rental Guarantee Deed with the following Retail Mall Singapore SPCs pursuant to which Lippo Strategic will (i) provide a rental guarantee to the relevant Retail Mall Singapore SPC in respect of existing and new units in the respective Retail Malls which are untenanted and (ii) undertake to pay to the relevant Retail Mall Singapore SPC any shortfall in the maintenance and operation costs which the relevant Operating Company has undertaken to bear under the respective Operating Costs Agreement.
Retail Mall Relevant Retail Mall Singapore SPC

Gajah Mada Plaza . . . . . . . . . . . . . . . . . . . . . . . Mal Lippo Cikarang . . . . . . . . . . . . . . . . . . . . . . Cibubur Junction . . . . . . . . . . . . . . . . . . . . . . . . Bandung Indah Plaza . . . . . . . . . . . . . . . . . . . . . Istana Plaza . . . . . . . . . . . . . . . . . . . . . . . . . . . . Ekalokasari Plaza . . . . . . . . . . . . . . . . . . . . . . . . The Plaza Semanggi . . . . . . . . . . . . . . . . . . . . .

. . . . . . .

Belilios International Pte. Ltd. Dominion Capital Pte. Ltd. Greenlot Investments Pte. Ltd. Tangent Investments Pte. Ltd. Magnus Investments Pte. Ltd. Thornton Investments Pte. Ltd. Pierbridge Investments Pte. Ltd.

The Rental Guarantee Deeds cover the period commencing from the Listing Date up to 31 December 2009. Pursuant to the Rental Guarantee Deeds, Lippo Strategic is obliged to pay to the Retail Mall Singapore SPCs a specified sum in respect of each Retail Mall for every year during the said period. The first of such payments will be paid on or before 31 January 2008, and subsequent payments will be made on a quarterly basis thereafter. In the event any of the specified units in the relevant Retail Mall becomes tenanted during such period, the amount of the specified sum payable by Lippo Strategic in respect of such Retail Mall will be reduced by the amount of the rental payable under the relevant tenancy, regardless of whether such rental is received by the owner of the relevant Retail Mall and notwithstanding that such tenancy may be or is terminated prior to the expiry of such period. To secure Lippo Strategics performance under each of the Rental Guarantee Deeds, Lippo Strategic is required to furnish to the Retail Mall Singapore SPCs bank guarantees. The aggregate amount of all the bank guarantees to be furnished under the Rental Guarantee Deeds is S$10.0 million. DESCRIPTION OF THE RIGHT OF FIRST REFUSAL AGREEMENT On 14 August 2007, an agreement was entered into between the Trustee and the Sponsor pursuant to which the Sponsor granted to LMIR Trust, for so long as (a) Lippo-Mapletree Indonesia Retail Trust Management Ltd. remains the manager of LMIR Trust and (b) the Sponsor and/or any of its related corporations, alone or in aggregate, remains a controlling shareholder of the Manager, a ROFR over any Relevant Asset (i) which any Sponsor Entity proposes to sell or transfer (whether such Relevant Asset is wholly-owned or partly-owned by the Sponsor Entity and excluding any sale of such Relevant Asset by a Sponsor Entity to any related corporation of such Sponsor Entity pursuant to a reconstruction, amalgamation, restructuring, merger or any analogous event) to an unrelated third party or (ii) for which a proposed offer for sale or transfer of such Relevant Asset has been made to a Sponsor Entity.
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Certain agreements relating to LMIR Trust and the Properties For the purposes of the ROFR, (a) a controlling shareholder of a company means a person who (i) holds directly or indirectly 15.0% or more of the nominal amount of all voting shares of that company, or (ii) in fact exercises control over that company, and (ii) control of a company means the capacity to dominate decision-making, directly or indirectly, in relation to the financial and operating policies of that company; and a related corporation means a corporation which is (i) the holding company of another corporation, (ii) a subsidiary of another corporation; or (iii) a subsidiary of the holding company of another corporation.

(b)

Where (a) a Sponsor Entity proposes to sell or transfer a Relevant Asset (whether wholly-owned or partlyowned and excluding a sale of a Relevant Asset by a Sponsor Entity to any related corporation of such Sponsor Entity pursuant to a reconstruction, amalgamation, restructuring, merger or any analogous event) to an unrelated third party; or (b) a proposed offer for sale or transfer of a Relevant Asset is made to a Sponsor Entity, the Sponsor shall give written notice thereof to the Trustee, and will grant to the Trustee the first right to purchase the Relevant Asset for the benefit of LMIR Trust. If (i) the Trustee does not enter into a binding commitment for the purchase of the Relevant Asset within 30 days (or such longer period as may be mutually agreed) from the date of the Trustees receipt of the relevant documents or (ii) the Trustee indicates in writing that it will not be purchasing the Relevant Asset or (iii) the proposed purchase of the Relevant Asset is aborted by the Trustee, the relevant Sponsor Entity is entitled to (as the case may be) (a) sell its Relevant Asset to a third party on terms and conditions no more favourable to the third party than those offered by the Sponsor Entity to the Trustee or (b) purchase the Relevant Asset offered to it without any accountability, liability or obligation to the Trustee. The Right of First Refusal Agreement will come into effect as at Listing Date. As at Listing Date, the scope of the ROFR will encompass the ROFR Properties, being:
ROFR Properties under development Expected date of completion

Location

Estimated GFA (sq m)

Estimated NLA (sq m)

Binjai Supermall Pejaten Mall Kuta Beach Mall Kemang City Mall Puri Paragon City

North Sumatra South Jakarta Kuta, Bali South Jakarta West Jakarta

Fourth quarter of 2007 Second quarter of 2008 Second half of 2008 First half of 2009 Second half of 2009

23,615 57,948 41,562 77,555 196,400 397,080

18,300 40,327 30,735 56,052 127,660 273,074

The ROFR shall be subject to all prevailing laws, regulations and governmental policies as well as overriding contractual obligations of the relevant Sponsor Entity (if any), including obligations under existing and future joint ventures. Where a property which is subject to the ROFR is jointly owned with one or more third parties (i.e. parties which are not subject to the ROFR), the ROFR shall be subject to the consent of these third parties to the sale of that property to the Trustee, and in this respect, the Sponsor shall use reasonable endeavours to obtain such consent.

DESCRIPTION OF NON-BINDING MEMORANDUM OF UNDERSTANDING On 21 May 2007, the Manager entered into a non-binding memorandum of understanding with PT. Multi Pratama Gemilang Perkasa (Pikko Group) with regard to the potential acquisition by LMIR Trust of Cosmopolitan Mall Pluit, a retail mall located in North Jakarta, Indonesia. The Manager understands that Cosmopolitan Mall Pluit is currently undergoing asset enhancement works, with such works scheduled for completion in the second half of 2008.
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Certain agreements relating to LMIR Trust and the Properties The details of Cosmopolitan Mall Pluit are set out below: Cosmopolitan Mall Pluit Pluit, North Jakarta Expected completion date of renovation . . . . . . . Estimated GFA . . . . . . . . . . . . . . . . . . . . . . . . . . Estimated NLA . . . . . . . . . . . . . . . . . . . . . . . . . . Target segment . . . . . . . . . . . . . . . . . . . . . . . . . . District/Area. . . . . . . . . . . . . . . . . . . . . . . . . . . . . Estimated acquisition price . . . . . . . . . . . . . . . . . Second half of 2008 131,013 sq m 88,040 sq m Middle to upper income residents of North Jakarta North Jakarta To be negotiated and agreed in good faith between the parties, provided that such acquisition price shall not be more than the appraised value of Cosmopolitan Mall Pluit as determined by an independent property valuer to be appointed by the Trustee before the signing of the conditional sale and purchase agreement.

Description Located in the heart of the affluent Pluit residential district of North Jakarta, Cosmopolitan Mall Pluit offers an exciting cultural and retail experience, with urban sculptures along the waterfront, blending harmoniously with a variety of lifestyle and cuisines outlets. In the future, the Manager will identify other potential acquisitions and will enter into negotiations and nonbinding memoranda of understanding with regard to these potential acquisitions. On 22 June 2007, the Manager entered into a non-binding memorandum of understanding with Zellwager Enterprise Limited with regard to the potential acquisition by LMIR Trust of Sun Plaza, a retail mall located in Medan, North Sumatra. The details of Sun Plaza are set out below: Sun Plaza Medan, North Sumatra Estimated GFA . . . . . . . . . . . . . . . . . . . . . . . . . . Estimated NLA . . . . . . . . . . . . . . . . . . . . . . . . . . Target segment . . . . . . . . . . . . . . . . . . . . . . . . . . District/Area. . . . . . . . . . . . . . . . . . . . . . . . . . . . . Estimated acquisition price . . . . . . . . . . . . . . . . . 73,871 sq m 61,348 sq m Middle to upper income residents of Medan Medan To be negotiated and agreed in good faith between the parties, provided that such acquisition price shall not be more than the appraised value of Sun Plaza as determined by an independent property valuer to be appointed by the Trustee before the signing of the conditional sale and purchase agreement.

Description Sun Plaza is a six-level retail mall located in the Indonesian city of Medan, the third most populous city in Indonesia after Jakarta and Surabaya. Sun Plaza is surrounded by government and business offices and is accessible from all parts of Medan City.
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Certain agreements relating to LMIR Trust and the Properties The titanium faade of Sun Plaza resembles a sculpture and offers visitors an experience of luxury and elegance. On 26 June 2007, the Manager entered into a non-binding memorandum of understanding with PT. Pakuwon Permai in respect of the potential acquisition by LMIR Trust of Supermal Pakuwon Indah and Pakuwon Trade Center, a retail mall located in West Surabaya, East Java. The details of Supermal Pakuwon Indah and Pakuwon Trade Center are set out below: Supermal Pakuwon Indah and Pakuwon Trade Center West Surabaya, East Java Estimated GFA . . . . . . . . . . . . . . . . . . . . . . . . . . Estimated NLA . . . . . . . . . . . . . . . . . . . . . . . . . . Target segment . . . . . . . . . . . . . . . . . . . . . . . . . . District/Area. . . . . . . . . . . . . . . . . . . . . . . . . . . . . Estimated acquisition price . . . . . . . . . . . . . . . . . 289,563 sq m 114,834 sq m Middle to upper income residents of West Surabaya West Surabaya To be negotiated and agreed in good faith between the parties, provided that such acquisition price shall not be more than the appraised value of Supermal Pakuwon Indah and Pakuwon Trade Center as determined by an independent property valuer to be appointed by the Trustee and the appraised value is agreed by the Vendor before the signing of the conditional sale and purchase agreement.

Description Supermal Pakuwon Indah and Pakuwon Trade Center is strategically located in the heart of West Surabayas affluent residential district. The tenants of Supermal Pakuwon Indah and Pakuwon Trade Center provide a variety of shopping, dining and entertainment options to shoppers. Together with the convention centre facilities, the retail mall aims to deliver a memorable and exciting retail experience. DESCRIPTION OF THE EXISTING PROPERTY MANAGEMENT AGREEMENTS On 9 April 2006, each of the Retail Mall Indonesian SPCs have entered into an Existing Property Management Agreement with the Property Manager pursuant to which the Property Manager will operate, manage, maintain and market the Retail Malls. The initial term for each of these Existing Property Management Agreements is four years from the date of the agreement. Property Managers services The services provided by the Property Manager for the relevant Retail Mall under its management shall include, among other things, the following: Retail management services for the relevant Retail Mall, including (i) advising and developing a strategic management policy for tenants and service providers; (ii) reviewing the existing organisational structure for the operation of the Retail Mall and making changes if necessary; (iii) reviewing and implementing policies relating to human resource administration, accounting and finance, the collection of rental payments and service charges, financial reporting, maintenance, safety, security, insurance, tenancy mix, cleaning and car parking for the Retail Mall; (iv) reviewing and providing input on vehicular and pedestrian flows and customer conveniences of the Retail Mall; and (v) providing public relations and customer services;
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Certain agreements relating to LMIR Trust and the Properties Coordinating with the relevant service providers or contractors for the advertising and promotion of the Retail Mall; Preparing and implementing a lease documentation and monitoring system, and management reporting system; and Liaising with the relevant parties with regard to the building documentation system for the Retail Mall. Fees Under each Existing Property Management Agreement, the Property Manager is entitled to the following fees in respect of each Retail Mall under its management: 2.0% per annum of the Gross Revenue for the relevant Retail Mall; 2.0% per annum of the NPI for the relevant Retail Mall (after accounting for the fee of 2.0% per annum of the gross revenue for the relevant Retail Mall); and 0.5% per annum of the NPI for the relevant Retail Mall in lieu of leasing commissions otherwise payable to the Property Manager and/or third party agents. Reimbursable amounts Under each Existing Property Management Agreement, each of the Retail Mall Indonesian SPCs agrees to reimburse the Property Manager, upon request made from time to time, for its expenses incurred in connection with the provision of property management services and with the performance of its duties which are in compliance with the approved annual business plan and budget as stated in the Existing Property Management Agreement. Such expenses include, but are not limited to: rent, service charge and VAT payable by the Property Manager for its lease of its office premises; advertising and promotion costs; and salaries of the Property Managers employees who are approved by the relevant Retail Mall Indonesian SPC. Indemnity Under each Existing Property Management Agreement, each of the Retail Mall Indonesian SPCs agrees to indemnify the Property Manager against all actions, suits, proceedings, claims, demands, costs, expense and liability whatsoever (present, future, contingent or otherwise) arising as a result of the discharge, performance or exercise by the Property Manager of its duties, powers and exertions under and in accordance with the terms of the Existing Property Management Agreement. Termination If the relevant Retail Mall Indonesian SPC does not wish to extend the period of the Existing Property Management Agreement beyond the initial four year term, the Retail Mall Indonesian SPC shall provide written notice of such intention to the Property Manager at least 90 days prior to the maturity date of the initial term. The Property Manager may also terminate (without penalty) the Existing Property Management Agreement with 30 days prior written notice. The Retail Mall Indonesian SPCs do not have any right to terminate the Existing Property Management Agreements without penalty. The Existing Property Management Agreements do not provide for any termination fee. Should any of the Existing Property Management Agreements be prematurely terminated unilaterally by the relevant Retail Mall Indonesian SPC, this may be considered to be a breach of contract and the Property Manager may be entitled to damages for breach of contract, with the amount to be assessed by the relevant court of law. DESCRIPTION OF THE MASTER PROPERTY MANAGEMENT AGREEMENT Any properties located in Indonesia acquired by LMIR Trust after the Listing Date, whether such properties are directly or indirectly held by LMIR Trust, or are wholly or partly-owned by LMIR Trust will be managed by the Property Manager in accordance with the terms of a master property management agreement (the Master Property Management Agreement).
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Certain agreements relating to LMIR Trust and the Properties The Master Property Management Agreement was entered into on 18 October 2007 by the Trustee, the Manager and the Property Manager pursuant to which the Property Manager was appointed to operate, maintain, manage and market all the properties of LMIR Trust located in Indonesia acquired after the Listing Date, subject to the overall management of the Manager. The Master Property Management Agreement provides that each of the Retail Malls currently the subject of an Existing Property Management Agreement will continue to be managed in accordance with the terms of that Existing Property Management Agreement, and the terms of the Master Property Management Agreement shall not apply to the relevant Retail Mall during the subsistence of the Existing Property Management Agreement. The Master Property Management Agreement also provides that in respect of each property acquired after the Listing Date, the Trustee, the Manager and the Property Manager will enter into a separate property management agreement in the form and on the terms set out in a schedule to the Master Property Management Agreement, in order to incorporate the specific terms set out in the Master Property Management Agreement in their application to each of such properties. The initial term of the Master Property Management Agreement is four years from the Listing Date. Six months prior to expiry of the initial term of the Master Property Management Agreement, the Property Manager may request to extend its appointment for a further four years on the same terms and conditions, except for revision of all fees payable to the Property Manager to market rates prevailing at the time of such extension. Two months before expiry of the initial term, the Trustee will decide the prevailing rates for the extension term, based on the recommendation of the Manager. If the Property Manager disagrees with the Trustees decision on the prevailing market rates for the extension term, the matter will be referred to an independent expert whose determination of the prevailing market rates shall be final and binding on the parties. The Trustee shall, based on the recommendation of the Manager, agree to extend the appointment of the Property Manager for the extension term, on the revised fees based on the prevailing market rates determined as aforesaid, subject to the approval of the Unitholders of LMIR Trust, if such approval is required pursuant to any applicable legislation or regulations (including any Singaporean legislation, regulation and/or requirement, and regulatory requirements on Related Party Transactions relating to real estate investment trusts). The Trustee shall not be obliged to extend the appointment of the Property Manager if the above conditions are not fulfilled. Property Managers services The services provided by the Property Manager for each property subject to the Master Property Management Agreement will be substantially the same as those services provided by the Property Manager under the Existing Property Management Agreements. Fees The fees payable to the Property Manager under the Master Property Management Agreement will be substantially the same as those fees the Property Manager is entitled to under the Existing Property Management Agreements. Reimbursable amounts In addition to its fees, the Property Manager will be fully reimbursed for each property under its management under the Master Property Management Agreement as follows: the employment and remuneration costs of the team of personnel employed by the Property Manager for the provision of services to that property; and the employment and remuneration costs relating to the centralised team of employees of the Property Manager who provide group services for all properties the subject of the Master Property Management Agreement under its management, which costs are apportioned by the Property Manager to that property,
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Certain agreements relating to LMIR Trust and the Properties as approved in each annual budget by the Trustee following the recommendation of the Manager. Expenses The Property Manager is authorised to utilise funds deposited in operating accounts maintained in the name of the Trustee and to make payment of all costs and expenses incurred in the operation, maintenance, management and marketing of each property within each annual budget approved by the Trustee on the recommendation of the Manager. Provision of office space Where applicable, the Trustee shall permit employees of the Property Manager engaged to manage a property to occupy suitable office space at such property (as approved by the Trustee on the recommendation of the Manager) without the Property Manager being required to pay any rent, service charge, utility charges or other sums. Termination The Trustee or the Manager may terminate the appointment of the Property Manager in relation to all the properties of LMIR Trust under the management of the Property Manager pursuant to the Master Property Management Agreement on the occurrence of certain specified events, which include the liquidation or cessation of business of the Property Manager. The Trustee or the Manager may also terminate the appointment of the Property Manager specifically in relation to a property under its management in the event of the sale of such property, but the Master Property Management Agreement will continue to apply with respect to the remaining properties managed by the Property Manager under the terms of the Master Property Management Agreement. In addition, if the Property Manager, within 90 days of receipt of written notice, fails to remedy any breach (which is capable of remedy) of its obligations in relation to a property, the Trustee or the Manager may terminate the appointment of the Property Manager in relation only to such property in respect of which the breach relates, upon giving 30 days written notice to the Property Manager. On the termination of the appointment of the Property Manager, the Manager shall, as soon as practicable, procure the appointment of a replacement property manager for the affected property. Novation The Trustee and the Manager are entitled to novate their respective rights, benefits and obligations under the Master Property Management Agreement to a new trustee of LMIR Trust or a new manager of LMIR Trust appointed in accordance with the terms of the Trust Deed. With the approval of the Trustee, which approval shall not be unreasonably withheld, the Property Manager is also entitled to novate its respective rights, benefits and obligations under the Master Property Management Agreement to any wholly-owned direct or indirect subsidiary of the Sponsor. Exclusion of liability In the absence of fraud, negligence, wilful default or breach of the Master Property Management Agreement by the Property Manager, it shall not incur any liability by reason of any error of law or any matter or thing done or suffered or omitted to be done by it in good faith under the Master Property Management Agreement. In addition, the Trustee shall indemnify the Property Manager against any actions, costs, claims, damages, expenses or demands to which it may suffer or incur as Property Manager, save where such action, cost, damage, expense or demand is occasioned by the fraud, negligence, wilful default or breach of the Master Property Management Agreement by the Property Manager, its employees or agents. No restriction on Property Manager The Property Manager may provide services similar to those contemplated under the Master Property Management Agreement to other parties operating in the same or similar business as LMIR Trust or in other businesses.
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Certain agreements relating to LMIR Trust and the Properties DESCRIPTION OF THE PUT OPTION AGREEMENTS As at the Latest Practicable Date, four of the seven Retail Spaces, namely Metropolis Town Square Units, Depok Town Square Units, Malang Town Square Units and Grand Palladium Medan Units, are each bound by Kiosks Sale and Purchase Binding Agreements because their strata titles are in the process of being issued by the Indonesian government. In relation to each of the Metropolis Town Square Units, Depok Town Square Units, Malang Town Square Units and Grand Palladium Medan Units, a put option agreement has been entered into between, inter alia, the Trustee and the Master Lessee, pursuant to which, in the event that the strata titles to these four Retail Spaces are not issued within 24 months from the Listing Date, a meeting of all the Unitholders will be convened by the Trustee pursuant to which the Unitholders will vote, by way of an ordinary resolution, on whether to retain these four Retail Spaces in the portfolio of LMIR Trust for a further six months from the date of the ordinary resolution. In the event that an ordinary resolution is passed in favour of retaining these four Retail Spaces in the portfolio of LMIR Trust and the strata titles are still not issued upon expiry of six months from the date of the ordinary resolution, the Trustee shall exercise the put option. In the event that an ordinary resolution is not passed in favour of retaining these four Retail Spaces, the Trustee shall be entitled to exercise the put option within three months of the date of the meeting of the Unitholders. Upon the Trustees exercise of the put option in relation to one of these four Retail Spaces, the Master Lessee will be required to purchase the relevant Retail Space at the consideration of (a) all transaction costs incurred directly or indirectly by the Trustee in relation to the acquisition of the relevant Retail Space and (b) the higher of the sell-back NAV The sell-back NAV is based on the average of two valuations conducted by two independent valuers. It is the NAV of the relevant Indonesia SPCs as at the date of service of the put option notice (the Service Date) as determined from the audited consolidated accounts of the relevant Indonesian SPCs, duly audited by an independent public accounting firm appointed by agreement between the Master Lessee and the Trustee within ten days after the Service Date. Failing agreement, the independent public accounting firm shall be appointed by the chairman for the time being of the Singapore International Arbitration Centre. The Master Lessee and the Trustee shall procure that two independent valuers be each appointed by the Manager and the Trustee within five days after the Service Date. Each independent valuer shall determine within 30 days from the Service Date, the value of the relevant Retail Space as at the Service Date by adopting the same method and basis of valuation as that adopted for purposes of the listing of LMIR Trust. IPO NAV The IPO NAV is based on the value attributed to the four relevant Retail Spaces for the purpose of the listing of the LMIR Trust, in each case, also taking into account all transaction costs incurred directly and indirectly by the LMIR Trust for the acquisition of these four Retail Spaces. The IPO NAV will not take into account depreciation costs of the Retail Spaces incurred from the date LMIR Trust is listed on the SGX-ST. The Master Lessee and the Trustee shall procure that the independent accountants shall determine the IPO NAV within 60 days from the Service Date. The IPO NAV of the relevant Retail Space is calculated based on the following formula: Z X Y
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Certain agreements relating to LMIR Trust and the Properties Where: X is the valuation of the relevant Retail Space adopted for purposes of the Offering; Y is the valuation of the total portfolio of LMIR Trust adopted for purposes of the Offering; and Z is the implied value of the total portfolio of LMIR Trust at the Offering based on the following formula: Y + [(A B) C] Where: A is the purchase price per Unit under the Offering; B is the NAV per Unit under the Offering based on the valuation of the total portfolio of LMIR Trust adopted for purposes of the Offering; and C is the total number of Units in issue immediately after completion of the Offering. The Trustee (acting on the advice and recommendation of, and after discussions with, the Manager) is satisfied with the computation of the said transaction costs as set out in each of the put option agreements. Using the Metropolis Town Square Units as an example, in the event that the put option in respect of the Metropolis Town Square Units is exercised, each of the following events will happen concurrently on the date of completion: (i) (ii) (iii) the Trustee will transfer Metropolis Properties Pte. Ltd. (Metropolis Properties) to Matahari at the purchase consideration described above; Serpong Properties Pte. Ltd. (Serpong Properties) will transfer its 5.0% interest in PT Gema Metropolis Modern to an entity to be nominated by Matahari for consideration of S$1.00; and Metropolis Properties will transfer its 5.0% interest in PT Matos Surya Perkasa to Serpong Properties for consideration of S$1.00.

DESCRIPTION OF THE LETTER OF UNDERTAKING On 9 August 2007, the Trustee, the Manager and the Sponsor entered into a letter of undertaking, pursuant to which the Sponsor will use its best endeavours to procure that the relevant Retail Space SPCs obtain the strata titles to the Metropolis Town Square Units, Depok Town Square Units, Malang Town Square Units and Grand Palladium Medan Units. The Trustee (acting on the advice and recommendation of, and after discussions with the Manager) is of the view that the proposed arrangements, namely the put option agreements and the letter of undertaking, adequately safeguard the interest of Unitholders if the legal titles to the four Retail Spaces are not issued on or prior to the expiry of 24 months from the Listing Date.

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Overview of relevant laws and regulations in Indonesia

Indonesian real property rights are governed under Law No. 5 Year 1960 regarding Agrarian Law (the Agrarian Law) and various implementing regulations issued by the Indonesian central government and the Indonesian provincial governments. The Agrarian Law recognises the rights of legal persons to own and to use lands subject to various type of rights granted by the Agrarian Law which are, among others, (a) Right of Ownership (Hak Milik), (b) Right to Use (Hak Pakai), (c) Right to Cultivate (Hak Guna Usaha), (d) Right to Build (Hak Guna Bangunan), (e) Right to Lease (Hak Sewa), and (f) other rights issued pursuant to the implementing laws and regulations such as Strata Title Rights (Hak Atas Satuan Rumah Susun). Pursuant to the Indonesian Government Regulation No. 10 of 1961 as further amended by the Indonesian Government Regulation No. 24 of 1997 ownership of lands are evidenced by the registration of the holder of the land in the Land Register of the relevant local land office (Badan Pertanahan) where such land is located. RIGHTS TO OWN AND/OR TO USE Referring to the above there are various forms of rights for the use of land pursuant to the Agrarian Law, some of such forms are set out below. Hak Milik (HM/Right to Own). The closest form of land title to an internationally recognised concept of freehold title is Hak Milik or Right of Ownership. A Hak Milik title is available only to Indonesian individuals and certain Indonesian religious and social organisations and government bodies, as regulated in Government Regulation No. 38 of 1963. Hak Milik title cannot be obtained by companies (whether Indonesian or foreign owned) or by foreign individuals. Hak Guna Bangunan (HGB/Right to Build). HGB is a land right to build on land that belongs to another party. Indonesian individuals and Indonesian companies (or foreign investment companies incorporated in Indonesia) may acquire HGB titles. HGB titles can be granted on (i) State-owned land by the decision of the appointed relevant authority, (ii) Hak Pengelolaan (HPL/Right to Manage) land by the decision of the appointed relevant authority decision based on the recommendation of the HPL holder and (iii) Hak Milik land by a mutual agreement between the Hak Milik holder and the prospective HGB holder stated in the deed made before the Land Official. In a piece of a land, a number of HGB certificates can be issued depending on the ownership of the land. A HGB title is granted for a maximum initial term of 30 years. By application to the relevant local land office upon the expiration of this initial term, a HGB title may be extended for an additional term not exceeding 20 years. Following expiration of this additional term, a renewal application may be made. Certain requirements and procedures for a HGB renewal application must be complied with and followed including submitting relevant supporting documents and paying certain amount of administrative fee chargeable by the local land office and subject to an inspection to the location by the local land office. The New Investment Law provides incentives which includes offering land title for longer periods such that eligible investors may hold HGB title in the form of grant and an advance acceleration of land title for a period of 50 years, and may be renewed for an additional term of 30 years. Hak Pakai (HP/Right to Use). Hak Pakai is the right to use and/or collect the products of land directly administered by the State (State-owned land), or of land owned by other persons (based on Hak Milik). Hak Pakai over land can be granted by the government in the form of a decree or by an Indonesian citizen in the form of an agreement. The decree or the agreement gives the user the rights and obligations laid down in that decree or agreement. Only (i) Indonesian citizens, (ii) Indonesian foreigners domiciled in Indonesia, (iii) legal entities established under Indonesian law and having domicile in Indonesia and (iv) foreign entities that have representative in Indonesia, may have such rights and the holder of such land right may mortgage the land as security. Hak Pakai titles can be granted on (i) State-owned land by the decision of the appointed relevant authority, (ii) HPL pursuant to the decision of the relevant Minister or the relevant appointed authority based on the recommendation of the owner of the HPL title or (iii) Hak Milik land by a mutual agreement between the Hak Milik holder and the prospective HGB holder stated in the deed made before the Land Official.
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Overview of relevant laws and regulations in Indonesia Hak Pakai can be granted for a definite period of time or indefinite period of time. For definite of time, Hak Pakai is granted for a maximum of 25 years and may be extended for an additional term of 20 years. Following expiration of this additional term, an extension cannot be granted but a renewal application may be made. Like a HGB renewal application, certain requirements and procedures for a Hak Pakai renewal application must be complied with and followed including submitting relevant supporting documents and paying certain amount of administrative fee chargeable by the local land office and subject to an inspection to the location by the local land office. Hak Pakai with an indefinite period of time can be granted as long as it is in use to governmental departments or institutions, local governments, embassies/representatives of other countries, representatives of international institutions, religious bodies and social institutions. Under the New Investment Law, Hak Pakai with definite period may also be granted for a longer periods for an advance acceleration of land title for a period of 45 years and it may be renewed for an additional term of 25 years. The extension and/or renewal of HGB or Hak Pakai title is granted if the following conditions are met: (a) (b) (c) (d) the land is being properly used in accordance with the situation, nature and objective of the granting of the right; the requirements of the granting of the right are fulfilled by the title holder; the titleholder still meets the requirements as a titleholder of the land; and the land is still used in accordance with the Spatial Plan (Rencana Tata Ruang Wilayah) of the area.

The granting of acceleration and renewal of HGB and Hak Pakai based on the New Investment Law may only be granted if the following conditions are met: (a) (b) (c) (d) (e) the investment will be conducted for a long period and related to structural changes of the Indonesian economy; the investment with a level of investment risk that requires a long term investment return in accordance with the type of investment being conducted; the investment which does not require an extensive area; the investment which uses state-owned land rights; and the investment which does not disturb the sense of impartiality in the community as well as public interest.

The renewal of the HGB and Hak Pakai based on the New Investment Law may be granted after it is evaluated as to whether the land can be further appropriately used according to the condition, nature and objective of granting of the rights. It is unclear how the land office will respond to the issuance of the New Investment Law, which grants a longer period of the term of the land title. A HGB or Hak Pakai title holder has the right to erect, occupy and use buildings on such parcel of land and sell all or part of such parcel to a third party. Further, the HGB or Hak Pakai title can be revoked if the following occur: (a) (b) the period of the title as stated in the decision/agreement of granting or extending the title is expired; the authority or the HPL or Hak Milik holder terminates the period before the expiry of the land title due to (i) non fulfilment of the obligations of the land title, (ii) non compliance of the requirements or obligations stated in the decision/agreement between the HGB or Hak Pakai holder and the HPL or Hak Milik holders, or (iii) the final and binding court decision; the revocation of the land title; or if the land title holder who is not an eligible party to hold the title does not transfer the land title to other party within one year.

(c) (d)

If the HGB or Hak Pakai title on State-owned land is revoked, is not renewed or extended, the HGB or Hak Pakai holder must demolish the buildings erected on such land and return the land to the state within one
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Overview of relevant laws and regulations in Indonesia year after the land title is revoked. If the HGB or Hak Pakai title on Hak Milik or HPL land is not renewed or extended, the HGB or Hak Pakai holder must return the land to the Hak Milik or HPL land in accordance with agreement among the parties. The application should be made no later than two years prior to the expiration of the additional term. The land office has discretion to grant the various extensions. Hak Pengelolaan (HPL/Right to Manage). HPL is the right to (i) plan the purpose and the use of the land, (ii) use the land for the needs of the business of the holder, and (iii) surrender plots of land to third parties in accordance with the terms and conditions laid down by the holder of the HPL title. HPL titles can be granted to (i) Indonesian governmental institutions including local government, (ii) State-owned enterprises (ii) Indonesian regional government enterprises, (iv) Persero Limited Liability Company, (v) Authority bodies and (vi) other legal entities owned by the Indonesian government. HPL is granted for an indefinite period of time. The application of granting HPL is made to the relevant Minster through local Land officers where the land is located. HGB and Hak Pakai can be granted over the HPL land based on local land officers recommendations. Strata Titles. Indonesian law regulates strata titles, as stipulated in Law No. 16 of 1985 and Government Regulation No. 4 of 1988 and its implementing regulations. Strata title buildings may only be constructed on plots of land with a right of ownership (Hak Milik), HGB or Hak Pakai on State-owned land. For a plot of land with HPL, such right must first be converted to a HGB for the construction of multi-storey offices, residential or retail buildings on it. Under Indonesian law, strata title is a legal title to the building property and common property, common area and common land of which all constitute an inseparable part to the strata title ownership The right of strata title ownership may be owned by an individual, a corporation established under Indonesian Law and domiciled in Indonesia or foreigners depending on the title of the land where a strata title building is built. For strata title ownership, a certificate for the right of strata title ownership is issued. Strata title buildings including the underlying common land and the right of strata title ownership may be put as encumbrance with (a) Hak Tanggungan, if the title of the land is Hak Milik or, HGB and Hak Pakai of state-owned land, or (b) fiduciary security, if the title of the land is Hak Pakai on state-owned land. A strata title building may only be sold after the a regional government grants the occupation permit (Iljin layak huni). The term of the strata title, together with its extension, depends on the title of the underlying common land (i.e. Hak Milik, HGB and Hak Pakai) that has been issued. The process of obtaining strata title certificates commences with the construction of the strata title building. Prior to construction, the developer must obtain a building licence from a local government. The application form must indicate the purpose of the use of the strata title i.e for residential or non residential or both. Aside from the building licence, the developer must prepare the specification clearly showing the boundaries of each strata title unit, common area, common land and common property and their proportional ratio value which must be authorised by the second level of local government. If the specification provides the necessary details and is authorised by the local government, the local government will issue the building licence and the developer may begin construction of the strata title buildings. The specification will be used as the basis for preparing the separation deed for the strata title. Upon completion of the construction of the strata title the developer must obtain the occupation permit. The local government will issue the occupation permit after conducting an inspection of the architecture, construction, installation and other supporting facilities of the strata titles building. The next step is to prepare a separation deed which shows a drawing and description of the separation between the units and common area, the common land and the common property, as well as the vertical and horizontal boundaries. The separation deed is subject to approval by the second level of local government and will be used as the basis for issuing the strata titles certificates. After the separation deed is certified and registered and the local land office issues the land book of the strata title, the strata title certificate for each unit is issued under the registration name of the developer. The strata titles certificate consists of (a) an excerpt of the land book of the strata title, (b) an excerpt of the measurement letter/the drawing layout of the common land and (c) the drawing layout of the strata titles showing their level and location.
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Overview of relevant laws and regulations in Indonesia After the issuance of the strata titles certificates, the underlying common land title certificate is retained and deposited in the local land office with a record that the strata title certificates have been issued. The strata title can only be transferred to other third party once the strata title certificate is issued. The transfer of strata title certificate for the first time is carried out between the developer and purchaser by entering into a sale and purchase deed before the land deed official. The land official deed must be registered at the local land office, together with, among others, the strata title certificate registered under the name of the developer and the rules and regulations of the residents association. Having examined all the required supporting documents, the local land office will record the transfer of title and annotate the name of the developer into the name of the purchaser in the strata title certificate as the new owner of the strata title. Build, Operate and Transfer or BOT. BOT is a form of right to utilise a piece of land, wherein a private entity receives certain rights from the land owner to finance, design, construct and operate a facility on the land for a specified period, after which the ownership of the building is transferred with the land back to the land owner. A BOT Scheme is a common structure in Indonesia for construction of commercial buildings where the land owner owns the relevant BOT Land. Under the BOT Scheme, the BOT Grantor agrees to grant certain rights over the BOT Land based on the BOT Agreement to the BOT Grantee. The BOT Grantee can develop the site subject to the relevant approvals and then operate the buildings constructed on the land for the certain use, such as retail shopping centre developments, for a particular period of time as stipulated in the BOT Agreement. For the right to utilise the BOT Land, the BOT Grantee is obliged to pay a certain compensation to the BOT Grantor as stipulated in the BOT Agreement. The period of BOT Agreements is subject to the parties agreement but commonly ranges from 20 to 30 years and may be extended upon agreement of both parties. Upon the expiry of the term of the BOT Agreement, the BOT Grantee must return the BOT Land together with the improvements without either party paying any form of compensation to the other. The BOT Scheme and cooperation arrangement is essentially a contractual arrangement and governed by Indonesian Civil Code Contract Law. Pursuant to Article 1338 of the Indonesian Civil Code the contracting parties are free to arrange their relationship in the BOT Agreement or Cooperation Agreement (freedom of contract) subject to, among others, the prevailing laws and regulations, the good faith of the contracting parties and public policy principles. During the term of the BOT Agreement, the BOT Grantee has full rights to use the BOT Land and buildings as agreed between the parties, including to operate the buildings as shopping mall, to receive rent from tenants occupying the building and to appoint parties to conduct activities on or to the BOT land and premises such as building managers in the case of retail shopping centre developments. Lease Agreement. The right to use land and buildings, as is similar in many other jurisdictions can also be granted through lease-hold arrangements. In general, no limitation on citizenship should apply under this arrangement pursuant to the principle of freedom of contract as set out above. Share Ownership. A foreign indirect ownership of land and building through a PMA Company scheme may also provide the rights of a foreign shareholder, such as LMIR Trust, in the Property Companies to enjoy the beneficial benefits from the Property Companies owning the Property. Indonesian law deems a PMA Company as an Indonesian legal person and as such, a PMA Company has all the rights granted to Indonesian legal persons including to own, manage and operate property developments. The rights of such foreign shareholders are protected by Law No. 25 Year 2007, regarding Investment and Law No. 1 Year 1995 regarding Company Law. Such relevant protections include the repatriation guarantee on profits obtained by the Property Companies and acknowledgement as a shareholder of the Property Companies with the rights and obligation to be represented on the Board of Directors and Board of Commissioners. The licence of a PMA Company is issued by the Capital Investment Board (BKPM). REGULATION ON THE DEVELOPMENT AND USE OF LAND Before a parcel of land can be used for certain purposes, such as housing and its related facilities or shopping complex, an environmental impact analysis must be carried out for the proposed project. Thereafter, such person, or the contractor who is responsible for the construction as instructed and
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Overview of relevant laws and regulations in Indonesia authorised by the land owner, shall obtain a building licence / Izin Mendirikan Bangunan (IMB) from the local regional government. After that, the person may commence the construction or development of the land including the clearance and preparation for the construction of infrastructure including drainage system, roads, landscaping, street lighting, electricity and telephone cables. As the constructions may be conducted in various phases, an IMB must be obtained for each phase to construct building(s) on top of the land, which is already outfitted with the infrastructure as referred above. The development of a housing complex must also comply with the requirement of procurement for public and social facilities which shall be provided for the public benefit such as schools, sport facilities, places of worship (e.g. mosques, churches), markets, parks, playgrounds and others. TRANSFER OF THE PROPERTY The transfer of property is done through a deed of transfer made before the local land deed officer. There will be certain taxes payable by both the vendor and the purchaser before a deed of transfer can be executed. The current rate of tax is 5.0% of the transfer amount or the valuation used for Land and Building tax purposes, whichever is the higher, and such tax is payable by both the vendor and the purchaser. Following the signing of such deed of transfer, the Land Deed Official (Pejabat Pembuat Akta Tanah, or PPAT) who is normally a local notary will then submit an application to the national land office where the property is located, to register the name of the new owner in the Land Book at such National Land Board (Badan Pertanahan Negara; or BPN) as well as on the Land Certificate. The abovementioned procedures are also applicable for the transfer of Strata Title interests in property. Under the present regulations, a developer can only transfer or sell units or offices in such a building after the Strata Title (Hak Milik Atas Satuan Rumah Susun) over the Hak Milik / HGB / Hak Pakai Atas Tanah Negara and Hak Pengelolaan titles of the land where the building is constructed has been issued. Once this has been issued, the developer may apply for separation of the common areas. The application must also include detailed boundaries of each unit or office in the form of sketch plans. A certificate of ownership rights in a unit or office is issued to each of the transferees upon application. The ownership rights in a unit or office also include rights over the common areas, which together constitute an inseparable part of the unit or office concerned. The property under the BOT Scheme is not allowed to be transferred to a third party since the BOT Grantee must deliver the property to the BOT Grantor at the expiry of the BOT Agreement without any compensation. However, the interest of the properties under the BOT Scheme can be transferred by assignment of rights under the BOT Agreement or by way of transfer of shares of the shareholders of the BOT Grantee. In accordance with the Indonesian law, the assignment of rights under the BOT Agreement will require acknowledgment or consent from the BOT Grantor. The BOT Agreements do not provide provisions regarding the party who may receive the assignment, except for The Plaza Semanggi BOT Agreement which specifically states that the assignment may be designated to (i) other third parties or banks or financial institutions who finance the construction or (ii) other third party appointed by them, provided that the BOT Agreement will bind the transferee. With respect to the transfer of shares of the shareholders of the BOT Grantee, except for the Cibubur Junction BOT Agreement which requires prior consent from the BOT Grantor, the BOT Agreements are silent on the consent for transfer of shares of the shareholders of the BOT Grantee. In the absence of an express provision of the transfer of shares in the BOT Agreements, the transfer of shares of the shareholders of the BOT Grantees is not prohibited. MORTGAGE OF THE PROPERTY Subject to the type of land rights and provisions of the relevant agreements, such as the BOT Agreement, the Properties may be used as a security and therefore encumbered with a Mortgage (Hak Tanggungan). The Mortgage shall be set out in a deed made before a local land deed officer and registered at the relevant national land office. As evidence of the mortgage, BPN will make a notation of the Land Book noting the mortgage and issue a mortgage certificate.
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Overview of relevant laws and regulations in Indonesia REGULATION OF THE INDONESIAN ENVIRONMENTAL LAWS AND REGULATIONS Environmental protection in Indonesia is governed by various laws, regulations and decrees of which the Properties are subject, Under the Decree of State Minister for Environmental Affairs No. 17/2001 dated May 22, 2001 concerning Business and/or Action Plans which must be completed with Analysis of Environmental Impact, an Analysis of Environmental Impacts must be conducted on some of the Properties to study the major and significant impacts on businesses and/or activities planned in a particular environment which will be needed for the process of making decisions on the execution of the businesses and/or activities. Pursuant to Government Regulation No. 27 of 1999 dated May 7, 1999 concerning Analysis of Environmental Impacts, the Analysis of Environmental Impacts constitutes a requirement which must be fulfilled to obtain a license to conduct a business and/or activity from the competent authority. An Assessment Committee formed by the Indonesian government will evaluate the Analysis of Environmental Impacts based on the framework of reference, the environmental impact assessment report, or AMDAL report, an environmental management plan (RKL) and an environmental monitoring plan (RPL). A framework of reference is the scope of the analysis of environmental impacts which will be the result of scope-delineation. AMDAL is a careful and in-depth study of the major and significant impacts of a business and/or activity plan. RKL is a plan to handle the major and significant impacts on the environment as the consequence of a business and/or activity plan. RPL is a plan to monitor the components of the environment exposed to the major and significant impacts as the consequence of a business and/or activity plan. For other business plans which do not have to be completed with the AMDAL document, an Environment Management Efforts (UKL) and Environment Monitoring Efforts or UPL would have to be prepared. Under Law No. 23 of 1997 dated September 19, 1997 concerning Environmental Management, the Properties are also subject to regulations relating to the management of certain materials and waste and are required to obtain a licence in order to operate, and to reduce, process and accumulate such waste . Such licences may be revoked and operations may be required to cease if the regulations relating to such waste are violated. REGULATION ON MODERN AND PRIVATE MARKET BUSINESS Under the Decision of the Minister of Trade and Industry of the Republic of Indonesia No. 107/MPP/Kep/2/ 1998, dated 27 February 1998 on the Provisions and Procedures for the Granting of Modern Market Business Licences (IUPM), every company that engages in modern market business activities must be obligated to obtain a Modern Market Business Licence. Modern market is defined as markets established by government, private companies, and cooperatives in the forms of malls, supermarkets, department stores and shopping centres, the management of which must be carried out in a modern manner that prioritises comfort in shopping with a single management, having relatively strong capital with use of fixed price labels. The IUPM is granted by the Minister of Trade and Industry and is valid so long as the company engages in modern market activities. The IUPM is issued based on the domicile or location of the modern market and the company must obtain a new IUPM if the domicile or location of the modern market is changed. The modern market is obliged to cooperate with small and medium scale enterprises and cooperatives and traditional markets under a partnership pattern. If it fails to do this, a written warning letter will be given by the Directorate General of Domestic Trade and the IUPM can be frozen for 6 months period as of the issuance of the warning letter. A Modern Market company that has obtained an IUPM is obliged to submit a report once every 6 months at the latest on 15 July and 15 January to the Director General of Domestic Trade though the Minister of Trade and Industry may from time to time request the company to submit a report on its business activities. A written warning will be given to a modern market company that has obtained an IUPM if, among other things, it does not submit the periodical report or carries out business that is not in accordance with its IUPM. The IUPM can be revoked if it is obtained on the basis of incorrect or forged information, or if on the lapse of the period of the warning letter the company has not performed its obligations required above the modern market company or has been found guilty by a final and binding court decision of violation of Intellectual Property or of committing a criminal offence.
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Overview of relevant laws and regulations in Indonesia Further, pursuant to Regional Regulation of DKI Jakarta Province No. 2 of 2002, dated 28 June 2002 regarding Private Markets in DKI Jakarta Province, every operation of a private market must obtain written approval from the Governor of DKI Jakarta. Private markets includes stores, malls, supermalls, plazas and shopping centres. The private market operational licence is valid as long as the company still engages in the private market activities, provided that the registration must be conducted once every five years. The private market activities must include the partnership formation of a cooperation of small scale enterprises or cooperatives, paying tax and retribution obligations, and informing the DKI Jakarta Governor in writing if the private market activities are no longer conducted or are transferred to other parties. Any individual or company that engages in private market activities without obtaining the licence will be sentenced to imprisonment for a maximum of three months, or will be fined a maximum of Rp. 5,000,000 and or will receive administrative sanctions such as the temporary closing of the private market location. REGULATION ON TRANSFER OF SHARES On 16 August 2007, the Indonesian government enacted Law No. 40 of 2007 on Limited Liability Company (the New Company Law). Based on the New Company Law, there are two approaches on the transfer of shares, i.e., a transfer of shares and acquisition. Transfer of Shares A transfer of shares is conducted by way of executing a deed of transfer of shares. A copy of the deed of transfer of shares must be provided to the company. After the execution of the deed of transfer of shares, the Board of Directors of the company must register every transfer of shares (including the date of transfer) in the shareholders register and special register, and must notify any changes regarding the shareholders to the Minister of Law and Human Rights (MOLHR) to be recorded in the Company Registry within 30 days after the date of the registration of the transfer of shares. The New Company Law stipulates that if the Board of Directors does not notify the MOLHR of such transfer of shares, the MOLHR may reject the subsequent approval or notification which will be submitted to the MOLHR based on the shareholding composition and the name of the new shareholders. In practice, the notification on the transfer of shares will be conducted by a notary through an online system. The MOLHR will issue a receipt of notification once the MOLHR receives such notice. In addition, transfers of shares in public companies are subject to laws and regulations applicable to public companies. Acquisition: An acquisition is defined as a share acquisition which results in a change of control in the company. The New Company Law differentiates the acquisition through the Board of Directors of the target company or directly through the shareholders. If the acquisition will be conducted through the Board of Directors, the Board of Directors of the target company and the acquiring company must prepare an acquisition plan, which should contain at least the following information: (a) (b) (c) name and domicile of the target company and the acquiring company; reasons and explanations from the Board of Directors of the target company and the acquiring company; financial statements (comprising at least the balance sheet in the preceding financial year consolidated with the balance sheet in the previous financial year, profit and loss statement from the relevant financial year, cash flow statement, and equity movement report including notes on the financial statements) of each the acquiring company and the target company; procedures for valuation and conversion of shares of the target company to the shares to be sold in exchange for the sale of shares, if the payment is made by way of exchange of shares; number of shares to be acquired; source of funding;
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(d) (e) (f)

Overview of relevant laws and regulations in Indonesia (g) (h) (i) (j) (k) pro forma balance sheet of the acquiring company prepared in accordance with the prevailing Indonesian GAAP; method for settling the rights of shareholders who disagree with the acquisition plan; method for settling the status, rights, and obligations of the members of the Board of Directors, the Board of Commissioners, and employees of the target company; estimated timeline for completing the acquisition, including timeline to give an authorization for the transfer of shares from the shareholders to the Board of Directors; draft amendments to the Articles of Association of the target company as a result of the acquisition (if these are required).

The requirement to prepare this acquisition plan does not apply to acquisitions that are conducted directly through the shareholders. If the acquisition is conducted through the Board of Directors, the Board of Directors of the acquiring company should do the following not later than 30 days prior to the date of notice of Extraordinary General Meeting of Shareholders (EGMS): (a) (b) announce the summary of the acquisition plan in at least one Indonesian national newspaper; and announce the acquisition plan in writing to the employees.

The provision on such announcement also applies to acquisitions conducted directly through the shareholders. Following the announcement, creditors may file an objection with the company within 14 days after the announcement. If there is any objection that cannot be settled until the date of the EGMS, that objection must be presented to the EGMS for resolution. Further, pursuant to the New Company Law, the acquisition cannot be completed if the objections of the creditors have not been resolved. The New Company Law explictly states that the obligation of the announcement above is applied for the acquiring company. However, some legal practicioners intepret that the announcement requirement also applies to the target company.

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Taxation
SINGAPORE TAX IMPLICATIONS The following summary of certain Singapore income tax consequences of the purchase, ownership and disposition of the Units is based upon laws, regulations, rulings and decisions now in effect, all of which are subject to change (possibly with retroactive effect). The summary does not purport to be a comprehensive description of all of the tax considerations that may be relevant to a decision to purchase, own or dispose of the Units and does not purport to apply to all categories of investors, some of which may be subject to special rules. Investors should consult their own tax advisers concerning the application of Singapore income tax laws to their particular situations as well as any consequences of the purchase, ownership and disposition of the Units arising under the laws of any other taxing jurisdiction. Taxation of LMIR Trust LMIR Trust is liable to Singapore income tax on: income accruing in or derived from Singapore; and unless otherwise exempt, income derived from outside Singapore which is received in Singapore or deemed to have been received in Singapore by the operation of law. Dividends from the Target Singapore SPCs LMIR Trusts income will comprise substantially dividends received from its holding of ordinary shares in the Target Singapore SPCs. Provided that the Target Singapore SPCs are tax residents of Singapore for income tax purposes, these dividends will be one-tier (tax-exempt) dividends and hence exempt from tax in the hands of the Trustee. Gains on disposal of shares Singapore does not impose tax on capital gains. In the event that LMIR Trust disposes of its ordinary shares or redeemable preference shares or both in the Target Singapore SPCs, gains arising from such a disposal will not be liable to Singapore income tax unless the gains are considered income of a trade or business. The gains may also be liable to Singapore income tax if the shares were acquired with the intention or purpose of making a profit by sale and not for long-term investment purposes. Gains arising from the sale of the ordinary shares or redeemable preference shares or both in the Target Singapore SPCs, if considered to be trading gains, will be taxable on the Trustee. Redemption of redeemable preference shares in the Target Singapore SPCs Any proceeds received by LMIR Trust from the redemption of its redeemable preference shares in the Target Singapore SPCs at the original cost of the redeemable preference shares are capital receipts and hence not taxable on the Trustee. Taxation of the Singapore SPCs The Singapore SPCs are liable to Singapore income tax on: income accruing in or derived from Singapore; and unless otherwise exempt, income derived from outside Singapore which is received in Singapore or deemed to have been received in Singapore by the operation of law. Dividends from the Indonesian SPCs Provided that the Singapore SPCs are tax residents of Singapore for income tax purposes, any dividends received in Singapore by the Singapore SPCs from the Indonesian SPCs will be exempt from Singapore income tax under Section 13(8) of the Income Tax Act, if the following conditions are met: in the year the dividends are received in Singapore, the headline corporate tax rate in Indonesia is at least 15.0%;
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Taxation the dividends have been subject to tax in Indonesia; and the Singapore Comptroller of Income Tax is satisfied that the tax exemption would be beneficial to the Singapore SPCs. Based on the current tax laws in Indonesia, dividends paid by the Indonesian SPCs out of their income from the letting of the Properties will meet the aforesaid conditions (see Indonesian Tax Implications). Interest from the Indonesian SPCs LMIR Trust has obtained approval of the IRAS to exempt the interest received by the relevant Singapore SPCs on the loans extended to the Indonesian SPCs from Singapore income tax under Section 13(12) of the Income Tax Act. This approval is subject to the relevant Singapore SPCs satisfying certain stipulated conditions, including the condition that the full amount of the remitted interest, less attributable expenses, must be distributed to LMIR Trust. Gains on disposals of shares Singapore does not impose tax on capital gains. In the event that the Singapore SPCs dispose of their ordinary shares in the Indonesian SPCs, gains arising from such a disposal will not be liable to Singapore income tax unless the gains are considered income of a trade or business. The gains may also be liable to Singapore income tax if the shares were acquired with the intention or purpose of making a profit by sale and not for long-term investment purposes. Gains arising from the sale of ordinary shares in the Indonesian SPCs, if considered to be trading gains, will be assessed to tax on the Singapore SPCs. Repayment of loans by the Indonesian SPCs Any proceeds received by the Singapore SPCs from repayment of principal on the loans by the Indonesian SPCs are capital receipts and hence not taxable on the Singapore SPCs. Taxation of Unitholders Distributions by LMIR Trust Subject to LMIR Trusts distribution policy (see Distributions), LMIR Trusts distributions will mainly be made out of the following receipts: one-tier (tax-exempt) dividends received from the Target Singapore SPCs ( the tax-exempt income); and capital receipts from the redemption of redeemable preference shares in the Target Singapore SPCs. Distributions out of tax-exempt income Unitholders will be exempt from Singapore income tax on distributions made out of LMIR Trusts taxexempt income. For this purpose, the amount of tax-exempt income distributions that LMIR Trust can distribute for a distribution period will be to the extent of the amount of tax-exempt income that it has received and is entitled to receive in that distribution period. Distributions made out of any amount of Distributable Income for a distribution period which LMIR Trust received or is entitled to receive as its own tax-exempt income after the end of that distribution period will be treated as capital distributions and the tax treatment set out under Distributions out of capital receipts will apply. The amount of such tax-exempt income may be used to frank tax-exempt income distributions out of Distributable Income for subsequent distribution periods. Distributions out of capital receipts Unitholders will not be subject to Singapore income tax on distributions made by LMIR Trust out of its capital receipts, i.e. amounts received from the redemption of redeemable preference shares in the Target Singapore SPCs. Such distributions will be treated as returns of capital for Singapore income tax purposes. For Unitholders who hold the Units as trading or business assets and are liable to Singapore income tax on gains arising from disposal of the Units, the amount of such distributions will
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Taxation be applied to reduce the cost of the Units for the purpose of calculating the amount of taxable trading gain when the Units are disposed of. If the amount exceeds the cost or the reduced cost of the Units, as the case may be, the excess will be subject to tax as trading income of such Unitholders. Distributions out of gains from the disposal of shares in the Target Singapore SPCs Distributions made out of gains from the disposal of shares in the Target Singapore SPCs, that is if the Manager exercises its discretion to distribute such gains, will: not be assessable to tax on the Unitholders if the gains are determined to be capital gains for Singapore income tax purposes, unless the distributions are considered gains or profits of a trade or business carried on by the Unitholder, for example, if the Units are held as trading assets; and not be subject to further Singapore income tax in the hands of Unitholders if the gains are determined to be trading gains for Singapore income tax purposes. Tax on such trading gains will be assessed on the Trustee. Disposal of Units Singapore does not impose tax on capital gains. Any gains on disposal of the Units are not liable to Singapore income tax provided the Units are held as investment assets. Where the Units are held as trading assets, any gains on disposal of the Units are liable to Singapore income tax under Section 10(1)(a) of the Income Tax Act. Where the Units are acquired with the intention or purpose of making a profit by sale and not with the intention to be held as long-term investments, any gains on disposal of the Units could be construed as gains or profits of an income nature liable to tax under Section 10(1)(g) of the Income Tax Act. Stamp duty Stamp duty will not be imposed on instruments of transfers relating to the Units. In the event of a change of trustee of LMIR Trust, stamp duty on any document effecting the appointment of a new trustee and the transfer of the trust assets from the incumbent trustee to the new trustee will be charged at a nominal rate not exceeding S$10.00 as specified under Article 3(g)(ii) of the First Schedule to the Stamp Duties Act, Chapter 312 of Singapore. INDONESIA TAX IMPLICATIONS Tax implications on the Retail Malls portion of the LMIR Trust Structure: On the transfer of shares in Indonesian SPCs to Singapore SPCs Any capital gain from the transfer of shares in Indonesian SPCs to Singapore SPCs is subject to tax pursuant to Article 17 of Income Tax Law No. 17/2000 with a maximum rate of 30.0% and the liability for such capital gains tax is the sole obligation of the Vendors. Tax implication for the Tenants On the Rental Payments to the Indonesian SPCs Article 4(2) Withholding Income Tax The payment of rental on land and/or buildings leased by the Tenants to the Indonesian SPCs will be subject to a 10.0% final withholding income tax on the gross value of the land and/or buildings rental. However, if the tenants of the Retail Malls are not appointed tax withholder (i.e. individuals), then the final income tax must be paid directly by the Indonesian SPCs (not using the withholding system).
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Taxation Tax implication for the Indonesian SPCs On the rental payments received from the Tenants Corporate Income Tax The rental income received from the Tenants will be subject to final income tax (Withholding article 4(2) Income Tax) at the rate of 10.0%. Because the rental income has already been subjected to the final income tax, the said income should not be combined with other non-final income in calculating the corporate income tax due for the corresponding tax year. The imposition of final income tax to the rental income treated as income for the Indonesian SPCs and the income tax of 10.0% withheld by the Tenants will be treated as payment for the corporate income tax due for the respective Indonesian SPCs. The imposition of final income tax does not mean that the income from the lease of land and/or buildings does not need to be reported in the Annual Corporate Income Tax Return (SPT Tahunan PPh Badan) of the Indonesian SPCs. The rental income must be reported in the Indonesian SPCs returns, however it should not be combined with other non-final income in calculating the income tax due for the corresponding tax year. VAT on the Rental of Land and/or Building The Indonesian SPCs must charge 10.0% VAT on the rental of land and/or building (taxable service) to the Tenants. On the payment of Management Fee to the Property Manager Article 23 withholding income tax The Indonesian SPCs must withhold article 23 income tax at the rate of 4.5% from the payment of management fees to the Property Manager. This 4.5% withholding tax will be treated as prepaid tax for the Property Manager. Please be advised that according to Article 13 of Law No. 16/2000 regarding General Tax Provisions and Procedures, the Directorate General of Taxation shall have the authority to conduct audit or verification within a 10 years period after the end of fiscal year or fiscal period. Tax implications on the Retail Spaces portion of the LMIR Trust Structure Tax implication for the Master Lessee On the transfer of title of land and/or buildings Capital Gains Tax Any capital gain received by the Master Lessee from the transfer of title of land and/or buildings (i.e., Retail Spaces) to the Indonesian SPCs is subject to tax pursuant to Article 17 of Income Tax Law No. 17/ 2000 with a maximum rate of 30.0% and the liability for such capital gains tax is the sole obligation of the Master Lessee. Income Tax on the Transfer of Title of Land and/or Buildings The transfer of title of Land and/or Buildings by the Master Lessee will be subject to 5.0% income tax as stipulated by Government Regulation No. 79/1999, which can be treated as tax credit in calculating the amount of tax due for corporate income tax for the Master Lessee. VAT Considering that the Master Lessee is a Taxable Entrepreneur, the Master Lessee needs to charge 10.0% VAT on the transfer. This VAT will be treated as input tax for the Indonesian SPCs and will be offset against Indonesian SPCs output tax (i.e. VAT charged by the Indonesian SPCs to the Master Lessee on the rental fee) to arrive at the amount of VAT due to the state treasury.
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Taxation On the rental payments to the Indonesian SPCs Article 4(2) Withholding Income Tax The payment of rental on land and/or buildings leased by the Master Lessee to the Indonesian SPCs will be subject to 10.0% final withholding income tax on the gross value of the land and/or buildings rental. VAT Given the fact that the Master Lessee is a Taxable Entrepreneur, then the 10.0% VAT charged by the Indonesian SPCs on the rental payments should be treated as input tax for the Master Lessee (to be offset against its output tax to arrive at the amount of VAT due to the state treasury). Tax implication for the Indonesian SPCs On the transfer of title of land and/or buildings Property Title Acquisition Duty As stipulated by Law No. 20/2000, the Indonesian SPCs must pay the Property Title Acquisition Duty at the rate of 5.0% from the amount of the actual selling price or from the sales value of tax object (predetermined value for tax calculation purposes), whichever is higher. VAT Considering that the Indonesian SPCs are Taxable Entrepreneurs, then the 10.0% VAT charged by the Master Lessee on the transfer should be treated as input tax for the Indonesian SPCs (to be off set against the output tax from the rental fee to arrive at the amount of VAT due to the state treasury). On the rental income received from the Master Lessee Corporate Income Tax The rental income received from the Master Lessee will be subject to final withholding income tax (Withholding article 4(2) Income Tax) at the rate of 10.0% because the rental income has already subjected to the final income tax, then the said income should not be combined with other non-final income in calculating the corporate income tax due for the corresponding tax year. The rental income received from the Master Lessee will be treated as income for the Indonesian SPCs and the income tax of 10.0% withheld by the Master Lessee will be treated as payment for the corporate income tax due for the respective Indonesian SPCs. The imposition of final income tax does not mean that the income from the lease of land and/or buildings does not need to be reported in the Annual Corporate Income Tax Return (SPT Tahunan PPh Badan) of the Indonesian SPCs. The rental income must be reported in the annual tax return, however, the income should not be combined with other nonfinal income in calculating the income tax due for the corresponding tax year. VAT The Indonesian SPCs must charge 10.0% VATon the rent of land and/or building (taxable service) to the Master Lessee. This VATshould be treated as input tax for the Master Lessee and to be offset against its output tax to arrive at the amount of VAT due to the state treasury. Payment of Shareholders Loans and related interest from Indonesian SPCs to Singapore SPCs Tax implications for the Indonesian SPCs The Repayment of Principal from Shareholders Loans The repayment of principal from the shareholders loans will not be subject to any form of Indonesian tax as there are no thin capitalisation rules in Indonesia. The Payment of Interest on Shareholders Loan The Indonesian tax rules generally require a twenty percent (20%) tax to be withheld on the payment of interest from an Indonesian taxpayer to an offshore tax resident. Under the tax treaty between Singapore and Indonesia, the rate of withholding tax is reduced to ten percent (10%) on the payment of interest to Singapore tax resident beneficial owner of the interest. The reduced rate is
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Taxation available to a Singapore company only if the company submits an original copy of its certificate of domicile to the Indonesian payor prior to the payment of the interest. On 7 July 2005, the Directorate General of Taxation in Indonesia issued a circular letter indicating that the benefits of Indonesias tax treaties would not be available to a recipient of Indonesian-sourced income who was not the beneficial owner of such income. The circular letter further elaborated that a special purpose vehicle which is a conduit company, paper box company, pass-through company or any similar form of entity would not qualify as the beneficial owner of payments received by it. It remains uncertain as to how the Indonesian tax authorities will decide whether or not the Singapore SPCs are the beneficial owners of interest received from the Indonesian SPCs. In the event that the Singapore SPCs were viewed by the Indonesian tax authorities as conduit companies or pass-through companies, and therefore not the beneficial owners of interest received from the Indonesian SPCs, the Unitholders of LMIR Trust should in that case be viewed as the beneficial owners of the interest. In that case it should still be possible to take the position that the reduced rate of withholding tax is applicable, to the extent that the Unitholders are tax resident in Singapore or any other jurisdiction with the same tax rate under their respective tax treaty. Payment of dividends from Indonesian SPCs to Singapore SPCs Tax implications for the Indonesian SPCs VAT on the Payment of Dividends There will be no VAT on the payment of dividends. Article 26 Withholding Income Tax on the Payment of Dividends The Indonesian tax rules generally require a 20.0% tax to be withheld on the payment of a dividend from an Indonesian taxpayer to an offshore tax resident. Under the tax treaty between Singapore and Indonesia, the rate of withholding tax is reduced to 10.0% on the payment of a dividend to Singapore tax resident beneficial owner of the dividend. The reduced rate is available to a Singapore company only if the company submits an original copy of its certificate of domicile to the Indonesian payor prior to the payment of the dividend. As stated above, the Directorate General of Taxation in Indonesia issued a circular letter indicating that the benefits of Indonesias tax treaties would not be available to a recipient of Indonesian-sourced income who was not the beneficial owner of such income. The circular letter further elaborated that a special purpose vehicle which is a conduit company, paper box company, pass-through company or any similar form of entity would not qualify as the beneficial owner of payments received by it. It remains uncertain as to how the Indonesian tax authorities will decide whether or not the Singapore SPCs are the beneficial owners of dividends received from the Indonesian SPCs. In the event that the Singapore SPCs were viewed by the Indonesian tax authorities as conduit companies or pass-through companies, and therefore not the beneficial owners of dividends received from the Indonesian SPCs, the Unitholders of LMIR Trust should in that case be viewed as the beneficial owners of the dividends. In that case it should still be possible to take the position that the reduced rate of withholding tax is applicable, to the extent that the Unitholders are tax resident in Singapore or any other jurisdiction with the same tax rate under their respective tax treaty.

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Plan of distribution
The Manager is making an offering of 645,469,000 Units (representing approximately 60.9 % of the total number of Units in issue after the Offering) for subscription at the Offering Price under the Placement and the Public Offer. 625,469,000 Units are being offered under the Placement and 20,000,000 Units are being offered under the Public Offer. Units may be re-allocated between the Placement and the Public Offer at the discretion of the Underwriters (subject to the minimum unitholding and distribution requirement of the SGX-ST), such as in the event of excess applications in one and a deficit of applications in the other. The Public Offer is open to members of the public in Singapore. Under the Placement, the Manager intends to offer the Units by way of an international placement through the Underwriters to investors, including institutional and other investors in Singapore. Subject to the terms and conditions set forth in the Underwriting Agreement entered into among the Sponsor, the Manager, the Unit Lender and the Underwriters on 9 November 2007, the Manager has agreed to effect for the account of LMIR Trust the issue of, and the Underwriters have agreed to severally (and not jointly) subscribe, or procure subscribers for, the number of Units, set forth opposite their respective names below.
Underwriters Number of Units under the Offering

UBS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . BNP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . OCBC Bank . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

322,734,500 161,367,250 161,367,250 645,469,000

The Units are being offered at the Offering Price. The Offering Price per Unit under the Placement and the Public Offer is identical. The Underwriters have agreed to subscribe and pay for, or procure the subscription and payment for 625,469,000 Units at the Offering Price, less the Underwriting, Selling and Management Commission to be borne by LMIR Trust. Lippo Strategic, as Unit Lender, will bear the Underwriting, Selling and Management Commission in respect of any Units that are subsequently sold pursuant to the exercise of the Over-allotment Option. The Manager and the Sponsor have agreed in the Underwriting Agreement to indemnify the Underwriters against certain liabilities. The Underwriting Agreement also provides that the obligations of the Underwriters to subscribe and pay for or procure the subscription or payment for the Units in the Offering are subject to the satisfaction of certain conditions contained in the Underwriting Agreement. The Underwriting Agreement may be terminated by the Underwriters at any time prior to payment being made for the Units, upon the occurrence of certain events in accordance with the terms of the Underwriting Agreement. If the Underwriters are released and discharged from their obligations under the Underwriting Agreement, this Offering will be cancelled and any moneys received in connection with this Offering will be returned to prospective investors without interest or any share of the revenue arising therefrom. Subscribers of the Units may be required to pay brokerage (and if so required, such brokerage will be up to 1.0% of the Offering Price) and applicable stamp duties, taxes and other similar charges (if any) in accordance with the laws and practices of the country of subscription, in addition to the Offering Price. The Underwriters and their respective affiliates may engage in transactions with, and perform services for, the Trustee, the Manager, the Sponsor and LMIR Trust in the ordinary course of business and have engaged, and may in the future engage, in commercial banking and/or investment banking transactions with the Trustee, the Manager, the Sponsor and LMIR Trust, for which they have received, or may in the future receive, customary compensation. OVER-ALLOTMENT AND STABILISATION The Unit Lender has granted the Over-allotment Option to the Underwriters for the purchase of up to an aggregate of 96,820,000 Units at the Offering Price. The number of Units subject to the Over-allotment Option will not be more than 15.0% of the number of Units under the Placement and the Public Offer. The Stabilising Manager may exercise the Over-allotment Option in full or in part, on one or more occasions, no
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Plan of distribution later than the earliest of (i) the date falling 30 days from the commencement of trading of the Units on the SGX-ST, (ii) the date when the Stabilising Manager has bought on the SGX-ST, an aggregate of 96,820,000 Units, representing not more than 15.0% of the total Units offered, to undertake stabilising actions or (iii) the date falling 30 days after the date of adequate public disclosure of the final price of the Units, solely to cover over-allotments of Units (if any) in connection with the Offering, subject to applicable laws and regulations. In connection with the Over-allotment Option, the Stabilising Manager and the Unit Lender, have entered into a unit lending agreement (the Unit Lending Agreement) dated 9 November 2007 pursuant to which the Stabilising Manager may borrow up to an aggregate of 96,820,000 Units from the Unit Lender for the purpose of facilitating settlement of the over-allotment of Units (if any) in connection with the Offering. The Stabilising Manager will re-deliver to the Unit Lender such number of Units which have not been purchased pursuant to the exercise of the Over-allotment Option. In connection with the Offering, the Stabilising Manager (or persons acting on behalf of the Stabilising Manager) may, in consultation with the other Underwriters, over-allot or effect transactions which stabilise or maintain the market price of the Units at levels which might not otherwise prevail in the open market. Such transactions may be effected on the SGX-ST and in other jurisdictions where it is permissible to do so, in each case in compliance with all applicable laws and regulations, including the SFA and any regulations thereunder. However, there is no assurance that the Stabilising Manager (or persons acting on behalf of the Stabilising Manager) will undertake stabilising action. Such transactions may commence on or after the date of commencement of trading of the Units on the SGX-ST and, if commenced, may be discontinued at any time and shall not be effected upon the earliest of (i) the date falling 30 days from the date of commencement of trading of the Units on the SGX-ST, (ii) the date when the over-allotment of the Units which are the subject of the Over-allotment Option has been fully covered (through the purchase of the Units on the SGX-ST and/or the exercise of the Over-allotment Option by the Stabilising Manager, on behalf of itself and the other Underwriters) or (iii) the date falling 30 days after the date of adequate public disclosure of the final price of the Units. Any profit after expenses derived, or any loss sustained, as a consequence of the exercise of the Over-allotment Option or the undertaking of any stabilising activities shall be for the account of the Underwriters. None of the Manager, the Sponsor, the Unit Lender or the Stabilising Manager makes any representation or prediction as to the magnitude of any effect that the transactions described above may have on the price of the Units. In addition, none of the Manager, the Sponsor, the Unit Lender and the Stabilising Manager makes any representation that the Stabilising Manager will engage in these transactions or that these transactions, once commenced, will not be discontinued without notice (unless such notice is required by law). The Stabilising Manager will be required to make a public announcement via SGXNET in relation to the total number of Units purchased by the Stabilising Manager, not later than 12 noon on the next trading day of the SGX-ST after the transactions are effected. The Stabilising Manager will also be required to make a public announcement through the SGX-ST in relation to the cessation of stabilising action and the number of Units in respect of which the Over-allotment Option has been exercised not later than 8.30 a.m. on the next trading day of the SGX-ST after the cessation of stabilising action. LOCK-UP ARRANGEMENTS Lippo Strategic (also the Unit Lender) Lippo Strategic has on 9 November 2007 agreed with the Underwriters that it will not, without the prior written consent of the Underwriters (such consent not to be unreasonably withheld or delayed), directly or indirectly, offer, sell or contract to sell, grant any option to purchase, grant any security over, encumber or otherwise dispose of, or enter into any transaction which is designed to, or might reasonably be expected to, result in the sale or disposition (whether by actual sale or disposition or effective economic sale or disposition due to cash settlement or otherwise) of (i) any or all of its direct interest in the Cornerstone Units (or any securities convertible into or exchangeable for the Cornerstone Units or which carry any rights to subscribe for or purchase Cornerstone Units) (adjusted for any bonus issue, consolidation or subdivision) as at Listing Date during the First Lock-Up Period; and (ii) more than 50.0% of its direct interest in the Cornerstone Units (or any securities convertible into or exchangeable for the Cornerstone Units or which carry any rights to subscribe for or purchase Cornerstone Units) (adjusted for any bonus issue, consolidation or subdivision) as at Listing Date during the Second Lock-Up Period.
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Plan of distribution The restriction described in the preceding paragraph does not apply to: the transfer by Lippo Strategic of its direct interest in the Cornerstone Units to and between its whollyowned subsidiaries, provided that each such transferee gives a similar undertaking to the reasonable satisfaction of the Underwriters for the remainder of the First Lock-Up Period and/or the Second Lock-Up Period (as the case may be); and any securities lending arrangement with the Underwriters or any sale or transfer by Lippo Strategic of its direct interest in the Cornerstone Units pursuant to exercise of the Over-allotment Option. The restrictions on Lippo Strategic do not restrict any security granted over or encumbrance created over the Cornerstone Units pursuant to any lending agreement to which Lippo Strategic is a party, provided that the terms of any such security or encumbrance state that it may not be enforced and that Lippo Strategic retains beneficial interest in these Cornerstone Units for the Lock-Up Periods. Lippo Holdings Inc, Lippo Capital Limited, Lippo Cayman Limited and Lanius Ltd Lippo Holdings Inc, Lippo Capital Limited, Lippo Cayman Limited and Lanius Ltd, have on 9 November 2007 each agreed with the Underwriters that it will not, without the prior written consent of the Underwriters (such consent not to be unreasonably withheld or delayed), directly or indirectly, offer, sell or contract to sell, grant any option to purchase, grant any security over, encumber or otherwise dispose of, or enter into any transaction which is designed to, or might reasonably be expected to, result in the sale or disposition (whether by actual sale or disposition or effective economic sale or disposition due to cash settlement or otherwise) of (i) any or all of its direct or indirect interest in the Cornerstone Units (or any securities convertible into or exchangeable for the Cornerstone Units or which carry any rights to subscribe for or purchase Cornerstone Units) (adjusted for any bonus issue, consolidation or subdivision) as at Listing Date during the First Lock-Up Period; and (ii) more than 50.0% of its direct or indirect interest in the Cornerstone Units (or any securities convertible into or exchangeable for the Cornerstone Units or which carry any rights to subscribe for or purchase Cornerstone Units) (adjusted for any bonus issue, consolidation or subdivision) as at Listing Date during the Second Lock-Up Period. The restriction described in the preceding paragraph does not apply to: the transfer by any one of Lippo Holdings Inc, Lippo Capital, Lippo Cayman Limited and Lanius Ltd of its direct or indirect interest in the Cornerstone Units to and between its wholly-owned subsidiaries, provided that each such transferee gives a similar undertaking to the reasonable satisfaction of the Underwriters for the remainder of the First Lock-Up Period and/or the Second Lock-Up Period (as the case may be); and any securities lending arrangement with the Underwriters or any sale or transfer of the direct interest in the Cornerstone Units by Lippo Strategic pursuant to exercise of the Over-allotment Option. MIPL, Mapletree Dextra Pte Ltd and Mapletree LM MIPL, Mapletree Dextra Pte Ltd and Mapletree LM have on 9 November 2007 each agreed with the Underwriters that it will not, without the prior written consent of the Underwriters (such consent not to be unreasonably withheld or delayed), directly or indirectly, offer, sell or contract to sell, grant any option to purchase, grant any security over, encumber or otherwise dispose of, or enter into any transaction which is designed to, or might reasonably be expected to, result in the sale or disposition (whether by actual sale or disposition or effective economic sale or disposition due to cash settlement or otherwise) of (i) any or all of its direct or indirect interest in the Cornerstone Units (or any securities convertible into or exchangeable for the Cornerstone Units or which carry any rights to subscribe for or purchase Cornerstone Units) (adjusted for any bonus issue, consolidation or subdivision) as at Listing Date during the First Lock-Up Period; and (ii) more than 50.0% of its direct or indirect interest in the Cornerstone Units (or any securities convertible into or exchangeable for the Cornerstone Units or which carry any rights to subscribe for or purchase Cornerstone Units) (adjusted for any bonus issue, consolidation or subdivision) as at Listing Date during the Second Lock-Up Period. The restriction described in the preceding paragraph does not apply to the transfer by MIPL, Mapletree Dextra Pte Ltd and Mapletree LM of its direct or indirect interest in the Cornerstone Units to and between its wholly-owned subsidiaries, provided that each such transferee gives a similar undertaking to the
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Plan of distribution reasonable satisfaction of the Underwriters for the remainder of the First Lock-Up Period and/or the Second Lock-Up Period (as the case may be). The Manager The Manager has agreed on 9 November 2007 with the Underwriters that it will not (and will not cause or permit LMIR Trust to), directly or indirectly, without the prior written consent of the Underwriters (such consent not to be unreasonably withheld or delayed): offer, issue, sell, contract to issue or sell, grant any option to purchase, grant security over, encumber or otherwise dispose of, or enter into any transaction (excluding commitments for the sale and purchase of additional properties, whether in the form of a sale and purchase agreement or a put and call option) which is designed to, or might reasonably be expected to, result in the issuance, sale or disposition (whether by actual issuance, sale or disposition or effective economic issuance, sale or disposition due to cash settlement or otherwise) of any Units (or any securities convertible into or exchangeable for Units or which carry rights to subscribe for or purchase Units) (adjusted for any bonus issue, consolidation or subdivision); or make any announcement with respect to any of the foregoing transactions other than as required by applicable laws or regulations during the First Lock-Up Period; and/or during the First Lock-up Period deposit any Units (or any securities convertible into or exchangeable for Units or which carry rights to subscribe for or purchase Units or part thereof) in any depositary receipt facility. The restriction described in the preceding paragraph does not apply to any Units to be issued to the Manager in full or part payment of its fees under the Trust Deed. SGX-ST LISTING LMIR Trust has received a letter of eligibility from the SGX-ST for the listing and quotation of the Units on the Main Board of the SGX-ST. The SGX-ST assumes no responsibility for the correctness of any statements or opinions made or reports contained in this Prospectus. Admission to the Official List of the SGX-ST is not to be taken as an indication of the merits of the Offering, LMIR Trust, the Manager or the Units. It is expected that the Units will commence trading on the SGX-ST on a ready basis on or about 19 November 2007. Prior to this Offering, there has been no trading market for the Units. There can be no assurance that an active trading market will develop for the Units, or that the Units will trade in the public market subsequent to this Offering at or above the Offering Price. (See Risk FactorsRisks Relating to an Investment in the UnitsThe Units have never been publicly traded and the listing of the Units on the Main Board of the SGX-ST may not result in an active or liquid market for the Units.) Issue costs The estimated amount of the costs in relation to the Offering and issuance of the Cornerstone Units of approximately S$32.8 million based on the Offering Price (subject to the Over-allotment Option) includes the Underwriting, Selling and Management Commission, professional and other fees and all other incidental costs in relation to the Offering, which will be borne by LMIR Trust. A breakdown of these estimated costs is as follows:
Estimated expenses (S$000)
(1)

Professional and other fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Underwriting, Selling and Management Commission . . . . . . . . . . . . . . . . . . . . . . . . Miscellaneous offering expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Total estimated expenses of the Offering and issuance of the Cornerstone Units . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

10,660 17,773 4,369 32,802

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Plan of distribution Note: (1) Includes financial advisory, solicitors fees and fees for the Independent Reporting Accountants, the Independent Singapore Tax Adviser, the Independent Indonesian Tax Adviser, both of the Independent Valuers and other professionals fees.

DISTRIBUTION AND SELLING RESTRICTIONS No action has been or will be taken in any jurisdiction that would permit a public offering of the Units or the possession, circulation or distribution of this Prospectus or any other offering or publicity material relating to LMIR Trust or the Units in any country or jurisdiction (other than Singapore, where action for the purpose is required). Accordingly, the Units may not be offered or sold, directly or indirectly, and neither this Prospectus nor any other offering material, circular, form of application or advertisement in connection with the Units may be distributed or published, in or from any country or jurisdiction except under circumstances that will result in compliance with all applicable laws and regulations of any such country or jurisdiction. Australia This Prospectus does not constitute an offer of, or an invitation to purchase, the Units in or to any resident of Australia, other than set out below. Offers of Units under this Prospectus to investors in Australia are only made to those investors who are wholesale clients under section 761G of the Corporations Act 2001 (Cth). If the Units are to be on-sold to investors in Australia without a product disclosure statement within 12 months of issue of the Units, they may only be on-sold to investors in Australia who are wholesale clients under section 761G of the Corporations Act 2001 (Cth). This Prospectus does not and is not intended to constitute a prospectus or product disclosure statement within the meaning of the Corporations Act 2001 (Cth) and neither this Prospectus nor any other prospectus or product disclosure statement has been lodged or registered with the Australian Securities and Investments Commission. No action has been taken by LMIR Trust that would permit a public offering of the Units in Australia. European Economic Area In relation to each Member State of the European Economic Area which has implemented the Prospectus Directive (each, a Relevant Member State), with effect from and including the date on which the Prospectus Directive is implemented in that Relevant Member State (the Relevant Implementation Date), an offer of any Units to the public may not be made in that Relevant Member State prior to the publication of a prospectus in relation to the Units which has been approved by the competent authority in that Relevant Member State or, where appropriate, approved in another Relevant Member State and notified to the competent authority in that Relevant Member State, all in accordance with the Prospectus Directive, except that, with effect from and including the Relevant Implementation Date, an offer to the public in that Relevant Member State of any Units may be made at any time: to legal entities which are authorised or regulated to operate in the financial markets or, if not so authorised or regulated, whose corporate purpose is solely to invest in securities; to any legal entity which has two or more of (i) an average of at least 250 employees during the last financial year, (ii) a total balance sheet of more than e43,000,000 and (iii) an annual net turnover of more than e50,000,000, as shown in its last annual or consolidated accounts; or in any other circumstances which do not require the publication by LMIR Trust of a prospectus pursuant to Article 3 of the Prospectus Directive. For the purposes of this provision, the expression an offer of Units to the public in relation to any Units in any Relevant Member States means the communication in any form and by any means of sufficient information on the terms of the offer and any Units to be offered so as to enable an investor to decide to purchase or subscribe for the Units, as the same may be varied in that Member State by any measure implementing the Prospectus Directive in that Member State and the expression Prospectus Directive means Directive 2003/71/EC and includes any relevant implementing measure in each Relevant Member State.
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Plan of distribution France This Prospectus does not constitute an offer or invitation for the subscription or purchase of Units in France. Neither this Prospectus nor anything contained herein shall form the basis of any contract or any obligation of any kind whatsoever in France. Any person who is in possession of this Prospectus is hereby notified that no action has or will be taken that would allow the offer and marketing of Units in France. Accordingly, the Units may not be marketed, offered, sold or delivered in France, and neither the Units nor any offering material relating to the Units may be distributed or made available in France, except as permitted by French law and regulation. Germany The distribution of the Units has not been and will not be notified to the Bundesanstalt fur Finanzdienstleistungsaufsicht and no documents or other information relating to the Units have been and will be filed with, approved by or notified to the Bundesanstalt fur Finanzdienstleistungsaufsicht in accordance with the German Investment Act (Investmentgesetz), the Securities Prospectus Act (Wertpapierprospektgesetz) or any other present or future applicable laws in Germany and the Units shall not be sold, distributed or promoted in Germany other than in compliance with the Investment Act, the Securities Prospectus Act and any other applicable German laws and regulations. Hong Kong This Prospectus has not been registered and will not be registered as a prospectus under the Companies Ordinance (Cap. 32 of the Laws of Hong Kong). The Units may not be offered or sold in Hong Kong by means of any documents, other than to professional investors within the meaning of section 1 of Part 1 of Schedule 1 to the Securities and Futures Ordinance (Cap. 571 of the Laws of Hong Kong) (SFO) and in accordance with the requirements under the SFO and any rules made under the SFO. No person may have in its possession for the purposes of issue, or issue (in each case whether in Hong Kong or elsewhere), any prospectus, notice, circular, brochure, advertisement, invitation or other document relating to the Units which is directed at, or the contents of which are likely to be accessed or read by, the public in Hong Kong (except if permitted to do so under the laws of Hong Kong) other than with respect to Units which are or are intended to be disposed of (i) only to persons outside Hong Kong or (ii) only to professional investors within the meaning of the SFO and in accordance with the requirements under the SFO and any rules made under the SFO. Indonesia This Prospectus may not be distributed directly or indirectly in Indonesia or to any Indonesian entity or Indonesian citizen (person), and the Underwriters, may not offer or sell, directly or indirectly, any Units in Indonesia or to any Indonesian entity or Indonesian citizen (person), in a manner constituting a public offering of the Units under the Indonesian Capital Markets Law and the applicable regulations of the Capital Market Supervisory Agency. Ireland The Units described in this Prospectus are interests in a collective investment scheme which is not supervised or authorised by the Irish Financial Regulator or approved by the Irish Financial Regulator to market the Units in Ireland. Therefore, no advertising or marketing of Units may take place in Ireland without the prior approval in writing of the Irish Financial Regulator. In addition, any sales or marketing of Units in Ireland must take place in accordance with all applicable provisions of the Irish Investment Intermediaries Act, 1995 (as amended), the Irish Market Abuse (Directive 2003/6/EEC) Regulations 2006 (as amended) and all other relevant laws, regulations and rules. Italy The offering of the Units has not been cleared by CONSOB (the Italian Securities Exchange Commission) pursuant to Italian securities legislation or the Bank of Italy. Accordingly, no Units may be offered, sold or delivered, directly or indirectly, nor may copies of this Prospectus nor any other documentation relating to the Units be distributed or made available in Italy except (i) to professional investors, as defined under
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Plan of distribution Article 31, second paragraph, of CONSOB Regulation No. 11522 of 1 July 1998, as amended (Regulation No. 11522), in accordance with Article 100 and Article 30, second paragraph, of Legislative Decree No. 58 of 24 February 1998, as amended (the Financial Services Act), provided that such professional investors act in their capacity and not as depositories or nominees for other person; or (ii) in circumstances which are exempted from the rules of solicitation of investments pursuant to Article 100 of the Financial Services Act and Article 33, first paragraph, of CONSOB Regulation No. 11971 of 14 May 1999, as amended (Regulation No. 11971). In any event, the offering of the Units must be effected in compliance with all relevant Italian securities, tax and exchange controls and any other applicable laws and regulations. Accordingly, the Units may not be offered, sold or delivered and copies of this Prospectus or any other documentation relating to the Units may not be distributed or made available in Italy unless such offer of the Units or distribution or availability of copies of this Prospectus or any other documentation relating to the Units in Italy is made: (i) by an investment firm, a bank or a financial intermediary permitted to conduct such activities in Italy in accordance with Legislative Decree No. 385 of 1 September 1993, as amended (the Banking Act) and the implementing instructions of the Bank of Italy, the Financial Services Act, Regulation No. 11522, Regulation No. 11971 and any other applicable laws and regulations; (ii) in compliance with Article 129 of the Banking Act and the implementing instructions of the Bank of Italy, pursuant to which the issue or offer of securities in Italy is subject to prior notification to the Bank of Italy unless an exemption, depending, inter alia, on the aggregate value of the securities issued or offered and the features of the securities, applies; and (iii) in compliance with any other applicable notification, requirement or limitation which may be imposed by CONSOB or the Bank of Italy. In any case, the Units should not be placed, offered, sold, re-sold or delivered on a retail basis, either in the primary or the secondary market, to any persons which are not professional investors and in any case to any individual residing in Italy. Each person in Italy receiving this Prospectus acknowledges that it (i) is a professional investor, as defined under Article 31, second paragraph, of CONSOB Regulation No. 11522 of 1 July 1998, as amended, (ii) is acting in its capacity as a professional investor and not as a depository or nominee for another person, and (iii) has agreed that it will not resell or deliver the Units purchased in this offering in Italy to persons which are not professional investors and in any case it will not resell or deliver the Units purchased in this offering to any individual residing in Italy. Japan The Units have not been and will not be registered under the Securities and Exchange Law of Japan (the Securities and Exchange Law) and each of the Underwriters has agreed that it will not offer or sell any securities, directly or indirectly, in Japan or to, or for the benefit of, any resident of Japan (which term as used herein means any person resident of Japan, including any corporation or other entity organised under the laws of Japan), or to others for re-offering or resale, directly or indirectly, in Japan or to a resident of Japan except pursuant to an exemption which will result on compliance with the Securities and Exchange Law and any other applicable laws, regulations and guidelines promulgated by the relevant Japanese governmental and regulatory authorities and which are then in effect. The Netherlands The offer of the Units is subject to the provisions of the Prospectus Directive referred to above in European Economic Area. The Units can only be offered in the Netherlands without the publication, approval or notification of a prospectus in relation to the Units if an exemption applies. In the case of the offering of the Units, an exemption applies in view of the fact that the Units are solely offered to professional market parties within the meaning of the Exemption Regulation to the Act on the Supervision of the Securities Transactions 1995 (Vrijstellingsregeling Wet toezicht effectenverkeer 1995). The Manager is exempted from the obligation to obtain a licence within the meaning of the Act on the Supervision of the Investment Institutions (Wet toezicht beleggingsinstellingen) as the Units may only be offered, sold, delivered or transferred, directly or indirectly, solely to individuals or legal entitles that trade or invest in investment products (beleggingsproducten) in the conduct of a profession or trade, including banks, brokers and institutional investors, within the meaning of the Exemption Regulation to the Act on the Supervision of the Investment Institutions (Vrijstellingsregeling Wet toezicht beleggingsinstellingen), as amended from time to time.
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Plan of distribution United Arab Emirates The Units have not been and will not, directly or indirectly, be issued, offered, sold, delivered or publicly promoted or advertised in the United Arab Emirates (the UAE) other than in compliance with any laws applicable in the UAE governing the issue, offering, and/or sale, delivery or public promotion or advertisement of securities including without limitation those laws applicable in the Dubai International Financial Centre. This Prospectus is strictly private and confidential and has not been and will not be reviewed by, deposited or registered with any licensing authority, the Dubai International Financial Exchange or governmental agencies in the UAE, including without limitation the Emirates Securities and Commodities Authority or the UAE Central Bank, the Dubai Financial Market, the Abu Dhabi Securities Market, or any other UAE Exchange. This Prospectus may be issued to a limited number of institutional and/or sophisticated investors in the UAE upon their request and confirmation that they understand that LMIR Trust has not been licensed by or registered with the UAE authorities concerned and that this Prospectus is intended only for the original recipient to whom it is addressed, must not therefore be provided to any person other than such original recipient and may not be reproduced or used for any other purpose. Further, the information contained in this Prospectus does not, and is not intended to, constitute a public offer of securities in any part of the United Arab Emirates in accordance with the Commercial Companies Law (UAE Federal Law No. 8 of 1984 (as amended)) or otherwise, and is not intended to be an offer or an invitation to subscribe for or purchase any Units. Furthermore, the information contained in this Prospectus is not intended to lead to the conclusion of any contract of whatsoever nature within the territory of the United Arab Emirates. United Kingdom The Units are interests in a collective investment scheme (as defined in the Financial Services and Markets Act 2000 (the FSMA)) which has not been authorised or reviewed by the Financial Services Authority or any other regulatory authority of the United Kingdom. Accordingly, this Prospectus is not being distributed to, and must not be passed on to, or relied or acted upon by, the general public in the United Kingdom. This Prospectus is for distribution in the United Kingdom only to persons (i) who have professional experience of participating in unregulated collective investment schemes and of markets relating to investments falling within both Article 14(5) of the Financial Services and Markets Act 2000 (Promotion of Collective Investment Schemes) (Exemptions) Order 2002 (the CIS Order) and Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the FP Order), or (ii) who fall within both Article 22(2)(a) to (d) of the CIS Order and Article 49(2)(a) to (d) of the FP Order, or (iii) to whom communications relating to unregulated collective investment schemes may otherwise lawfully be made (such persons together Relevant Eligible Persons). By way of explanation, the following persons fall within Article 49(2)(a) to (d) of the FP Order and Article 22(2)(a) to (d) of the CIS Order: a body corporate which has more than 20 members or which is a subsidiary undertaking of a parent undertaking which has more than 20 members and which has a called up share capital or net assets of not less than 500,000; any other body corporate, unincorporated association or partnership which has a called up capital or net assets of not less than 5 million; the trustee of a high value trust (being a trust where the aggregate value of the cash and investments which form part of the trusts assets (before deducting the amount of its liabilities) is (a) 10 million or more, or (b) has been 10 million or more at any time during the year immediately preceding the date on which this communication was first directed); or any person acting in the capacity of a director, officer or employer of one of the previous three categories of persons and whose responsibilities include him or her engaging in investment activity. Any investment or investment activity to which this Prospectus relates is only available to Relevant Eligible Persons or will be engaged in only with Relevant Eligible Persons and this financial promotion must not be relied or acted upon by persons who are not Relevant Eligible Persons. Expressions of interest resulting from this Prospectus will only be responded to if received from persons falling within those Articles.
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Plan of distribution United States of America The Units have not been and will not be registered under the Securities Act, or any state securities laws, and may not be offered, sold, pledged or transferred within the United States, except in certain transactions exempt from the registration requirements of the Securities Act. The Units are being offered and sold only outside the United States in accordance with Regulation S under the Securities Act. Terms used but not defined in this section shall bear the meanings given to them under Regulation S. In addition, each subscriber of or purchaser of Units or any interest therein, including in the secondary market, who is a U.S. person for US federal income tax purposes will be deemed to have made the following representations: We understand and acknowledge that LMIR Trust may be classified as a passive foreign investment company (PFIC) for the current taxable year and for future taxable years due to the nature of its income and activities and operations. A non-U.S. corporation will be considered a PFIC for any taxable year if either (i) at least 75% of its gross income is passive income, or (ii) at least 50% of the value of its assets is attributable to assets that produce or are held for the production of passive income. In this regard, rental income, which constitutes LMIR Trusts main income, is generally considered passive unless it meets certain criteria to be considered active rents. We understand that a portion of LMIR Trusts rental income would likely not be considered active rents, and thus, LMIR Trust may be considered a PFIC. A separate determination must be made as to the PFIC status each year; We understand that, if LMIR Trust is a PFIC either currently or in any future taxable year during which we hold Units, we will be subject to special tax rules with respect to any excess distribution that we receive and any gain we realize from a sale or other disposition of the Units, unless we make a mark-to-market election or a qualified electing fund election described below. Distributions we receive in a taxable year that are greater than 125% of the average annual distributions we received during the shorter of the three preceding taxable years or our holding period for the Units will be treated as an excess distribution. We are aware that under these special tax rules: 1. 2. 3. The excess distribution or gain will be allocated rateably over our holding period for the Units; The amount allocated to the current taxable year and any taxable year prior to the first taxable year in which LMIR Trust became a PFIC will be treated as ordinary income; The amount allocated to each other year will be subject to the highest tax rate in effect for that year and the interest charge generally applicable to underpayments of tax will be imposed on the resulting tax attributable to each such year; and The tax liability for amounts allocated to years prior to the year of disposition or excess distribution cannot be offset by any net operating losses for such years, and gains (but not losses) realised on the sale of the Units cannot be treated as capital, even if we hold the Units as capital assets;

4.

We understand that if we are a U.S. holder of marketable stock (as defined below) in a PFIC, we may make a mark-to-market election for such stock to elect out of the tax treatment discussed above. If we make a mark-to-market election for the Units, we will include in income each year an amount equal to the excess, if any, of the fair market value of the Units as of the close of our taxable year over our adjusted basis in such Units. We further understand that we are allowed a deduction for the excess, if any, of the adjusted basis of the Units over their fair market value as of the close of the taxable year. However, deductions are allowed only to the extent of any net mark-to-market gains on the Units included in our income for prior taxable years. We are aware that amounts included in our income under a mark-to-market election, as well as gain on the actual sale or other disposition of the Units, are treated as ordinary income. Ordinary loss treatment also applies to the deductible portion of any mark-to-market loss on the Units, as well as to any loss realised on the actual sale or disposition of the Units, to the extent that the amount of such loss does not exceed the net mark-to-market gains previously included for such Units. Accordingly, we understand that our basis in the Units will be adjusted to reflect any such income or loss amounts. We further understand that if we make a valid mark-to-market election with respect to the Units, the tax rules that apply to distributions by corporations which are not PFICs would apply to distributions by LMIR Trust;
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Plan of distribution We understand that the mark-to-market election is available only for marketable stock, which is stock that is traded in other than de minimis quantities on at least 15 days during each calendar quarter on a qualified exchange or other market, as defined in applicable U.S. Treasury regulations. Although not free from doubt, we understand that the SGX-ST should be considered as a qualified exchange or other market for this purpose; We understand that, in general, if a non-U.S. corporation is a PFIC, a holder of shares in that corporation may avoid taxation under the rules described above by making a qualified electing fund election to include its share of the corporations income on a current basis, or a deemed sale election once the corporation no longer qualifies as a PFIC. We understand and acknowledge however that we may make a qualified electing fund election with respect to our Units only if LMIR Trust agrees to furnish us annually with certain tax information, and LMIR Trust does not intend to prepare and provide such information; and We understand that if we hold Units in any year in which LMIR Trust is a PFIC, we will be required to file Internal Revenue Service Form 8621 regarding distributions received on the Units and any gain realised on the disposition of the Units. We acknowledge that we have been advised to consult our tax adviser regarding the application of the PFIC rules to our investment in the Units. In addition, each subscriber or purchaser of Units or any interest therein, including in the secondary market, will be deemed to have represented that no portion of the funds used by it to acquire the Units constitute (a) the assets of any plan (as such term is defined in Section 4975 of the U.S. Internal Revenue Code of 1986, as amended (the IRC)) that is subject to Section 4975 of the IRC or (b) the plan assets of any employee benefit plan that is subject to Title I of the U.S. Employee Retirement Income Security Act of 1974, as amended (ERISA), pursuant to U.S. Department of Labor Regulation Section 2510.3-101(b)(i) as modified by Section 3(42) of ERISA or Section 401(c) of the ERISA.

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Clearance and settlement

INTRODUCTION A letter of eligibility has been obtained from the SGX-ST for the listing and quotation of the Units. For the purpose of trading on the SGX-ST, a board lot for the Units will comprise 1,000 Units. Upon listing and quotation on the SGX-ST, the Units will be traded under the electronic book-entry clearance and settlement system of CDP . All dealings in and transactions of the Units through the SGX-ST will be effected in accordance with the terms and conditions for the operation of Securities Accounts, as amended from time to time. CDP , a wholly-owned subsidiary of Singapore Exchange Limited, is incorporated under the laws of Singapore and acts as a depository and clearing organisation. CDP holds securities for its account-holders and facilitates the clearance and settlement of securities transactions between account-holders through electronic book-entry changes in the Securities Accounts maintained by such account-holders with CDP . It is expected that the Units will be credited into the Securities Accounts of applicants for the Units within four Market Days after the closing date for applications for the Units. CLEARANCE AND SETTLEMENT UNDER THE DEPOSITORY SYSTEM The Units will be registered in the name of CDP or its nominee and held by CDP for and on behalf of persons who maintain, either directly or through depository agents, Securities Accounts with CDP . Persons named as direct Securities Account holders and depository agents in the depository register maintained by CDP will be treated as Unitholders in respect of the number of Units credited to their respective Securities Accounts. Transactions in the Units under the book-entry settlement system will be reflected by the sellers Securities Account being debited with the number of Units sold and the buyers Securities Account being credited with the number of Units acquired and no transfer stamp duty is currently payable for the transfer of Units that are settled on a book-entry basis. Units credited to a Securities Account may be traded on the SGX-ST on the basis of a price between a willing buyer and a willing seller. Units credited into a Securities Account may be transferred to any other Securities Account with CDP , subject to the terms and conditions for the operation of Securities Accounts and a S$10.00 transfer fee payable to CDP . All persons trading in the Units through the SGX-ST should ensure that the relevant Units have been credited into their Securities Account, prior to trading in such Units, since no assurance can be given that the Units can be credited into the Securities Account in time for settlement following a dealing. If the Units have not been credited into the Securities Account by the due date for the settlement of the trade, the buy-in procedures of the SGX-ST will be implemented. Clearing fees A clearing fee for the trading of Units on the SGX-ST is payable at the rate of 0.04% of the transaction value, subject to a maximum of S$600.00 per transaction. The clearing fee, deposit fee and unit withdrawal fee may be subject to GST (currently 7.0%). Dealings in the Units will be carried out in Singapore dollars and will be effected for settlement in CDP on a scripless basis. Settlement of trades on a normal ready basis on the SGX-ST generally takes place on the third Market Day following the transaction date. CDP holds securities on behalf of investors in Securities Accounts. An investor may open a direct account with CDP or a sub-account with any CDP depository agent. A CDP depository agent may be a member company of the SGX-ST, bank, merchant bank or trust company.
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Experts
RSM Chio Lim, the Independent Reporting Accountants, were responsible for preparing the Independent Accountants Report on the Profit Forecast and Profit Projection and the Independent Accountants Report on the Unaudited Pro Forma Consolidated Balance Sheet as at Listing Date found in Appendix A and Appendix B of this Prospectus, respectively. Ernst & Young, the Independent Singapore Tax Adviser, was responsible for preparing the Independent Singapore Taxation Report found in Appendix C of this Prospectus. PB & Co, the Independent Indonesian Tax Adviser, was responsible for preparing the Independent Indonesian Taxation Report found in Appendix D of this Prospectus. Knight Frank / PT. Willson Properti Advisindo and Colliers International / PT Penilai, the Independent Valuers, were responsible for preparing the Independent Property Valuation Summary Reports found in Appendix E of this Prospectus, PT Jones Lang LaSalle, the Independent Indonesian Retail Property Consultant, was responsible for preparing the section of this Prospectus entitled Independent Report on the Indonesian Retail Property Market found in Appendix F of this Prospectus. The Independent Reporting Accountants, the Independent Singapore Tax Adviser, the Independent Indonesian Tax Adviser, the Independent Valuers and the Independent Retail Consultant have each given and have not withdrawn their written consents to the issue of this Prospectus with the inclusion herein of their names and their respective write-ups and reports and all references thereto in the form and context in which they respectively appear in this Prospectus, and to act in such capacity in relation to this Prospectus. None of Allen & Gledhill LLP , Stamford Law Corporation, Latham & Watkins LLP , Makes & Partners, Hadiputranto Hadinoto & Partners, Ery Yunasri & Partners and Shook Lin & Bok LLP makes, or purports to make, any statement in this Prospectus and none of them is aware of any statement in this Prospectus which purports to be based on a statement made by it and it makes no representation, express or implied, regarding, and takes no responsibility for, any statement in or omission from this Prospectus.

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General information
(1) The profit forecast and profit projection contained in Profit Forecast and Profit Projection have been stated by the Directors after due and careful enquiry. (2) There are no legal or arbitration proceedings pending or, so far as the Directors are aware, threatened against the Manager the outcome of which, in the opinion of the Directors, may have or have had during the 12 months prior to the date of this Prospectus, a material adverse effect on the financial position of the Manager. (3) There are no legal or arbitration proceedings pending or, so far as the Directors are aware, threatened against LMIR Trust the outcome of which, in the opinion of the Directors, may have or have had during the 12 months prior to the date of this Prospectus, a material adverse effect on the financial position (on a pro forma consolidated basis) of LMIR Trust. (4) The name, age and address of each of the Directors are set out in The Manager and Corporate GovernanceThe Manager of LMIR TrustDirectors of the Manager. A list of the present and past directorships of each Director and Executive Officer of the Manager over the last five years preceding the Latest Practicable Date is set out in Appendix HList of Present and Past Principal Directorships of Directors and Executive Officers. (5) There is no family relationship among the Directors and executive officers of the Manager. (6) None of the Directors or executive officers of the Manager is or was involved in any of the following events: at any time during the last 10 years, an application or a petition under any bankruptcy laws of any jurisdiction filed against him or against a partnership of which he was a partner at the time when he was a partner or at any time within two years from the date he ceased to be a partner; at any time during the last 10 years, an application or a petition under any law of any jurisdiction filed against an entity (not being a partnership) of which he was a director or an equivalent person or a key executive, at the time when he was a director or an equivalent person or a key executive of that entity or at any time within two years from the date he ceased to be a director or an equivalent person or a key executive of that entity, for the winding up or dissolution of that entity or, where that entity is the trustee of a business trust, that business trust, on the ground of insolvency; any unsatisfied judgment against him; a conviction of any offence, in Singapore or elsewhere, involving fraud or dishonesty which is punishable with imprisonment, or has been the subject of any criminal proceedings (including any pending criminal proceedings of which he is aware) for such purpose; a conviction of any offence, in Singapore or elsewhere, involving a breach of any law or regulatory requirement that relates to the securities or futures industry in Singapore or elsewhere, or has been the subject of any criminal proceedings (including any pending criminal proceedings of which he is aware) for such breach; at any time during the last 10 years, judgment been entered against him in any civil proceedings in Singapore or elsewhere involving a breach of any law or regulatory requirement that relates to the securities or futures industry in Singapore or elsewhere, or a finding of fraud, misrepresentation or dishonesty on his part, or any civil proceedings (including any pending civil proceedings of which he is aware) involving an allegation of fraud, misrepresentation or dishonesty on his part; a conviction in Singapore or elsewhere of any offence in connection with the formation or management of any entity or business trust; disqualification from acting as a director or an equivalent person of any entity (including the trustee of a business trust), or from taking part directly or indirectly in the management of any entity or business trust; any order, judgment or ruling of any court, tribunal or governmental body permanently or temporarily enjoining him from engaging in any type of business practice or activity;
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General information to his knowledge, been concerned with the management or conduct, in Singapore or elsewhere, of the affairs of: (i) (ii) (iii) (iv) any corporation which has been investigated for a breach of any law or regulatory requirement governing corporations in Singapore or elsewhere; any entity (not being a corporation) which has been investigated for a breach of any law or regulatory requirement governing such entities in Singapore or elsewhere; any business trust which has been investigated for a breach of any law or regulatory requirement governing business trusts in Singapore or elsewhere; any entity or business trust which has been investigated for a breach of any law or regulatory requirement that relates to the securities or futures industry in Singapore or elsewhere in connection with any matter occurring or arising during the period when he was so concerned with the entity or business trust; or

has been reprimanded or issued any warning, by the MAS or any other regulatory authority, exchange, professional body or government agency, whether in Singapore or elsewhere. (7) The financial year-end of LMIR Trust is 31 December. The annual audited financial statements of LMIR Trust will be prepared and sent to Unitholders within three months of the financial year-end. (8) A full valuation of each of the real estate assets held by LMIR Trust will be carried out at least once a year in accordance with the Property Funds Guidelines. The Manager or the Trustee may at any other time arrange for the valuation of any of the real properties held by LMIR Trust if it is of the opinion that it is in the best interest of Unitholders to do so. (9) While LMIR Trust is listed on the SGX-ST, investors may check the SGX-ST website http://www.sgx.com for the prices at which Units are being traded on the SGX-ST. Investors may also check one or more major Singapore newspapers such as The Straits Times, The Business Times and Lianhe Zaobao, for the price range within which Units were traded on the SGX-ST on the preceding day. (10) The Manager does not intend to receive soft dollars (as defined in the CIS Code) in respect of LMIR Trust. Save as disclosed in this Prospectus, unless otherwise permitted under the Listing Manual, neither the Manager nor any of its Associates will be entitled to receive any part of any brokerage charged to LMIR Trust, or any part of any fees, allowances or benefits received on purchases charged to LMIR Trust. (11) The SGX-ST has granted waivers to LMIR Trust from compliance with the following: (a) Rule 404(3) of the Listing Manual, which would otherwise require an investment fund which is denominated in Singapore Dollars (other than a venture capital fund or a hedge fund) to: (i) limit its investment in companies which are related to the investment funds substantial shareholders, investment managers or management companies to a maximum of 10.0% of gross assets; (ii) abide by the same investment and borrowing restrictions that govern investments companies prescribed by the Companies Act; and (iii) restrict investments in unlisted securities to 30.0% of gross assets; Rules 404(5) and 407(4) of the Listing Manual, which would otherwise require the Manager to be reputable and have a track record in managing investments, as the Manager has only been recently incorporated; Rule 409(3) of the Listing Manual, which would otherwise require the submission with the application for the listing of LMIR Trust on the SGX-ST the annual accounts of LMIR Trust for each of the last five financial years; Rule 705(2), which would otherwise require the Manager to announce LMIR Trusts financial results for the period from the Listing Date to 31 December 2007; Rule 707(2), which would otherwise require LMIR Trust to issue an annual report for the financial period from 8 August 2007 to 31 December 2007;

(b)

(c)

(d) (e)

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General information (f) (g) (h) Rule 748(1) of the Listing Manual, which would otherwise require LMIR Trust to announce via SGXNET its net tangible assets per Unit at the end of each week; and Rule 748(3), which would otherwise require LMIR Trust to disclose certain information in its annual report subject to compliance with the Property Funds Guidelines; and the requirement of holding annual general meetings of LMIR Trust.

(12) The dates of, parties to, and general nature of every material contract which the trustee of LMIR Trust has entered into within the two years preceding the date of this Prospectus (not being contracts entered into in the ordinary course of the business of LMIR Trust) are as follows: (a) (b) (c) the Trust Deed; the Singapore SPC Share Purchase Agreements; and the Right of First Refusal Agreement.

(See Certain Agreements relating to LMIR Trust and the PropertiesDescription of the Right of First Refusal Agreement.) (13) Copies of the following documents are available for inspection at the registered office of the Manager at 78 Shenton Way, #05-01 Lippo Centre, Singapore 079120, for a period of six months from the date of this Prospectus: (a) (b) (c) (d) (e) (f) (g) (h) (i) (j) (k) (l) (m) (n) (o) (p) (q) (r) (s) the material contracts referred to in paragraph 12 above, save for the Trust Deed (which will be available for inspection for so long as LMIR Trust is in existence); the Underwriting Agreement; the Unit Lending Agreement; the Cornerstone Subscription Agreements; the Property Purchase Agreements; the Retail Space Indonesian SPC Share Purchase Agreements; the Retail Mall Indonesian SPC Share Purchase Agreements; the Master Lease Agreements; the Operating Costs Agreements; the Rental Guarantee Deeds; the Right of First Refusal Agreement; the Existing Property Management Agreements; the Master Property Management Agreement; the Independent Accountants Report on the Profit Forecast and Profit Projection as set out in Appendix A of this Prospectus; the Independent Accountants Report on the Unaudited Pro Forma Consolidated Balance Sheet as at the Listing Date as set out in Appendix B of this Prospectus; the Independent Singapore Taxation Report as set out in Appendix C of this Prospectus; the Independent Indonesian Taxation Report as set out in Appendix D of this Prospectus; the Independent Property Valuation Summary Reports as set out in Appendix E of this Prospectus as well as the full valuation reports referred to therein for each of the Properties; the Independent Report on the Retail Property Industry in Indonesia as set out in Appendix F of this Prospectus;
269

General information (t) the written consents of the Independent Reporting Accountants, the Independent Singapore Tax Adviser, the Independent Indonesian Tax Adviser, the Independent Valuers and the Independent Indonesian Retail Property Consultant (see Experts); the undertaking of the Manager to the MAS covenanting, among other things, not to deal in the Units during certain stipulated periods (see The Manager and Corporate Governance Corporate Governance of the ManagerDealings in Units); the undertaking of the Manager to the SGX-ST that it will conduct a valuation of LMIR Trusts real estate and real estate-related assets annually and announce the NAV per Unit on a quarterly basis (see The Manager and Corporate GovernanceAnnual Reports); and the Depository Services Agreement.

(u)

(v)

(w)

(14) UBS, named as Financial Adviser to the Offering and Joint Lead Manager, Issue Managers and Underwriter, has given and has not withdrawn its written consent to the issue of this Prospectus with the inclusion herein of, and all references to, its name and all references thereto in the form and context in which they appear in this Prospectus, and to act in such capacity in relation to this Prospectus. (15) BNP and OCBC Bank, named as Joint Lead Managers, Issue Managers and Underwriters, have each given and have not withdrawn their written consent to the issue of this Prospectus with the inclusion herein of, and all references to, their names and all references thereto in the form and context in which they appear in this Prospectus, and to act in such capacity in relation to this Prospectus.

270

Glossary
% Aggregate Leverage Per centum or percentage Total borrowings and deferred payments (including deferred payments for assets whether to be settled in cash or in units of the relevant property fund) Law No. 5 Year 1960, which governs Indonesian real property rights The Analysis of Environmental Impacts based on the framework of reference, the environmental impact assessment report The printed application forms to be used for the purpose of the Offering and which form part of this Prospectus The list of applicants subscribing for Units which are the subject of the Public Offer In relation to a Property, the value for that Property (i) as at 30 June 2007 as appraised by Knight Frank, and (ii) as at 30 June 2007 as appraised by Colliers Has the meaning ascribed to it in the Listing Manual Automated teller machines, and each, an ATM Ahli United Bank Refers to, in general, (i) real estate, whether freehold or leasehold, in or outside Singapore or Indonesia, held singly or jointly, and/or by way of direct ownership or by a shareholding in a SPV; (ii) any improvement or extension of or addition to or reconstruction or renovation or other development of any real estate or any building thereon; (iii) real estate related assets, wherever the issuers, assets or securities are incorporated, located, issued or traded; (iv) listed or unlisted debt securities and listed shares or stock and (if permitted by the MAS) unlisted shares or stock of or issued by local or foreign non-property companies or corporations; (v) government securities (issued on behalf of the Singapore Government or governments of other countries) and securities issued by a supra-national agency or a Singapore statutory board; (vi) cash and cash equivalent items; (vii) financial derivatives only for the purposes of (a) hedging existing positions in the portfolio of LMIR Trust where there is a strong correlation to the underlying investments or (b) efficient portfolio management, provide that such derivatives are not used to gear the overall portfolio of LMIR Trust or intended to be borrowings of LMIR Trust; and (viii) other investment not covered by sub-paragraph (i) to (vii) of this definition but specified as a permissible investment in the Property Funds Guidelines and selected by the Manager for investment by LMIR Trust and approved by the Trustee in writing (see the Trust Deed for details) 0.50% of the value of Authorised Investments which are not real estate (whether held directly by LMIR Trust or indirectly via one or more SPVs) subject to certain conditions The cooperation agreement on the renovation, development and management of Hotel Pakunegara, Bandung (Perjanjian
271

Agrarian Law AMDAL Report Application Forms Application List Appraised Value

Associate ATMs AUB Authorised Investment

Authorised Investment Management Fee Bandung Indah Plaza Cooperation Agreement

Glossary Kerjasama Pemugaran Pembangunan dan Pengelolaan Hotel Pakunegara) between Perusahaan Daerah Jasa Dan Kepariwisataan Propinsi Jawa Barat, and formerly known as Perusahaan Daerah Kerta Wisata Jawa Barat) and PT Bhuwanatala Indah Permai Tbk (formerly known as PT Bandung Indah Plaza Permai) Base Amount Base Fee Base Rent Basic Agrarian Law BNP Board BOT BOT Agreement or Cooperation Agreement BOT Grantee The minimum purchase consideration payable to the respective Vendor in respect of each Property 0.25% per annum of the value of the Deposited Property payable to the Manager under the Trust Deed Rental income derived from the Retail Spaces and Retail Malls pursuant to tenant leases The Basic Agrarian Law (Law No. 5 of 1960) of Indonesia BNP Paribas Capital (Singapore) Ltd. Board of directors of the Manager Build, Operate and Transfer An agreement entered into by the BOT Grantor and the BOT Grantee in relation to the construction of a structure of some of the Retail Malls, i.e. a building and fixtures The party which owns the land property and grants a right by the BOT Grantor to build and operate a building on the BOT Grantors land for a particular period of time, at the BOT Grantees cost, pursuant to a BOT Scheme The land owner or the party that is appointed by the land owner, who grants a BOT Grantee a right to build and operate a building on the BOT Land for a particular period of time, at the BOT Grantees cost, pursuant to a BOT Scheme; and at the end of the BOT period for the BOT Grantee to transfer the building to the BOT Grantor The land owned by the land owner, that is granted to the BOT Grantee based on a BOT Agreement Build, Operate and Transfer schemes where the BOT Grantor agrees to grant the BOT Grantee a right to build and operate a building on the BOT Grantors land for a particular period of time, at the BOT Grantees cost Badan Pertanahan Negara, or National Land Board of Indonesia Bumi Serpong Damai City Any day (other than a Saturday, Sunday or gazetted public holiday) on which commercial banks are open for business in Singapore and the SGX-ST is open for trading Central business district The Central Depository (Pte) Limited Consultative Group on Indonesia The Code on Collective Investment Schemes (including the Property Funds Guidelines) of Singapore issued by the MAS CIMB-Mapletree Real Estate Fund 1

BOT Grantor

BOT Land BOT Schemes

BPN BSD City Business Day

CBD CDP CGI CIS Code CMREF 1

272

Glossary Colliers Committed Leases Companies Act Cornerstone Investors Cornerstone Subscription Agreements Colliers International / PT Penilai, as Independent Valuer to the Trustee All current leases in respect of the Properties as at 30 June 2007 and each, a Committed Lease Companies Act, Chapter 50 of Singapore Lippo Strategic and Mapletree LM Each of the subscription agreements (a) dated 18 October 2007 entered into between Lippo Strategic and the Manager, pursuant to which Lippo Strategic subscribed for 287,695,000 Cornerstone Units, and (b) dated 18 October 2007 entered into between Mapletree LM and the Manager, pursuant to which Mapletree LM subscribed for 127,250,000 Cornerstone Units The aggregate of 414,945,000 Units subscribed by all the Cornerstone Investors pursuant to the Cornerstone Subscription Agreements Central Provident Fund of Singapore CP Inlandsimmobilien Holding Gmbh The 14 Deeds of Indemnity dated 18 October 2007 entered into by the Trustee and Lippo Capital Limited, pursuant to which Lippo Capital Limited will indemnify the Trustee against liabilities or damage suffered by the Trustee arising from any of the 14 Singapore SPC Share Purchase Agreements, subject to certain conditions Four strata units in Depok Town Square located at Jalan Margonda Raya No. 1, Pondok Cina Beji, Depok, Greater Jakarta (See Business and PropertiesDepok Town Square UnitsRelevant information relating to the Depok Town Square Units) All the assets of LMIR Trust, including the Properties and all the Authorised Investments of LMIR Trust for the time being held or deemed to be held upon the trusts under the Trust Deed The depository services agreement dated 10 August 2007 entered into between CDP , the Manager and the Trustee relating to the deposit of the Units in CDP Director of the Manager Income of LMIR Trust distributable to Unitholders, as defined in Profit Forecast and Profit ProjectionAssumptions(IX) Distributable Income The application for the Units offered in the Offering by way of ATMs of the Participating Banks The U.S. Employee Retirement Income Security Act of 1974, as amended The property management agreements entered into between each of the Retail Mall Indonesian SPCs and the Property Manager in respect of the Retail Malls and Existing Property Management Agreement means any one of them
273

Cornerstone Units

CPF CPIHG Deeds of Indemnity

Depok Town Square Units

Deposited Property

Depository Services Agreement

Director Distributable Income

Electronic Applications ERISA Existing Property Management Agreements

Glossary Extraordinary Resolution A resolution proposed and passed as such by a majority consisting of 75.0% or more of the total number of votes cast for and against such resolution at a meeting of Unitholders duly convened and held in accordance with the provisions of the Trust Deed Food and beverage UBS AG, acting through its business group, UBS Investment Bank, as sole financial adviser to the Offering The period commencing from the Listing Date until the date falling six months after the Listing Date The period from 1 July 2007 to 31 December 2007 Singapore Financial Reporting Standards Financial year ended or, as the case may be, ending 31 December Gross domestic product Gross floor area Four strata units in Grand Palladium Medan located at Jalan Kapt. Maulana Lubis, Medan, North Sumatra (See Business and PropertiesGrand Palladium Medan UnitsRelevant information relating to the Grand Palladium Medan Units) Gross regional domestic product Comprises Jakarta, Bogor, Depok, Tangerang and Bekasi Base rent and services charges The aggregate of Gross Rent, carpark income and other income earned primarily from the Properties Goods and services tax of Singapore Hectares Hak Guna Bangunan (Right to Build) Hak Pakai, the right to use and/or collect the products of land directly administered by the State, or of land owned by other persons (based on Hak Milik). Hak Pengelolaan, the right to (i) plan the purpose and the use of the land, (ii) use the land for the need of the business of the holder and (iii) surrender plots of land to third parties in accordance with the terms and conditions set up by the holder of the HPL title. Izin Mendirikan Bangunan International Monetary Fund The Income Tax Act, Chapter 134 of Singapore PT Jones Lang LaSalle PB & Co Knight Frank and Colliers

F&B Financial Adviser First Lock-Up Period Forecast Period 2007 FRS FY GDP GFA Grand Palladium Medan Units

GRDP Greater Jakarta Gross Rent Gross Revenue GST ha HGB HP

HPL

IMB IMF Income Tax Act Independent Indonesian Retail Property Consultant Independent Indonesian Tax Adviser Independent Valuers
274

Glossary Indonesian SPCs Interested Person Interested Person Transaction Investible Savings IPB IRAS IRC Issue Price Istana Plaza BOT Agreement Istana Plaza Cooperation Agreement The Retail Mall Indonesian SPCs and the Retail Space Indonesian SPCs Has the meaning ascribed to it in the Listing Manual and the Property Funds Guidelines Has the meaning ascribed to it in the Listing Manual and the Property Funds Guidelines The balance in a CPF Ordinary Account plus the net amounts (if any) withdrawn for education and investment Institut Pertanian Bogor Inland Revenue Authority of Singapore U.S. Internal Revenue Code of 1986, as amended Issue price of each Unit The Istana Plaza Cooperation Agreement and its amendments The cooperation agreement, dated 9 May 1997 between, Gereja Kristen Pasundan, Ginawan Chondro, Edi Sukamto Josana, Chandra Tambayong, Wirawan Chondro, Heryanto Gunawan, and Subagya Putra Prawira (as investors), and TK Gunawan Prihatna, Stepanus Tedjasentosa, Tatang Budiarto, and Abrijanto Effendi (as consultants) The Decision of the Minister of Trade and Industry of the Republic of Indonesia No. 107/MPP/Kep/2/1998, dated 27 February 1998 on the Provisions and Procedures for the Granting of Modern Market Business Licences Four strata units in Java Supermall located at Jalan MT Haryono No. 992-994, Jomblang, Semarang, Central Java (See Business and PropertiesJava Supermall UnitsRelevant information relating to the Java Supermall Units) Jakarta Stock Exchange Kiosks Sale and Purchase Binding Agreements are evidence of the parties intention to effect the sale and purchase of Strata Units, but do not have the effect of transferring ownership Kilometre Knight Frank / PT. Willson Properti Advisindo, as independent valuer to the Manager Law No. 13/2003, enacted by the Indonesian government 15 October 2007, being the latest practicable date prior to the lodgement of this Prospectus with the MAS Lippo Strategic Holdings Inc, a limited liability company incorporated in the British Virgin Islands on 2 March 2007, and one of the Cornerstone Investors The date of admission of LMIR Trust to the Official List of the SGX-ST Listing Manual of the SGX-ST PT. Lippo Land Development Tbk Lippo-Mapletree Indonesia Retail Trust, a REIT established in Singapore and constituted by the Trust Deed
275

IUPM

Java Supermall Units

JSX Kiosks Sale and Purchase Binding Agreement km Knight Frank Labour Law Latest Practicable Date Lippo Strategic

Listing Date Listing Manual LLD LMIR Trust

Glossary LQ 45 Index Malang Town Square Units A capitalisation-weighted index of the 45 most heavily traded stocks on the JSX Three strata units in Malang Town Square located at Jalan Veteran No. 2, Malang, East Java (See Business and PropertiesMalang Town Square UnitsRelevant information relating to the Malang Town Square Units) Four strata units in Mall WTC Matahari located at Jalan Raya Serpong, Pondok Jagung, Serpong, Tangerang, Banten, Greater Jakarta (See Business and PropertiesMall WTC Matahari UnitsRelevant information relating to the Mall WTC Matahari Units) Lippo-Mapletree Indonesia Retail Trust Management Ltd., as manager of LMIR Trust Mapletree Capital Management Pte. Ltd. MIPL and its subsidiaries, including Mapletree Capital Mapletree LM Pte. Ltd. Mapletree Logistics Trust A day on which the SGX-ST is open for trading in securities The Monetary Authority of Singapore The seven lease agreements dated 18 October 2007 entered between the Master Lessee and the Retail Space Indonesian SPCs in relation to the Retail Spaces, and Master Lease Agreement means any one of them The property management agreement entered into between the Trustee, the Manager and the Property Manager on 18 October 2007 PT. Matahari Putra Prima Tbk, an Indonesian company listed on the JSX and SSX, in which the Lippo Group has a controlling interest through PT Multipolar Corporation Tbk. Three strata units in Metropolis Town Square located at Jalan Hartono Raya, Modernland Cikokol, Tangerang, Banten, Greater Jakarta (See Business and PropertiesMetropolis Town Square UnitsRelevant information relating to the Metropolis Town Square Units) Mapletree Industrial Fund Mapletree Industrial Fund Management Pte. Ltd. Mapletree Investments Pte Ltd Moodys Investors Services, Inc. Mapletree Real Estate Mezzanine Fund 1 Malaysian Ringgit, the lawful currency of Malaysia Net asset value The Indonesian investment law which amends Law No. 1 of 1967 (as amended) regarding Foreign Capital Investment Law and Law No. 6 of 1968 (as amended) regarding Domestic Capital Investment Law Net lettable area

Mall WTC Matahari Units

Manager Mapletree Capital Mapletree Group Mapletree LM MapletreeLog Market Day MAS Master Lease Agreements

Master Property Management Agreement Matahari or Master Lessee

Metropolis Town Square Units

MIF MIFM MIPL Moodys MREM 1 MYR NAV New Investment Law

NLA
276

Glossary NPI OCBC Bank Offering Net property income consisting of property revenue less property operating expenses Oversea-Chinese Banking Corporation Limited The offering of 645,469,000 Units by the Manager for subscription at the Offering Price under the Placement and the Public Offer, subject to the Over-allotment Option The subscription price of S$0.80 for each Unit under the Offering PT Multi Nusantara Karya, PT Selaras Maju, PT Sarana Karya Megah, PT Antara Nusa Permai, PT Primatama Kreasi Bersama and PT Kharisma Abadi Selaras, and each an Operating Company The operating costs agreement entered into between the relevant Retail Mall Indonesian SPC and Operating Company A resolution proposed and passed as such by a majority being 50.0% of the total number of votes cast for and against such resolution at a meeting of Unitholders duly convened and held in accordance with the provisions of the Trust Deed An option granted by the Unit Lender to the Underwriters to purchase from the Unit Lender up to an aggregate of 96,820,000 Units at the Offering Price, solely to cover the over-allotment of Units (if any) OCBC Bank, DBS Bank Ltd (including POSB) (DBS Bank) and United Overseas Bank (UOB Bank) including its subsidiary, Far Eastern Bank Limited (the UOB Group) 4.0% per annum of the NPI of LMIR Trust in the relevant financial year (calculated before accounting for this additional fee in that financial year) 625,469,000 Units offered by way of an international placement to investors, including institutional and other investors in Singapore, pursuant to the Offering Two HGB titles in Plaza Madiun located at Jalan Pahlawan (See Business and PropertiesPlaza MadiunRelevant information relating to Plaza Madiun) Penanaman Modal Asing, or foreign capital investment companies established and organised under and by virtue of the laws of the Republic of Indonesia and located in Indonesia Pejabat Pembuat Akta Tanah, or Land Deed Official who is normally a local notary in Indonesia The Peoples Republic of China The period from 1 January 2008 to 31 December 2008 The period from 1 January 2009 to 31 December 2009 The properties comprising LMIR Trusts initial asset portfolio as at the Listing Date, namely, the Retail Malls and Retail Spaces and Property means any one of them The guidelines to Real Estate Investment Trusts issued by the MAS as Appendix 2 of the CIS Code
277

Offering Price Operating Companies

Operating Costs Agreement Ordinary Resolution

Over-allotment Option

Participating Banks

Performance Fee

Placement

Plaza Madiun

PMA

PPAT PRC Projection Year 2008 Projection Year 2009 Properties

Property Funds Guidelines

Glossary Property Manager PT. Consulting & Management Services Division, as property manager of the Retail Malls and any property located in Indonesia acquired by LMIR Trust after the Listing Date. The sale and purchase agreements, each entered into by the relevant Indonesian SPC, to acquire the relevant Property PT Indah Pesona Bogor The offering of 20,000,000 Units to the public in Singapore Any stock exchange of repute in any part of the world Real estate investment trust Regulation S under the Securities Act Refers to an interested person and/or, as the case may be, an interested party Refers to an Interested Person Transaction and/or, as the case may be, an Interested Party Transaction A retail property located in Indonesia which is subject to the ROFR, as described in Certain Agreements Relating to LMIR Trust and the PropertiesDescription of the Right of First Refusal Agreement Consists of rent paid by tenants under their lease agreements for space in the Retail Spaces The seven rental guarantee deeds entered into by Lippo Strategic with the relevant Retail Mall Singapore SPC pursuant to which Lippo Strategic will (i) provide a rental guarantee over the relevant Retail Mall and (ii) undertake to pay to the relevant Retail Mall Singapore SPC any shortfall in the maintenance and operation costs which the relevant Operating Company has undertaken to bear under the respective Operating Costs Agreement The seven share purchase agreements, each entered into between two relevant Singapore SPCs and the vendor of the relevant Retail Mall Indonesian SPC, pursuant which the two relevant Singapore SPCs acquire all the ordinary shares in that Retail Mall Indonesian SPC The Indonesian SPCs which collectively own the Retail Malls as at the Listing Date and each a Retail Mall Indonesian SPC The Tier 1 Retail Mall Singapore SPCs and the Tier 2 Retail Mall Singapore SPCs Gajah Mada Plaza, Cibubur Junction, The Plaza Semanggi, Mal Lippo Cikarang, Ekalokasari Plaza, Bandung Indah Plaza and Istana Plaza

Property Purchase Agreements PT IPB Public Offer Recognised Stock Exchange REIT Regulation S Related Party Related Party Transactions Relevant Asset

Rent Rental Guarantee Deeds

Retail Mall Indonesian SPC Share Purchase Agreements

Retail Mall Indonesian SPCs Retail Mall Singapore SPCs Retail Malls

Retail Space Indonesian SPC Share The seven share purchase agreements, each entered into Purchase Agreements between two relevant Singapore SPCs and the vendor of the relevant Retail Space Indonesian SPC, pursuant which the two relevant Singapore SPCs acquire all the ordinary shares in that Retail Space Indonesian SPC Retail Space Indonesian SPCs The Indonesian SPCs which collectively own the Retail Spaces as at the Listing Date, and each a Retail Space Indonesian SPC

278

Glossary Retail Space Singapore SPCs Java Properties Pte. Ltd., Serpong Properties Pte. Ltd., Metropolis Properties Pte. Ltd., Matos Properties Pte. Ltd., Detos Properties Pte. Ltd., Palladium Properties Pte. Ltd. and Madiun Properties Pte. Ltd., and each a Retail Space Singapore SPC The Mall WTC Matahari Units; the Metropolis Town Square Units; the Depok Town Square Units; the Java Supermall Units; the Malang Town Square Units; Plaza Madiun; and the Grand Palladium Medan Units An environmental management plan A right that an offer be made to LMIR Trust over a sale or transfer of a Relevant Asset, as described in Certain Agreements Relating to LMIR Trust and the PropertiesDescription of the Right of First Refusal Agreement Binjai Supermall, Pejaten Mall, Kuta Beach Mall, Kemang City Mall and Puri Paragon City The lawful currency of the Republic of Indonesia An environmental monitoring plan Singapore dollars and cents, the lawful currency of the Republic of Singapore Severe Acute Respiratory Syndrome The period commencing from the day immediately following the First Lock-up Period until the date falling 12 months after the Listing Date Securities account or sub-account maintained by a Depositor (as defined in Section 130A of the Companies Act) with CDP U.S. Securities Act of 1933, as amended The date of service of the put option notice The date and time on which the Units are issued as settlement under the Offering Securities and Futures Act, Chapter 289 of Singapore Securities and Futures Ordinance (Cap. 571 of the Laws of Hong Kong) Singapore Exchange Securities Trading Limited The agreements dated 18 October 2007 entered into between each of the Vendors and the Trustee, pursuant to which the Trustee will acquire all of the ordinary shares and redeemable preference shares in each of the Target Singapore SPCs at completion The Retail Mall Singapore SPCs and the Retail Space Singapore SPCs Special Purpose Companies, and each, a SPC Monthly rental rate per sq m chargeable to specialty store tenants PT. Lippo Karawaci Tbk The Sponsor or any of its subsidiaries
279

Retail Spaces

RKL ROFR or Right of First Refusal

ROFR Properties Rp. or Indonesian Rupiah RPL S$ or Singapore dollars and cents SARS Second Lock-Up Period

Securities Account Securities Act Service Date Settlement Date SFA or Securities and Futures Act SFO SGX-ST Singapore SPC Share Purchase Agreements

Singapore SPCs SPCs Specialty Base Rent Sponsor Sponsor Entity

Glossary SPV sq ft sq m SSX Stabilising Manager Standard & Poors Substantial Unitholder Take-over Code Target Singapore SPCs Tax-Exempt Income Tier 1 Retail Mall Singapore SPCs Special Purpose Vehicle Square feet Square metres Surabaya Stock Exchange UBS Standard & Poors Ratings Group, a division of the McGraw-Hill Companies, Inc. Any Unitholder with an interest in one or more Units constituting not less than 5.0% of all Units in issue The Singapore Code on Take-overs and Mergers issued by the MAS The Tier 1 Retail Mall Singapore SPCs and the Retail Space Singapore SPCs The one-tier (tax-exempt) dividends received from the Target Singapore SPCs Belilios International Pte. Ltd., Dominion Capital Pte. Ltd., Greenlot Investments Pte. Ltd., Tangent Investments Pte. Ltd., Magnus Investments Pte. Ltd., Thornton Investments Pte. Ltd. and Pierbridge Investments Pte. Ltd. Prism Investments Pte. Ltd., Silver Dory Holdings Pte. Ltd., Vernon Investments Pte. Ltd., Maxia Investments Pte. Ltd., Fenton Investments Pte. Ltd., Langston Investments Pte. Ltd. and Bowland Investments Pte. Ltd. Tristar Capital Ltd. The trust deed dated 8 August 2007 (as amended by a first supplemental deed dated 18 October 2007) entered into between the Trustee and the Manager constituting LMIR Trust. HSBC Institutional Trust Services (Singapore) Limited, as trustee of LMIR Trust United States of America UBS AG, acting through its business group, UBS Investment Bank Unaudited Pro Forma Consolidated Balance Sheet of LMIR Trust as at the Listing Date BNP , OCBC Bank and UBS The underwriting agreement dated 9 November 2007 entered into between the Sponsor, the Manager, the Unit Lender and the Underwriters The underwriting, selling and management commission payable to the Underwriters for their services in connection with the Offering An undivided interest in LMIR Trust as provided for in the Trust Deed Lippo Strategic

Tier 2 Retail Mall Singapore SPCs

Tristar Trust Deed

Trustee U.S. UBS Unaudited Pro Forma Consolidated Balance Sheet Underwriters Underwriting Agreement

Underwriting, Selling and Management Commission Unit Unit Lender

280

Glossary Unit Lending Agreement The unit lending agreement dated 9 November 2007 entered into between the Stabilising Manager and the Unit Lender in connection with the Over-allotment Option Boardroom Corporate & Advisory Services Pte. Ltd. The registered holder for the time being of a Unit including persons so registered as joint holders, except that where the registered holder is CDP , the term Unitholder shall, in relation to Units registered in the name of CDP , mean, where the context requires, the depositor whose Securities Account with CDP is credited with Units Value-added tax Golden Acres Investment Ltd., Market Holdings Ltd., Millennium Capital Ltd., Superior Asset Investment Ltd., Victoria Investment Ltd., Dellmore Investment Ltd. and Tristar, companies incorporated in the Federal Territory of Labuan, Malaysia. Tristar is a wholly-owned subsidiary of Matahari. The Vendors, with the exception of Tristar, are not owned, whether wholly or partially, directly or indirectly, by the Sponsor The ratio of the value traded to the total volume traded over a particular time horizon In respect of each Retail Mall, this is derived by dividing the occupied area of the Retail Mall by the total NLA of the Retail Mall.

Unit Registrar or Share Registrar Unitholder

VAT Vendors

Volume Weighted Average Traded Price weighted average occupancy

Words importing the singular shall, where applicable, include the plural and vice versa. Words importing the masculine gender shall, where applicable, include the feminine and neuter genders. References to persons shall include corporations. Any reference in this Prospectus to any enactment is a reference to that enactment for the time being amended or re-acted. Any reference to a time of day in this Prospectus is made by reference to Singapore time unless otherwise stated.

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Appendix A
INDEPENDENT ACCOUNTANTS REPORT ON THE PROFIT FORECAST AND PROFIT PROJECTION 9 November 2007 The Board of Directors Lippo-Mapletree Indonesia Retail Trust Management Ltd (As manager of Lippo-Mapletree Indonesia Retail Trust) 78 Shenton Way #05-01 Lippo Centre Singapore 079120 The Board of Directors HSBC Institutional Trust Services (Singapore) Limited (As trustee of Lippo-Mapletree Indonesia Retail Trust) 21 Collyer Quay, #14-01 HSBC Building Singapore 049320 Dear Sirs LETTER FROM THE REPORTING ACCOUNTANTS ON THE PROFIT FORECAST FOR THE FINANCIAL PERIOD ENDING 31 DECEMBER 2007 AND THE PROFIT PROJECTION FOR THE FINANCIAL YEARS ENDING 31 DECEMBER 2008 AND 2009 This letter has been prepared for inclusion in the prospectus (the Prospectus) issued in connection with the offering of certain Units in Lippo-Mapletree Indonesia Retail Trust (LMIR Trust) (the Offering). We have examined the Profit Forecast of LMIR Trust for the financial period ending 31 December 2007 and the Profit Projection for the financial years ending 31 December 2008 and 2009 as set out on pages 98 to 100 of the Prospectus in accordance with Singapore Standards on Assurance Engagements 3400 The Examination of Prospective Financial Information. The Directors of Lippo-Mapletree Indonesia Retail Trust Management Ltd (the Directors) are responsible for the preparation and presentation of the forecast and projected Consolidated Statements of Total Return for the financial period ending 31 December 2007 (the Profit Forecast) and the financial years ending 31 December 2008 and 2009 (the Profit Projections) in each case with respect to LMIR Trust as set out on pages 98 to 100 of the Prospectus, including their assumptions as set out on pages 100 to 108 of the Prospectus. Profit forecast Based on our examination of the evidence supporting the assumptions, nothing has come to our attention which causes us to believe that these assumptions do not provide a reasonable basis for the Profit Forecast. Further, in our opinion the Profit Forecast, so far as the accounting policies and calculations are concerned, is properly prepared on the basis of the assumptions, is consistent with the accounting policies set out on pages B-10 to B-15 of Appendix B of the Prospectus, and is presented in accordance with the applicable presentation principles of Recommended Accounting Practice 7 Reporting Framework for Unit Trusts (but not all the required disclosures for the purpose of this letter) issued by the Institute of Certified Public Accountants of Singapore which is the framework adopted by LMIR Trust in the preparation of its financial statements. Profit projections The Profit Projections have been prepared to show a possible outcome based on the stated assumptions. As LMIR Trust is newly established without any history of activities and because the length of the period covered by the Profit Projections extend beyond the period covered by the Profit Forecast, the assumptions used in the Profit Projections (which include hypothetical assumptions about future events and
A-1

Appendix A managements actions that are not necessarily expected to occur) are more subjective than would be appropriate for a profit forecast. The Profit Projections do not therefore constitute a profit forecast. Based on our examination of the evidence supporting the relevant assumptions, nothing has come to our attention which causes us to believe that these assumptions do not provide a reasonable basis for the Profit Projections. Further, in our opinion the Profit Projections, so far as the accounting policies and calculations are concerned, are properly prepared on the basis of the assumptions, are consistent with the accounting policies set out on pages B-10 to B-15 of Appendix B of the Prospectus, and are presented in accordance with the applicable presentation principles of Recommended Accounting Practice 7 Reporting Framework for Unit Trusts (but not all the required disclosures for the purposes of this letter) issued by the Institute of Certified Public Accountants of Singapore which is the framework adopted by LMIR Trust in the preparation of its financial statements. Events and circumstances frequently do not occur as expected. Even if the events anticipated under the hypothetical assumptions occur, actual results are still likely to be different from the Profit Forecast and Profit Projections since other anticipated events frequently do not occur as expected and the variation may be material. The actual results may therefore differ materially from those forecast and projected. For the reasons set out above, we do not express any opinion as to the possibility of achievement of the Profit Forecast and Profit Projections. Attention is drawn, in particular to the risk factors set out on pages 65 to 87 of the Prospectus which describe the principal risks associated with the Offering, to which the Profit Forecast and Profit Projections relate and sensitivity analysis of the Directors Profit Forecast and Profit Projections set out on page 108 to 111 of the Prospectus. Yours faithfully

RSM Chio Lim Certified Public Accountants Singapore Partner in charge: Paul Lee Seng Meng A member of the Institute of Certified Public Accountants of Singapore

A-2

Appendix B
INDEPENDENT ACCOUNTANTS REPORT ON THE UNAUDITED PRO FORMA CONSOLIDATED BALANCE SHEET AS AT THE LISTING DATE 9 November 2007 The Board of Directors Lippo-Mapletree Indonesia Retail Trust Management Ltd (As manager of Lippo-Mapletree Indonesia Retail Trust) 78 Shenton Way #05-01 Lippo Centre Singapore 079120 The Board of Directors HSBC Institutional Trust Services (Singapore) Limited (As trustee of Lippo-Mapletree Indonesia Retail Trust) 21 Collyer Quay, #14-01 HSBC Building Singapore 049320 Dear Sirs INDEPENDENT ACCOUNTANTS REPORT ON THE UNAUDITED PRO FORMA CONSOLIDATED BALANCE SHEET AS AT THE LISTING DATE We report on the Unaudited Pro Forma Consolidated Balance Sheet of Lippo-Mapletree Indonesia Retail Trust (LMIR Trust) and its subsidiaries (the Pro Forma Group) as at the Listing Date (the Pro Forma Consolidated Balance Sheet) set out on pages B3 to B26 of Appendix B of the prospectus (the Prospectus) issued in connection with the offering of certain units in LMIR Trust, which has been prepared for illustrative purposes only and based on certain assumptions after making certain adjustments. The Pro Forma Consolidated Balance Sheet as at the Listing Date has been prepared on the basis of the assumptions set out in section C on pages B-5 to B-6 to provide information on the financial position of the Pro Forma Group, had the purchase of the seven retail malls comprising Gajah Mada Plaza; Cibubur Junction; The Plaza Semanggi; Mal Lippo Cikarang; Ekalokasari Plaza; Bandung Indah Plaza and Istana Plaza (collectively known as Retail Malls) and the purchase of the seven retail spaces comprising Mall WTC Matahari Units; Metropolis Town Square Units; Depok Town Square Units; Java Supermall Units; Malang Town Square Units; Plaza Madiun and Grand Palladium Medan Units (collectively known as Retail Spaces) been undertaken by LMIR Trust under the same terms set out in the Prospectus on the Listing Date. The Pro Forma Consolidated Balance Sheet has been prepared for illustrative purposes only and, because of its nature, may not give a true picture of the Pro Forma Groups actual financial position. The Pro Forma Consolidated Balance Sheet is the responsibility of the directors of Lippo-Mapletree Indonesia Retail Trust Management Ltd (the Directors). Our responsibility is to express an opinion on the Pro Forma Consolidated Balance Sheet based on our work. We carried out procedures in accordance with Singapore Statement of Auditing Practice 24 Auditors and Public Offering Documents. Our work, which involved no independent examination of the underlying financial information, consisted primarily of: (i) comparing the Pro Forma Consolidated Balance Sheet to the combined audited balance sheets of the seven Retail Malls property companies as at 31 December 2006, audited balance sheets of the seven Retail Spaces property companies and its seven investment holding companies as at 15 February 2007 and 10 February 2007 respectively, the unaudited balance sheets of the relevant Retail Malls ten investment holding companies as at incorporation date and four of the relevant Retail Malls investment holding companies as at 31 December 2006 and the unaudited financial statements of LMIR Trust at its constitution; and
B-1

Appendix B (ii) considering the evidence supporting the pro forma adjustments and discussing the Pro Forma Consolidated Balance Sheet with the Directors.

In our opinion: (a) the Pro Forma Consolidated Balance Sheet has been properly prepared from the combined financial statements of LMIR Trust and its subsidiaries (which are prepared in accordance with Singapore Financial Reporting Standards (FRS) and is presented in accordance with the relevant presentation principles of Recommended Accounting Practice 7 Reporting Framework for Unit Trusts issued by the Institute of Certified Public Accountants of Singapore; the Pro Forma Consolidated Balance Sheet has been properly prepared in a manner consistent with both the format of the balance sheet and the relevant accounting policies of LMIR Trust; each material adjustment to the information used in the computation of a financial effect relating to the Pro Forma Consolidated Balance Sheet is appropriate for the purpose of preparing such a Pro Forma Consolidated Balance Sheet and is in accordance with FRS; and the Pro Forma Consolidated Balance Sheet has been properly prepared on the basis of the assumptions and after making the adjustments as described in section C on pages B-5 to B-6.

(b) (c)

(d)

Yours faithfully

RSM Chio Lim Certified Public Accountants Singapore Partner in charge: Paul Lee Seng Meng A member of the Institute of Certified Public Accountants of Singapore

B-2

Appendix B LIPPO-MAPLETREE INDONESIA RETAIL TRUST UNAUDITED PROFORMA CONSOLIDATED BALANCE SHEET AS AT LISTING DATE (A) Introduction

The Unaudited Pro Forma Consolidated Balance Sheet of Lippo-Mapletree Indonesia Retail Trust (LMIR Trust) and its subsidiaries (the Pro Forma Group) as at the Listing Date (the Pro Forma Consolidated Balance Sheet) is for the purposes of the prospectus (the Prospectus) issued in connection with the offering of certain units in LMIR Trust, which has been prepared for illustrative purposes only and based on certain assumptions after making certain adjustments. LMIR Trust is a Singapore-based real estate investment trust constituted by a trust deed entered into between HSBC Institutional Trust Services (Singapore) Limited (the Trustee) and Lippo-Mapletree Indonesia Retail Trust Management Ltd (the Manager). LMIR Trust is established with the principal investment objective of owning and investing on a long-term basis in a diversified portfolio of incomeproducing real estate in Indonesia that are primarily used for retail and/or retail-related purposes, and real estate related assets in connection with the foregoing purposes. The sponsor for LMIR Trust is PT. Lippo Karawaci Tbk (Sponsor). Its initial property portfolio comprises the following seven retail malls and seven retail spaces (Properties): (1) Retail Malls (a) (b) (c) (d) (e) (f) (g) (2) Gajah Mada Plaza; Cibubur Junction; The Plaza Semanggi; Mal Lippo Cikarang; Ekalokasari Plaza; Bandung Indah Plaza; and Istana Plaza

Retail Spaces (a) (b) (c) (d) (e) (f) (g) Mall WTC Matahari Units; Metropolis Town Square Units; Depok Town Square Units; Java Supermall Units; Malang Town Square Units; Plaza Madiun; and Grand Palladium Medan Units

The subsidiaries held by the LMIR Trust are listed below: (i) Special purpose investment holding companies incorporated in Singapore (Investment Holding Companies) comprising Belilios International Pte Ltd, Dominion Capital Pte Ltd, Greenlot Investments Pte Ltd, Magnus Investments Pte Ltd, Pierbridge Investments Pte Ltd, Thornton Investments Pte Ltd, Tangent Investments Pte Ltd, Prism Investments Pte Ltd, Silver Dory Holdings Pte Ltd, Vernon Investments Pte Ltd, Maxia Investments Pte Ltd, Fenton Investments Pte Ltd, Langston Investments Pte Ltd, Bowland Investments Pte Ltd, Serpong Properties Pte Ltd, Metropolis Properties Pte Ltd, Matos Properties Pte Ltd, Detos Properties Pte Ltd, Palladium Properties Pte Ltd, Madiun Properties Pte Ltd and Java Properties Pte Ltd. Special purpose property companies incorporated in Indonesia (Property Companies) comprising PT Graha Baru Raya (Owner of Gajah Mada Plaza), PT Graha Nusa Raya (Owner of Mal Lippo
B-3

(ii)

Appendix B Cikarang), PT Cibubur Utama (Owner of Cibubur Junction), PT Megah Semesta Abadi (Owner of Bandung Indah Plaza), PT Suryana Istana Pasundan (Owner of Istana Plaza), PT Indah Pesona Bogor (Owner of Ekalokasari Plaza), PT Primatama Nusa Indah (Owner of The Plaza Semanggi), PT Dinamika Serpong (Owner of Mall WTC Matahari Units), PT Gema Metropolis Modern (Owner of Metropolis Town Square Units), PT Matos Surya Perkasa (Owner of Malang Town Square Units), PT Megah Detos Utama (Owner of Depok Town Square Units), PT Palladium Megah Lestari (Owner of Grand Palladium Medan Units), PT Madiun Ritelindo (Owner of Plaza Madiun) and PT Java Mega Jaya (Owner of Java Supermall Units). As at the Listing Date, the auditors of the Singapore incorporated subsidiaries are RSM Chio Lim, Singapore and the auditors of the Indonesian incorporated subsidiaries are RSM AAJ Associates, Indonesia a member firm of RSM International of which RSM Chio Lim is a member. All the Singapore subsidiaries and the Retail Spaces Property Companies were inactive before the date of the acquisition of the Properties mentioned above. All the above subsidiaries are effectively wholly-owned by LMIR Trust. (B) Pro Forma historical financial information

The pro forma consolidated statements of total return, consolidated cash flow statement and consolidated balance sheet have not been prepared to show the pro forma historical financial performance and position of LMIR Trust (Pro Forma Historical Financial Statements) for the following reasons: Gajah Mada Plaza and Mal Lippo Cikarang were recently acquired by the respective Retail Mall Property Companies, namely PT Graha Baru Raya and PT Graha Nusa Raya, in March 2006. Historical financial information for these two Retail Malls prior to their acquisition dates is not available from the previous vendors and, there is no comparable historical financial information for the full years ended 31 December 2004 and 31 December 2005; Bandung Indah Plaza, Ekalokasari Plaza and Mal Lippo Cikarang have recently undergone major refurbishments and other repositioning initiatives. Given the repositioning initiatives, the Manager is of the view that any attempt to present the historical pro forma financial performance based on the actual results of these three Retail Malls prior to their repositioning initiatives may not be comparable to the expected results of these Retail Malls after the repositioning initiatives; Cibubur Junction commenced its retail space leasing operations in September 2005. Given that there were no activities for Cibubur Junction prior to September 2005, the historical financial information on Cibubur Junctions performance would not be available for the full financial years ended 31 December 2004 and 31 December 2005. Accordingly, any historical pro forma financial information presented in respect of Cibubur Junctions short period of operations is unlikely to be meaningful or accurately reflect its financial performance; Each of the Retail Spaces was wholly-owned by PT Matahari Putra Prima Tbk (Matahari or Master Lessee) up to the Listing Date and was held for the use of Mataharis retail businesses. As the activities relating to the Retail Spaces form an intrinsic part of Mataharis core business operations, Matahari does not keep separate financial records on these Retail Spaces. Accordingly, historical financial data is unavailable for each Retail Space; and If historical pro forma financial information is prepared based on the terms of the Master Lease Agreements to be entered into between the Master Lessee and the relevant Retail Space Property Companies, such information will be in nature of a forecast and will not reflect the historical financial results and position of LMIR Trust with respect to the Retail Spaces. Assumptions and bases which are prospective in nature would need to be made if LMIR Trust is to assume that such arrangements were in place throughout the period covered by the historical pro forma financial information. As such, the Manager believes that such historical pro forma financial information will be of little value to investors in deciding whether to acquire the units but a profit forecast and profit projection based on, among other things, the terms of the Master Lease Agreements would be more meaningful to investors. For the reasons stated above, the SGX-ST has granted LMIR Trust a waiver from the requirement to prepare Pro Forma Historical Financial Statements. In lieu of Pro Forma Historical Financial Statements, a
B-4

Appendix B Pro Forma Consolidated Balance Sheet of LMIR Trust, upon completion of the offering and the acquisition of the Properties, has been prepared by the Manager as set out in section D below and a profit forecast for the period from 1 July 2007 to 31 December 2007 and profit projections for the financial years ending 31 December 2008 and 2009 have been included in the Prospectus. (C) Bases of preparation of Pro Forma Consolidated Balance Sheet as at the listing date

The Pro Forma Consolidated Balance Sheet as at the listing date is prepared for illustrative purposes only and based on certain assumptions after making certain adjustments. The Manager has assumed that the listing date is 1 July 2007 (Listing Date). The Pro Forma Consolidated Balance Sheet is prepared: based on the audited balance sheets of the seven Retail Malls Property Companies as at 31 December 2006 and audited balance sheets of the seven Retail Spaces Property Companies as at 15 February 2007; based on the audited balance sheets of the seven Retail Spaces Investment Holding Companies as at 10 February 2007; based on the unaudited balance sheets of the relevant ten Investment Holding Companies as at incorporation date and four of the relevant Investment Holding Companies as at 31 December 2006; based on the unaudited balance sheet of LMIR Trust as at its constitution; and incorporating adjustments necessary to reflect the financial position of the Pro Forma Group, pursuant to the terms set out in the Prospectus and bases set out below. The Pro Forma Consolidated Balance Sheet of LMIR Trust as at the Listing Date reflects the financial position of LMIR Trust as if it had purchased the Property Companies on the Listing Date under the same terms set out in the Prospectus. The Pro Forma Consolidated Balance Sheet has been prepared on the basis of the accounting policies set out in section F below. The objective of the Pro Forma Consolidated Balance Sheet of the Pro Forma Group is to show what the financial position might have been at the Listing Date, on the basis as described above. However, the Pro Forma Consolidated Balance Sheet is not necessarily indicative of the financial position that would have been actually attained by LMIR Trust on the Listing Date. The Pro Forma Consolidated Balance Sheet, because of its nature, may not give a true picture of the Pro Forma Groups financial position. The Pro Forma Consolidated Balance Sheet has been prepared after incorporating the following key adjustments: Adjustments to reflect the transfer of assets and liabilities from the Retail Malls Property Companies to the Operating Companies (namely cash and cash equivalents, trade and other receivables, other investments, certain plant and equipment, trade and other payables and borrowings). The Retail Mall Property Companies have entered into the Operating Costs Agreements with the Operating Companies. These agreements are more particularly described in Certain Agreements Relating to LMIR Trust and the PropertiesDescription of Operating Costs Agreements of the Prospectus. The financial statements of seven Retail Malls Property Companies have been restated from Indonesian GAAP to Singapore Financial Reporting Standards (FRS) (Restated FRS financial statements) to be in line with the accounting policies of LMIR Trust. RSM AAJ Associates were the auditors for this purpose. The Restated FRS financial statements have been qualified by RSM AAJ Associates to the extent that certain financial assets and financial liabilities of these Retail Malls Property Companies have not been fair valued, accounted and presented in accordance with the requirements of FRS 32 and 39. The Manager is of the view that there is no practical benefit in restating these financial assets and financial liabilities to FRS as these financial assets and financial liabilities will be transferred to the Operating Companies (see Note F15) at their carrying values as stated in accordance with Indonesian GAAP . As such, the Manager believes that restating the financial assets and financial liabilities to FRS will have no value to investors. The audited financial statements of these entities prepared in accordance with Indonesian GAAP were not qualified.
B-5

Appendix B Adjustments to record the capital expenditure incurred for the period between 1 January 2007 and the Listing Date amounting of approximately Rp. 51.9 billion (S$8,805,000) and the related depreciation thereof; Adjustment to accrue the Build, Operate and Transfer (BOT) liabilities, discounted at 14% which is approximate to the discount rate used by the property valuer in the valuation of the Properties; Adjustment to state the Properties at a total valuation of approximately Rp. 5.9 trillion (approximately S$1,004,679,000) and the deferred tax attributable to the revaluation of the Properties of approximately S$62,366,000. The valuation is based on an independent valuation dated 30 June 2007 carried out by Knight Frank / PT. Willson Properti Advisindo as at 30 June 2007; Adjustment to reflect LMIR Trusts issuance of 1,060,414,000 units at S$0.80 per unit, comprising 645,469,000 units under the Offering and 414,945,000 units allocated to Cornerstone investors for cash of approximately S$848,331,200 before issue costs; Adjustment to incorporate the incurrence of issue costs relating to the offering which is estimated at S$32,801,920; and Adjustment to incorporate the relevant estimated revenue, expense and deferred income and related taxes earned and incurred between 1 January 2007 and the Listing Date. In addition, the Manager has assumed the following: The valuations of the Properties adopted at the Listing Date remain unchanged from those as at 30 June 2007 based on the independent valuation report by Knight Frank / PT. Willson Properti Advisindo dated 30 June 2007; The issue price of the units under offering is S$0.80 per unit; The total acquisition cost of the Investment Holding Companies and the Property Companies is approximately S$815,529,280; The derivative financial instruments that will be contracted at the Listing Date will have no significant impact to the financial position of LMIR Trust; All agreements are enforceable and will be performed in accordance with their respective terms and conditions; Prior to the Listing Date, there will be no significant transactions in the seven Retail Spaces Property Companies and their respective Investment Holding Companies and, the Investment Holding Companies of the Retail Malls Property Companies; and Interest is earned based on the estimated monthly net cash inflow at an interest rate of 2% per year calculated on monthly basis. The Manager has assumed that the interest income earned will be subjected to Indonesia withholding tax of 20% and the funds will be kept in Indonesian Rupiah and Singapore dollars.

B-6

Appendix B (D) Pro Forma Consolidated Balance Sheet as at the Listing Date The Pro Forma Consolidated Balance Sheet as at the Listing Date has been prepared for inclusion in the Prospectus and is presented below. The assumptions used to prepare the Pro Forma Consolidated Balance Sheet are consistent with those described in Bases of Preparation of the Pro Forma Consolidated Balance Sheet in section C. The following combined balance sheet comprises the relevant audited and unaudited balance sheets of LMIR Trust and its subsidiaries.
Pro forma adjustments (see section E below) S$000 Pro forma consolidated balance sheet as at listing date S$000

Notes

Combined balance sheet S$000

ASSETS Current assets Cash and cash equivalents . . . . . . . . . . . . . . . . Trade and other receivables . . . . . . . . . . . . . . . Total current assets . . . . . . . . . . . . . . . . . . . Non-current assets Other receivables . . . . . . . . . . . . . . . . . . . . . . Other investment . . . . . . . . . . . . . . . . . . . . . . Property, plant and equipment . . . . . . . . . . . . Investment properties . . . . . . . . . . . . . . . . . . . Total non-current assets . . . . . . . . . . . . . . . LIABILITIES Current liabilities Trade and other payables . . . . . . . . . . . . . . . . Current tax payable . . . . . . . . . . . . . . . . . . . . Borrowings from financial institutions . . . . . . . Current portion of finance leases . . . . . . . . . . Non-current liabilities Deferred tax liabilities . . . . . . . . . . . . . . . . . . . Deferred income . . . . . . . . . . . . . . . . . . . . . . . Other payables . . . . . . . . . . . . . . . . . . . . . . . . Long-term borrowings from financial institutions . . . . . . . . . . . . . . . . . . . . . . . . . . Finance leases . . . . . . . . . . . . . . . . . . . . . . . . Total non-current liabilities . . . . . . . . . . . . . . . . . . .

F3 F4

9,270 19,938 29,208 10,997 27,934 247,106 286,037 315,245

77,651 (6,355) 71,296 (10,997) (27,934) (247,106) 1,004,679 718,642 789,938

86,921 13,583 100,504 1,004,679 1,004,679 1,105,183

F5

Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . .

F6

F7

8,807 4,709 22,444 35,960

(7,020) (246) (22,444) 148 (29,562) 62,366 (24,832) (119,624) (26,345) 1,041 (107,394) (136,956) 926,894 789,938

1,787 4,463 148 6,398 62,366 66,849 5,213 1,041 135,469 141,867 963,316 1,105,183

Total current liabilities . . . . . . . . . . . . . . . . . . . . . . . . F8 F6 F6

91,681 124,837 26,345 242,863 278,823

F7

Total liabilities . . . . . . . . . . . . . . . . . . . . . . . . Unitholders funds Net assets attributable to Unitholders . . . . . . . . Total liabilities and Unitholders funds. . . . . . . . . F9

36,422 315,245

See accompanying notes to the Pro Forma Consolidated Balance Sheet.

B-7

Appendix B (E) Pro Forma adjustments

In arriving at the Pro Forma Consolidated Balance Sheet of the Pro Forma Group at the Listing Date, the following pro forma adjustments were made:
S$000

(i)

Cash and cash equivalents Rental deposits received . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Transfer of cash to the Operating Companies . . . . . . . . . . . . . . . . . . . . . . . . . . . Acquisition of Investment Holding and Property Companies . . . . . . . . . . . . . . . . . Proceeds from issuance of units . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Net cash injection by Operating Companies and Vendors . . . . . . . . . . . . . . . . . . Capital expenditure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Refund arising from rearrangement of leases. . . . . . . . . . . . . . . . . . . . . . . . . . . . Cash arising from rentals collected in advance (net of tax) and other operating activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Trade and other receivables Transfer of assets to the Operating Companies . . . . . . . . . . . . . . . . . . . . . . . . . . Prepaid tax for rents collected in advance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Amortisation of prepaid tax . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Prepaid tax written off . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Trade receivables for the period. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Total

. . . . . . . . . . . . . .

3,754 (9,270) (815,529) 815,529 94,870 (8,805) (29,623) 26,725 77,651 (5,702) 2,597 (2,572) (2,956) 2,278 (6,355) (10,997) (27,934) (1,061) 8,805 (4,620) (250,230) (247,106) 796,792 207,887 1,004,679 (5,914) 1,167 (2,273) (7,020) (246) (22,444) (26,345)

(ii)

(iii) (iv) (v)

Other receivables (Non-current) Transfer of assets to the Operating Companies . . . . . . . . . . . . . . . . . . . . . . . . . . . Other investments Transfer of assets to the Operating Companies . . . . . . . . . . . . . . . . . . . . . . . . . . . Property, Plant and Equipment Transfer of assets to the Operating Companies . . . . . . . . . . . . . . . . . . . . . . . . . . Capital expenditure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Depreciation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Reclassification to investment properties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Total . . . .

(vi)

Investment properties Investment properties acquired . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Revaluation surplus . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Trade and other payables Transfer of liabilities to the Operating Companies. . . . . . . . . . . . . . . . . . . . . . . . . . Rental received in advance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Trade and other payables for the period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Total Taxes payable Net tax paid during the period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Borrowings from financial institutions Short term: Transfer of liabilities to the Operating Companies . . . . . . . . . . . . . . . . Long-term: Transfer of liabilities to the Operating Companies. . . . . . . . . . . . . . . . .

(vii)

(viii) (ix)

B-8

Appendix B
S$000

(x)

Finance leases Accrual of BOT Fees (see Note F15) Short term . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Long-term . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Deferred tax Deferred tax arising from the revaluation of investment properties . . . . . . . . . . . . . Deferred income Net increase during the period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Refund arising from rearrangement of leases. . . . . . . . . . . . . . . . . . . . . . . . . . . . . Total

148 1,041 62,366 4,791 (29,623) (24,832)

(xi) (xii)

(xiii) Other payables (Non-current) Transfer of liabilities to the Operating Companies. . . . . . . . . . . . . . . . . . . . . . . . . Interest accrued on certain financial liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . Rental deposits net of fair value adjustment at the Listing Date . . . . . . . . . . . . . . Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (xiv) Net assets attributable to Unitholders Issuance of units . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Fair value adjustment on rental deposits at the Listing Date . . . . . . . . . . . . . . . . . Total net return for the period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Elimination of pre-acquisition reserves . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Revaluation surplus net of deferred tax . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . .

(121,493) 49 1,820 (119,624) 815,529 2,266 16,066 (52,488) 145,521 926,894

B-9

Appendix B (F) 1. Notes to the Pro Forma Consolidated Balance Sheet Summary of significant accounting policies

The following is a summary of the significant accounting policies of the Pro Forma Group which has been consistently applied in preparing the Pro Forma Consolidated Balance Sheet set out in this report. Accounting convention The financial statements are prepared under the historical cost convention except where Singapore Financial Reporting Standards (FRS) require an alternative treatment (such as fair values) as disclosed where appropriate in these financial statements. Basis of preparation The Pro Forma Consolidated Balance Sheet is prepared in accordance with the bases set out in section C and applied to financial information prepared in accordance with the Statement of Recommended Accounting Practice (RAP) 7 Reporting Framework for Unit Trusts issued by the Institute of Certified Public Accountants of Singapore, FRS and the applicable requirements of the Code on Collective Investment Schemes issued by the Monetary Authority of Singapore (MAS) and the provisions of the Trust Deed. The Pro Forma Consolidated Balance Sheet is presented in Singapore dollar and rounded to the nearest thousand, unless otherwise stated. The preparation of financial statements in conformity with generally accepted accounting principles requires the management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The estimates and assumptions are reviewed on an ongoing basis. Apart from those involving estimations, management has made judgments in the process of applying the entitys accounting policies. The areas requiring managements most difficult, subjective or complex judgments, or areas where assumptions and estimates are significant to the financial statements, are disclosed at the end of this footnote, where applicable. Basis of presentation The consolidation accounting method is used for the consolidated financial statements which include the financial statements made up to the balance sheet date of the Trust and of those companies in which it holds, directly or indirectly through subsidiaries, over 50 percent of the shares and voting rights (its subsidiaries including special purpose entities). Consolidated financial statements are the financial statements of the group presented as those of a single economic entity. The consolidated financial statements are prepared using uniform accounting policies for like transactions and other events in similar circumstances. All significant intragroup balances and transactions, including income, expenses and dividends, are eliminated in full on consolidation. The results of the investees acquired or disposed of during the financial year are consolidated from the respective dates of acquisition or up to the dates of disposal. On disposal the attributable amount of goodwill is included in the determination of the gain or loss on disposal. Subsidiaries A subsidiary is an entity including unincorporated and special purpose entity that is controlled by the group. Control is the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities accompanying a shareholding of more than one half of the voting rights or the ability to appoint or remove the majority of the members of the board of directors or to cast the majority of votes at meetings of the board of directors. The existence and effect of potential voting rights that are currently exercisable or convertible are considered when assessing whether the group controls another entity. In the Trusts own separate financial statements, the investments in subsidiaries are stated at cost less any provision for impairment in value. Impairment loss recognised in profit or loss for a subsidiary is reversed only if there has been a change in the estimates used to determine the assets recoverable amount since the last impairment loss was recognised. The net book values of the subsidiaries are not necessarily indicative of the amounts that would be realised in a current market exchange.
B-10

Appendix B Cash and cash equivalents Cash and cash equivalents include bank and cash balances and any highly liquid debt instruments purchased with an original maturity of three months or less. Trade receivables After initial recognition at fair value, trade receivables are measured at amortised cost using the effective interest method except that short-duration receivables with no stated interest rate are normally measured at original invoice amount unless the effect of imputing interest would be significant. Trade receivables are stated after provision for impairment. The amount of the provision for impairment is recognized in the statement of total return. A trade receivable amount is regarded as impaired if there is objective evidence of impairment as a result of one or more events that occurred after the initial recognition and that loss event has an impact on the estimated future cash flows of the financial asset that can be reliably estimated. The carrying amounts of trade receivables are assumed to approximate their fair value. Normally no interest is charged on trade receivables. Loans and other receivables Loans and other receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market, other than: (a) those that the entity intends to sell immediately or in the near term and are classified as held for trading, and those that the entity upon initial recognition designates as at fair value through profit or loss; (b) those that the entity upon initial recognition designates as available for sale; or (c) those for which the holder may not recover substantially all of its initial investment, other than because of credit deterioration and are classified as available for sale. Items with a short duration are not discounted. After initial recognition such financial assets, including derivatives that are assets, are measured at their fair values, without any deduction for transaction costs that may be incurred on sale or other disposal, except for the non-current financial assets that are loans and receivables which are measured at amortised cost using the effective interest method less provision for impairment. These items are included in the balance sheet in loans and receivables as current assets or as non-current assets where the maturities are greater than 12 months after the balance sheet date. Investment properties Investment property is property owned or held under a finance lease to earn rentals or for capital appreciation or both, rather than for use in the production or supply of goods or services or for administrative purposes or sale in the ordinary course of business. After initial recognition at cost including transaction costs the fair value model is used to measure the investment property at fair value on the existing use basis to reflect the actual market state and circumstances as of the balance sheet date, not as of either a past or future date. A gain or loss arising from a change in the fair value of investment property is included in the statement of total return for the period in which it arises. The revaluations are made periodically on a systematic basis at least once yearly by external independent valuers having an appropriate recognised professional qualification and recent experience in the location and category of property being valued. Net assets attributable to Unitholders Net assets attributable to Unitholders represents the Unitholders residual interest in LMIR Trusts net assets upon termination. Expenses incurred in connection with the initial public offering of LMIR Trust are deducted directly from net assets attributable to Unitholders. Impairment of non-financial assets At each full year balance sheet date an assessment is made whether there is any indication that a depreciable or amortisable asset may be impaired. If any such indication exists, an estimate is made of the recoverable amount of the asset. Irrespective of whether there is any indication of impairment, an annual impairment test is performed at the same time every year on an intangible asset with an indefinite useful life or an intangible asset not yet available for use. The impairment loss is the excess of the carrying amount over the recoverable amount and is recognised in the statement of total return unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease. The recoverable amount of an asset or a cash-generating unit is the higher of its fair value less
B-11

Appendix B costs to sell and its value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (cash-generating units). At each reporting date non-financial assets other than goodwill with impairment loss recognised in prior periods are assessed for possible reversal of the impairment. An impairment loss is reversed only to the extent that the assets carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised. Impairment of financial assets All financial assets except those measured at fair value through profit or loss are subject to review for impairment. A financial asset or a group of financial assets is impaired and impairment losses are incurred if there is objective evidence of impairment as a result of one or more events that occurred after the initial recognition of the asset (a loss event) and that loss event (or events) has an impact on the estimated future cash flows of the financial asset or group of financial assets that can be reliably estimated. Losses expected as a result of future events, no matter how likely, are not recognised. Financial liabilities Financial liabilities at fair value through profit or loss when recognised initially are measured at fair value. Financial liabilities not at fair value through profit or loss are measured at fair value plus transaction costs that are directly attributable to the acquisition or issue of the financial liability. After initial recognition financial liabilities at fair value through profit or loss, including derivatives that are financial liabilities, are measured at fair value. Other financial liabilities not at fair value through profit or loss are measured at amortised cost and any difference between the proceeds (net of transaction costs) and the redemption value is recognised in the statement of total return over the period of the borrowings using the effective interest method. Financial liabilities including bank and other borrowings are classified as current liabilities unless there is an unconditional right to defer settlement of the liability for at least 12 months after the balance sheet date. Items classified within trade and other payables are not usually re-measured, as the obligation is usually known with a high degree of certainty and settlement is short-term. Liabilities and provisions A liability or provision is recognised when there is a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. These include trade and other payables and where the effect of the time value of money is material, the amount recognised is the present value of the expenditures expected to be required to settle the obligation using a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the obligation. The increase in the provision due to passage of time is recognised as interest expense. Leases as a lessee A finance lease is a lease that transfers substantially all the risks and rewards incidental to ownership of an asset. At the commencement of the lease term, a finance lease is recognised as an asset and as liability in the balance sheet at amounts equal to the fair value of the leased asset or, if lower, the present value of the minimum lease payments, each determined at the inception of the lease. The discount rate used in calculating the present value of the minimum lease payments is the interest rate implicit in the lease, if this is practicable to determine; if not, the lessees incremental borrowing rate is used. Any initial direct costs of the lessee are added to the amount recognised as an asset. The excess of the lease payments over the recorded lease liability are treated as finance charges which are allocated to each period during the lease term so as to produce a constant periodic rate of interest on the remaining balance of the liability. Contingent rents are charged as expenses in the periods in which they are incurred. The assets are depreciated as owned depreciable assets. Leases where the lessor effectively retains substantially all the risks and benefits of ownership of the leased assets are classified as operating leases. For operating leases, lease payments are recognised as an expense in the statement of total return on a straight-line basis over the term of the relevant lease unless another systematic basis is representative of the time pattern of the users benefit, even if the payments are not on that basis. Lease incentives received are recognised in the statement of total return as an integral part of the total lease expense.
B-12

Appendix B Leased assets Leases in terms of which the entity assumes substantially all the risks and rewards of ownership are classified as finance leases. The owner-occupied property acquired by way of finance lease is stated at an amount equal to the lower of its fair value and the present value of the minimum lease payments at inception of the lease, less accumulated depreciation and impairment losses. A property held under a finance lease and leased out under operating lease is classified as investment property and stated at the fair value. Lease payments are accounted for as described in these accounting policies. Property held under operating leases that would otherwise meet the definition of investment property is classified as investment property. Liabilities and equity financial instruments A financial instrument is classified as a liability or as equity in accordance with the substance of the contractual arrangement on initial recognition. Where the financial instrument does not give rise to a contractual obligation on the part of the issuer to make payment in cash or kind under conditions that are potentially unfavourable, it is classified as an equity instrument. The equity and the liability elements of compound instruments are classified separately as equity and as a liability. Equity instruments are recorded at the proceeds, net of direct issue costs. Fair value of financial instruments The carrying values of current financial assets and financial liabilities including cash, accounts receivable, short-term borrowings, accounts payable approximate their fair values due to the short-term maturity of these instruments. The fair values of non-current financial instruments are not disclosed unless there are significant items at the end of the year and in the event the fair values are disclosed in the relevant notes. Disclosures of fair value are not made when the carrying amount is a reasonable approximation of fair value. The maximum exposure to credit risk is the fair value of the financial instruments at the balance sheet date. Cash flow hedge Where a derivative financial instrument is designated as a hedge of the variability in cash flows of a recognised asset or liability, or a highly probable forecast transaction, the effective part of any gain or loss on re-measurement of the derivative financial instrument to fair value is recognised directly in hedging reserve. The ineffective part of any gain or loss is recognised immediately in the statement of total return. When the forecast transaction subsequently results in the recognition of a non-financial asset or nonfinancial liability, or the forecast transaction for a non-financial asset or non-financial liability becomes a firm commitment for which fair value hedge accounting is applied, the associated cumulative gain or loss is removed from hedging reserve and included in the initial cost or other carrying amount of the non-financial asset or liability. If a hedge of a forecast transaction subsequently results in the recognition of a financial asset or financial liability, the associated gains and losses that were recognised directly in hedging reserve are reclassified into the statement of total return in the same period or periods during which the asset acquired or liability assumed affects the statement of total return (i.e. when interest income or expense is recognised). For other cash flow hedges, the associated cumulative gain or loss is removed from hedging reserve and recognised in the statement of total return in the same period or periods during which the hedged forecast transaction affects the statement of total return. When a hedging instrument expires or is sold, terminated or exercised, or the designation of the hedge relationship is revoked but the hedged forecast transaction is still expected to occur, the cumulative gain or loss at that point remains in hedging reserve and is recognised in accordance with the above policy when the transaction occurs. If the hedged forecast transaction is no longer expected to take place, the cumulative unrealised gain or loss recognised in hedging reserve is recognised immediately in the statement of total return. Foreign currency transactions The functional currency is the Singapore dollar as it reflects the primary economic environment in which the Trust operates. Transactions in foreign currencies are recorded in the functional currency at the rates ruling at the dates of the transactions. At each balance sheet date, recorded monetary balances and balances measured at fair value that are denominated in foreign currencies are reported at the rates ruling
B-13

Appendix B at the balance sheet and fair value dates respectively. All realised and unrealised exchange adjustment gains and losses are dealt with in the statement of total return. The presentation is in the functional currency. Foreign currency financial statements The foreign entities determine the appropriate functional currency as it reflects the primary economic environment in which the entities operate. In translating the financial statements of a foreign entity for incorporation in the consolidated financial statements the assets and liabilities denominated in currencies other than the functional currency of the entity are translated at rate of Rp. 1 to S$0.000169 (or S$1 to Rp. 5,900) as at 31 December 2006. The same rate has been used in translating the pro forma adjustments set out section E of this report. The resulting translation adjustments (if any) are accumulated in a separate component of equity until the disposal of the foreign entity. Revenue recognition The revenue amount is the fair value of the consideration received or receivable from the gross inflow of economic benefits during the year arising from the course of the ordinary activities of the entity and it is shown net of related tax and discounts, if any. Revenue from rendering of services that are of short duration is recognised when the services are completed. Rental revenue is recognised on a time-proportion basis that takes into account the effective yield on the asset. Rental received in advance is amortised on timeproportion basis. Interest revenue is recognised on a time-proportion basis using the effective interest rate that takes into account the effective yield on the asset. A fair value gain or loss on a financial asset or financial liability classified as at fair value through profit or loss that is not part of a hedging relationship is recognised in profit or loss. A fair value gain or loss on an available-for-sale financial asset is recognised directly in equity, except for impairment losses and foreign exchange gains and losses until the financial asset is derecognised, at which time the cumulative gain or loss previously recognised in equity is recognised in profit or loss. However, interest calculated using the effective interest method is recognised in profit or loss. Dividends on equity instrument are recognised in profit or loss when the entitys right to receive payment is established. For financial assets and financial liabilities carried at amortised cost, a gain or loss is recognised in profit or loss when the financial asset or financial liability is derecognised or impaired, and through the amortisation process. However, hedged items are taken to equity. Borrowing costs All borrowing costs that are interest and other costs incurred in connection with the borrowing of funds are recognised as an expense in the period in which they are incurred except for borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying asset that necessarily take a substantial period of time to get ready for their intended use or sale are capitalised as part of the cost of that asset until substantially all the activities necessary to prepare the qualifying asset for its intended use or sale are complete. The interest expense is calculated using the effective interest rate method. Income tax The income taxes are accounted using the asset and liability method that requires the recognition of taxes payable or refundable for the current year and deferred tax liabilities and assets for the future tax consequence of events that have been recognised in the financial statements or tax returns. The measurements of current and deferred tax liabilities and assets are based on provisions of the enacted or substantially enacted tax laws; the effects of future changes in tax laws or rates are not anticipated. Income tax expense represents the sum of the tax currently payable and deferred tax. Deferred tax assets and liabilities are offset when they relate to income taxes levied by the same income tax authority. The carrying amount of deferred tax assets is reviewed at each balance sheet date and is reduced, if necessary, by the amount of any tax benefits that, based on available evidence, are not expected to be realised. A deferred tax amount is recognised for all temporary differences, unless the deferred tax amount arises from (a) goodwill for which amortisation is not deductible for tax purposes; or (b) the initial recognition of an asset or liability in a transaction which (i) is not a business combination; and (ii) at the time of the transaction, affects neither accounting profit nor taxable profit (tax loss). A deferred tax liability is not recognised for all taxable temporary differences associated with investments in subsidiaries, and interests in joint ventures because (a) the company is able to control the timing of the reversal of the
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Appendix B temporary difference; and (b) it is probable that the temporary difference will not reverse in the foreseeable future. Taxes relating to items directly related to Unitholders funds, in which case it is recognised in Unitholders Funds.

Segment reporting A business segment is a distinguishable component of an enterprise that is engaged in providing an individual product or service or a group of related products or services and that is subject to risks and returns that are different from those of other business segments. A geographical segment is a distinguishable component that is engaged in providing products or services within a particular economic environment and that is subject to risks and returns that are different from those of components operating in other economic environments. Segment information has not been presented as all of the Pro Forma Groups investment properties are used primarily for retail purposes and are all located in Indonesia.

Critical judgements, assumptions and estimation uncertainties Other than as disclosed in section C of this report, there were no critical judgments made in the process of applying the entitys accounting policies that have the most significant effect on the amounts recognised in the financial statements. There were no key assumptions concerning the future, and other key sources of estimation uncertainty at the balance sheet date, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year.

Risk management policies for financial instruments GENERAL RISK MANAGEMENT PRINCIPLESThe financial instruments comprise borrowings, some cash and liquid resources, and various items, such as trade and other receivables, trade and other payables. The main purpose of these financial instruments is to raise finance for the entitys operations. The main risks arising from the entitys financial instruments are credit risk, interest risk, liquidity risk, foreign currency risk and market price risk comprising interest rate and currency risk exposures. The management reviews and monitors policies for managing each of these risks and they are summarised below. CREDIT RISK ON FINANCIAL ASSETSFinancial assets that are potentially subject to concentrations of credit risk and failures by counterparties to discharge their obligations consist principally of cash, cash equivalents and trade and other accounts receivable. Credit risk on cash balances and derivative financial instruments is limited because the counter-parties are banks with high credit ratings. An ongoing credit evaluation is performed of the debtors financial condition and a loss from impairment is recognised in the statement of total return. There is no significant concentration of credit risk, as the exposure is spread over a large number of counter-parties and customers unless otherwise disclosed in the notes to the financial statements. OTHER RISKS ON FINANCIAL INSTRUMENTSThe main risks arising from the entitys financial instruments are interest risk, liquidity risk and foreign currency risk. The operations will be financed through a mixture of retained earnings and borrowings. Borrowings are in the desired currencies at both fixed and floating rates of interest. The policy is to retain flexibility in selecting borrowings at both fixed and floating interest rates. There is exposure to interest rate price risk for financial instruments with a fixed interest rate and to interest rate or cash flow risk for financial instruments with a floating interest rate that is reset as market rates change. Interest rate swaps may be used to generate the desired interest profit and to manage the exposure to interest rate fluctuations. There is also exposure to liquidity. As regards to liquidity, the policy has been to ensure continuity of funding and where necessary a certain percentage of the borrowings should mature in two to five years. Short-term flexibility is achieved by overdraft facilities. There is also exposure to changes in foreign exchange rates arising from foreign currency transactions and balances and changes in fair values. The Pro Forma Group has planned to utilise currency derivatives to eliminate or reduce the exposure of its foreign currency and to hedge future transactions and cash flows. As a matter of principle, the Pro Forma Group does not enter into derivative contracts for speculative purposes.
B-15

Appendix B 2. Related party transactions

A related party is an entity or person that directly or indirectly through one or more intermediaries controls, is controlled by, or is under common or joint control with, the entity in governing the financial and operating policies, or that has an interest in the entity that gives it significant influence over the entity in financial and operating decisions. It also includes members of the key management personnel or close members of the family of any individual referred to herein and others who have the ability to control, jointly control or significantly influence by or for which significant voting power in such entity resides with, directly or indirectly, any such individual. This includes the Sponsor, the Manager, parents, subsidiaries, fellow subsidiaries, associates, joint ventures and post-employment benefit plans, if any. 2.1 Related parties transactions

Transactions with related parties mainly consists of trade receivables, intercompany advances and charges, and loans. The related party transactions are made on terms equivalent to those that prevail in market rated transactions unless otherwise disclosed. The current intercompany balances are unsecured without fixed repayment terms and interest unless stated otherwise. For non-current balances an interest is imputed based on the cost of borrowing less the interest rate if any provided in the agreement for the balance. Intragroup transactions and balances that have been eliminated in the Pro Forma Consolidated Balance Sheet are not disclosed as related party transactions and balances below. The trade transactions and the trade receivables and payables balances arising from lease of spaces and services rendered are disclosed elsewhere in the notes to the Pro Forma Consolidated Balance Sheet. In addition to the transactions and balances disclosed elsewhere in the notes to the Pro Forma Consolidated Balance Sheet, the Trustee, on behalf of LMIR Trust, has entered into a number of transactions with the Manager and certain related parties of the Manager in connection with the setting up of LMIR Trust and the Offering as follows: The Trustee has entered into the Trust Deed with the Manager. The terms of the Trust Deed are generally described in The Formation and Structure of LMIR Trust of the Prospectus. The Retail Space Property Companies, which will be indirectly owned by the Trustee as at the Listing Date, have entered into the Master Lease Agreements with the Master Lessee for the operation, maintenance, management and marketing of the Retail Spaces. These agreements are more particularly described in Certain Agreements Relating to LMIR Trust and the Properties Description of the Master Lease Agreements of the Prospectus. The Retail Mall Property Companies, which will be indirectly owned by the Trustee as at the Listing Date, have entered into the Operating Costs Agreements with the Operating Companies. These agreements are more particularly described in Certain Agreements Relating to LMIR Trust and the Properties Description of the Operating Costs Agreements of the Prospectus. The Trustee has entered into the Singapore SPC Share Purchase Agreements with the Vendors for the acquisition of all the ordinary shares and redeemable preference shares in each of the Target Singapore Investment Holding Companies. These agreements are more particularly described in Certain Agreements Relating to LMIR Trust and the PropertiesDescription of the Singapore SPC Share Purchase Agreements of the Prospectus. The Trustee has also entered into the Deeds of Indemnity with Lippo Capital Limited pursuant to which Lippo Capital Limited will, subject to certain conditions, indemnify the Trustee against liabilities or damage suffered by the Trustee arising from any of the Singapore SPC Share Purchase Agreements. These agreements are more particularly described in Certain Agreements Relating to LMIR Trust and the PropertiesDescription of the Deeds of Indemnity of the Prospectus. The Retail Mall Property Companies, which will be indirectly owned by the Trustee as at the Listing Date, have entered into the Existing Property Management Agreements with the Property Manager for the operation, management, maintenance and marketing of the Retail Malls. These agreements are more particularly described in Certain Agreements Relating to LMIR Trust and the PropertiesDescription of the Existing Property Management Agreements of the Prospectus.
B-16

Appendix B The Trustee, the Manager and the Property Manager have entered into the Master Property Management Agreement pursuant to which the Property Manager was appointed to operate, maintain, manage and market all the properties of LMIR Trust located in Indonesia acquired after the Listing Date, subject to the overall management of the Manager. This agreement is more particularly described in Certain Agreements Relating to LMIR Trust and the PropertiesDescription of the Master Property Management Agreement of the Prospectus. 3. Cash and cash equivalents
S$000

Not restricted in use . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Analysis of above amount denominated in foreign currency: Indonesian Rupiah . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . The effective rate of interest for interest earning balances is 2% per year. 4. Trade and other receivables

86,921 20,072

S$000

Trade receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VAT receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Prepaid taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Total Analysis of above amount denominated in foreign currency: Indonesian Rupiah . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

2,277 6,023 5,283 13,583 13,583

Prepaid taxes refer to tax paid on the rents received in advance. The amount is expensed to statement of total return when the rent is recognised as income. 5. Investment properties
S$000

At valuation: Additions at cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Revaluation surplus included in the statement of total return . . . . . . . . . . . . . . . . . . . . . . . Fair value at the Listing Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

796,792 207,887 1,004,679

All the Properties are located in Indonesia. Investment properties comprise Retail Malls and Retail Spaces that are leased to customers. Details of the investment properties are as follows:
At valuation as at listing date S$000 Percentage of total net assets attributable to Unitholders %

Description of property

Location

Retail Malls Gajah Mada Plaza(c) Cibubur Junction(b) The Plaza Semanggi(b) Mal Lippo Cikarang(a) Ekalokasari Plaza(b) Bandung Indah Plaza(b) Istana Plaza(b) Sub total

Jakarta . . . . . . . . . . . . . . . Jakarta . . . . . . . . . . . . . . . Jakarta . . . . . . . . . . . . . . . Cikarang, Greater Jakarta Bogor, Greater Jakarta . . . Bandung, West Java . . . . Bandung, West Java . . . .

.. .. .. .. .. .. ..

.. .. .. .. .. .. ..

.. .. .. .. .. .. ..

103,780 94,186 214,847 80,186 66,017 124,458 125,729 809,203

10.8 9.8 22.3 8.3 6.9 12.9 13.1 84.0

B-17

Appendix B
Percentage of total net assets attributable to Unitholders %

Description of property

Location

At valuation as at listing date S$000

Retail Spaces Mall WTC Matahari Units(c) Metropolis Town Square Units(d) Depok Town Square Units(d) Java Supermall Units(c) Malang Town Square Units(d) Plaza Madiun(a) Grand Palladium Medan Units(d)

Tangerang, Greater Jakarta . Tangerang, Greater Jakarta . Depok, Greater Jakarta . . . . Semarang, Central Java . . . . Malang, East Java . . . . . . . . Madiun, Central Java . . . . . . Medan, North Sumatra . . . . .

.. .. .. .. .. .. ..

.. .. .. .. .. .. ..

25,170 33,542 25,661 25,983 25,543 33,424 26,153 195,476 1,004,679

2.6 3.5 2.7 2.7 2.7 3.5 2.7 20.3

Sub total Total investment properties, at valuation (a)

(b)

The title/right held by LMIR Trust is Hak Guna Bangunan (HGB). A holder of HGB title has the right to erect, occupy and use buildings on that particular parcel of land, and also has the right to encumber and sell all or part of the parcel. These properties are under build operate and transfer arrangements (BOT) (see Note F15 ). This right is granted by the land owner to the Retail Malls Property Companies, who are given the right to build and operate the Retail Malls for a particular period of time in exchange for payment of certain compensation as stipulated in the BOT agreements. Specific terms and conditions apply for each BOT agreement and its addendums. The title/right held by LMIR Trust is strata title. For strata titles, under the Indonesian land law, a building developer must divide the multi-storey building into (i) rights of ownership (strata title) on each unit, (ii) rights on common properties and (iii) rights to common land in the form of a sketch plan, which must be approved by the relevant authority. Such sketch plan must also provide an explanation on (i) unit separation that can be used by individuals, (ii) the limitation and separation of the strata title right over common properties and (iii) the strata title right over the common land. These retail spaces are each bound by Kiosks Sale and Purchase Binding Agreements because their strata titles are in the process of being issued by the Indonesian government. See also Note F15.

(c)

(d)

Other details on the Properties are disclosed in the Prospectus. Please also refer to the revaluation selected by the Manager as disclosed in the Prospectus. The carrying amounts of the investment properties as at the Listing Date are based on an independent valuation dated 30 June 2007 undertaken by Knight Frank / PT. Willson Properti Advisindo as of 30 June 2007. The valuations were based on the Income Method of valuation utilising a Discounted Cashflow Analysis and Income Capitalisation Method. 6. Trade and other payables / deferred income
S$000

Rental deposits from tenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Deferred incomeRetail Spaces . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Others . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Total trade and other payables (Current) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Other payables (Non-current)Rental deposits from tenants . . . . . . . . . . . . . . . . . . . . . . . . . Deferred income (Non-current)Retail Malls . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Analysis of above amount denominated in foreign currency: Indonesian Rupiah . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

394 1,166 227 1,787 5,213 66,849 73,849

B-18

Appendix B Deferred income represents rent received in advance. The amount is recognised to statement of total return over the period of the relevant leases. Long-term other payables represent rental deposits from tenants. The amount includes rental deposits of Rp. 20.6 billion (S$3,500,000) from a related party of the Sponsor. In addition, the related party has provided bankers guarantee equivalent to three months deposit of approximately Rp. 20.6 billion (S$3,500,000). Long-term rental deposits is stated at amortised cost which is approximate to fair value. 7. Finance lease liabilities

Finance lease represents BOT fees payable (see Note F15 for further details). The amount carries a notional interest rate of 14% per year. 8. Deferred tax liabilities

This refers to deferred tax arising from the revaluation of the investment properties. 9. Net assets attributable to Unitholders
S$000

Unitholders contribution From creation of units . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Unit issue costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Net contribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Fair value adjustments of rental deposit as at the Listing Date . . . . . . . . . . . . . . . . . . . . . Surplus on revaluation of investment properties, net of deferred tax . . . . . . . . . . . . . . . . . Total increase in net assets attributable to Unitholders . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . .

848,331 (32,802) 815,529 2,266 145,521 963,316 1,060,414 0.91

Units in issue (000) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Net assets attributable to Unitholders per unit (S$) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

10.

Units in issue
000

Creation of new units arising from: the Cornerstone Units (subject to the over-allotment option) . . . . . . . . . . . . . . . . . . . . . . the Offering . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

414,945 645,469 1,060,414

The Cornerstone Units will vary as is more fully described in the Prospectus. Each unit in LMIR Trust represents an undivided interest in LMIR Trust. The key rights of Unitholders are contained in the Trust Deed and include the rights to: receive income and other distributions attributable to the Units held; receive audited financial statements and the annual reports of LMIR Trust; and participate in the termination of LMIR Trust by receiving a share of all net cash proceeds derived from the realisation of the assets of LMIR Trust less any liabilities, in accordance with their proportionate interests in LMIR Trust. No Unitholder has a right to require that any assets of LMIR Trust be transferred to him.
B-19

Appendix B Further, Unitholders cannot give directions to the Trustee or the Manager (whether at a meeting of Unitholders duly convened and held in accordance with the provisions of the Trust Deed or otherwise) if it would require the Trustee or the Manager to do or omit doing anything which may result in: LMIR Trust ceasing to comply with applicable laws and regulations; or The exercise of any discretion expressly conferred on the Trustee or the Manager by the Trust Deed or the determination of any matter which, under the Trust Deed, requires the agreement of either or both of the Trustee and the Manager. The Trust Deed contains provisions that are designed to limit the liability of a Unitholder to the amount paid or payable for any Unit. The provisions seek to ensure that if the Issue Price of the Units held by a Unitholder has been fully paid, no such Unitholder, by reason alone of being a Unitholder, will be personally liable to indemnify the Trustee or any creditor of LMIR Trust in the event that the liabilities of LMIR Trust exceeds its assets. Under the Trust Deed, every Unit carries the same voting rights. 11. Unit issue costs
S$000

Unit issue costs comprise the following: Professional and other fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Underwriting, selling and management commission . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Miscellaneous issue expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

10,660 17,773 4,369 32,802

12.

Operating lease income commitments

S$000

Not later than one year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Later than one year and not later than five years . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Later than five years . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

69,132 258,092 143,234

Operating lease income commitments are for committed rentals receivable for the Retail Malls and Retail Spaces. The lease term varies from less than 1 year to 27 years. Certain lease rental terms are subject to an escalation clause but the amount of the rent increase is not to exceed a certain percentage. Other than those disclose below, such increases are not included in the above amounts. On 18 October 2007, each of the Retail Space Property Companies (as landlord) and the Master Lessee (as tenant) entered into a Master Lease Agreement, pursuant to which the Retail Spaces were leased to the Master Lessee in accordance with the terms and conditions of the Master Lease Agreements. The term of each of the Master Lease Agreements is for 10 years with an option for the Master Lessee to renew for a further term of 10 years based on substantially the same terms and conditions, except for renewal rent. The renewal rent for the further term shall be at the then prevailing market rent, as may be agreed by the relevant landlord and the Master Lessee in good faith. If there is no agreement by the relevant landlord and the Master Lessee on such prevailing market rent, the relevant landlord and the Master Lessee may refer the determination of the prevailing market rent to an independent property valuer or valuers. The renewal lease must be made by written request to the relevant landlord 12 months before the expiry of the lease term. Under each of the Master Lease Agreements, the relevant Retail Space Property Companies will be entitled to receive from the Master Lessee rental payments comprising a fixed base rent from Listing Date to 31 December 2007, an annual increment of 8.0% over the lease rental payable for the immediately preceding financial year for each of the financial years ending on 31 December 2008 to 31 December 2011 and, for each of the financial years ending on 31 December 2012 to 2016, an amount equivalent to the lease rental payable in respect of financial year ending 31 December 2011 and 4.25% of the amount by which the net revenue of the Master Lessee derived from the retail spaces for the immediately preceding
B-20

Appendix B financial year exceeds the net revenue of the Master Lessee derived from the retail spaces for the financial year ending 31 December 2010. Operating lease income commitments attributable to the Master Lessees net sales turnover are not included in the above amounts. 13. Capital commitments Estimated amounts committed at the balance sheet date for future capital expenditure on the Properties but not recognised in Pro Forma Consolidated Balance Sheet are as follows:
S$000

Authorised but not contracted for . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14. (a) Managers Management Fee, Property Managers Fee and Trustee Fee Managers Management Fee

2,257

Under the trust deed, the Manager is entitled to the following management fees: (i) (in respect of authorised investments which are in the form of real estate whether held directly by LMIR Trust or indirectly through one or more special purpose vehicles) a base fee of 0.25% per annum of the value of the deposited property and a Performance Fee of 4.0% per annum of the Net Property Income (NPI) in the relevant financial year (calculated before accounting for Performance Fee in that financial year); and (in respect of authorised investments which are not in the form of real estate whether held directly by LMIR Trust or indirectly through one or more special purpose vehicles) an authorised investment management fee of 0.5% per annum of the value of such authorised investments which, unless such authorised investment is an interest in a property fund (either a real estate investment trust or private property fund), wholly managed by a wholly-owned subsidiary of the Sponsor in which case no authorised investment management fee shall be payable in relation to such authorised investment.

(ii)

The Manager is also entitled to: (i) (for any authorised investment acquired directly or indirectly from time to time by the Trustee on behalf of LMIR Trust) an acquisition fee of 1.0% of the purchase price in the case of any authorised investment acquired by LMIR Trust. No acquisition fee is payable for the acquisition of the initial property portfolio of LMIR Trust. (ii) a divestment fee of 0.5% of the sale price (after deducting the interest of any co-owners or coparticipants) of any authorised investment sold directly or indirectly or divested from time to time by the Trustee on behalf of LMIR Trust.

The Manager is 40.0% owned by Mapletree Capital Management Pte Ltd and 60.0% owned by Peninsula Investment Ltd. Peninsula Investment Ltd is in turn 100.0% owned by Jesselton Investment Ltd, a whollyowned subsidiary of the Sponsor. (b) Trustees Fee

Under the trust deed, the maximum fee payable to the Trustee is 0.03% per annum of the value of the deposited property, subject to a minimum of S$15,000 per month, excluding out of pocket expenses and GST. The Trustees fee will be subject to review three years from the Listing Date. In addition, LMIR Trust will also pay the Trustee a one-time inception fee of S$25,000. (c) Property Managers fee

Under each existing property management agreement, the property manager is entitled to the following fees in respect of each Retail Mall under its management: 2.0% per annum of the gross revenue for the relevant Retail Mall;
B-21

Appendix B 2.0% per annum of the net property income for the relevant Retail Mall (after accounting for the fee of 2.0% per annum of the gross revenue for the relevant Retail Mall); and 0.5% per annum of the net property income for the relevant Retail Mall in lieu of leasing commissions otherwise payable to the Property Manager and / or third party agents. Under each existing property management agreement, each of the Retail Mall Property Companies agrees to reimburse the property manager, upon request made from time to time, for its expenses incurred in connection with the provision of property management services and with the performance of its duties which are in compliance with the approved annual business plan and budget as stated in the existing property management agreement. Such expenses include but are not limited to rent, service charge and VAT payable by the property manager for its lease of its office premises; advertising and promotion costs; and salaries of the property managers employees who are approved by the relevant Retail Mall Property Companies. The Property Manager is a wholly-owned subsidiary of the Sponsor. 15. (a) Other matters Right of First Refusal (ROFR)

On 14 August 2007, an agreement was entered into between the Trustee and the Sponsor pursuant to which the Sponsor granted LMIR Trust, for so long as (a) Lippo-Mapletree Indonesia Retail Trust Management Ltd remains the manager of LMIR Trust; and (b) the Sponsor and/or any of its related corporations, alone or in aggregate, remains a controlling shareholder of the Manager; a right of first refusal (the ROFR) over any retail properties located in Indonesia (each such property to be known as a Relevant Asset): (i) which the Sponsor or any of its subsidiaries (each a Sponsor Entity) proposes to sell or transfer (whether such Relevant Asset is wholly-owned or partly-owned by the Sponsor Entity and excluding any sale of Relevant Asset by a Sponsor Entity to any related corporation of such Sponsor Entity pursuant to a reconstruction, amalgamation, restructuring, merger or any analogous event) to an unrelated third party; or (ii) for which a proposed offer for sale or transfer of such Relevant Asset has been made to a Sponsor Entity. As at the Listing Date, the scope of the ROFR encompasses five properties currently under development by the Sponsor and / or its subsidiaries as set out below:
ROFR Properties under development Location

Binjai Supermall . . . . Pejaten Mall . . . . . . . Kuta Beach Mall . . . . Kemang City Mall . . . Puri Paragon City . . (b)

.. .. .. .. ..

.. .. .. .. ..

.. .. .. .. ..

.. .. .. .. ..

.. .. .. .. ..

.. .. .. .. ..

. . . . .

.. .. .. .. ..

.. .. .. .. ..

.. .. .. .. ..

.. .. .. .. ..

.. .. .. .. ..

.. .. .. .. ..

. . . . .

.. .. .. .. ..

.. .. .. .. ..

.. .. .. .. ..

.. .. .. .. ..

.. .. .. .. ..

.. .. .. .. ..

.. .. .. .. ..

. . . . .

.. .. .. .. ..

.. .. .. .. ..

.. .. .. .. ..

.. .. .. .. ..

North Sumatra South Jakarta Kuta, Bali South Jakarta West Jakarta

Memorandum of Understanding for Potential Acquisitions

On 21 May 2007, the Manager entered into a non-binding memorandum of understanding with PT Multi Pratama Gemilang Perkasa (Pikko Group) with regard to the potential acquisition by LMIR Trust of Cosmopolitan Mall Pluit, a retail mall located in North Jakarta. The Manager understands that Cosmopolitan Mall Pluit is currently undergoing asset enhancement works, with such works scheduled for completion in the second half of 2008. On 22 June 2007, the Manager entered into a non-binding memorandum of understanding with Zellwager Enterprise Limited with regard to the potential acquisition by LMIR Trust of Sun Plaza, a retail mall located in Medan, North Sumatra. The estimated acquisition price is to be negotiated and agreed in good faith between the parties, provided that such acquisition price shall not be more than the appraised value of Sun Plaza as determined by an independent property valuer to be appointed by the Trustee before the signing of the conditional sale and purchase agreement. On 26 June 2007, the Manager entered into a non-binding memorandum of understanding with PT. Pakuwon Permai in respect of the potential acquisition by LMIR Trust of Supermal Pakuwon Indah and Pakuwon Trade Center, a retail mall located in West Surabaya, East Java. The estimated acquisition
B-22

Appendix B price is to be negotiated and agreed in good faith between the parties, provided that such acquisition price shall not be more than the appraised value of Supermal Pakuwon Indah and Pakuwon Trade Center as determined by an independent property valuer to be appointed by the Trustee and the appraised value is agreed by the Vendor before the signing of the conditional sale and purchase agreement. (c) Rental Guarantee Deeds

On 10 August 2007, Lippo Strategic Holdings Inc (Lippo Strategic) entered into a Rental Guarantee Deed with each of the Retail Mall Investment Holding Companies pursuant to which Lippo Strategic will provide a rental guarantee to the relevant Retail Mall Investment Holding Companies in respect of existing and new units in the respective retail malls which are untenanted and undertake to pay to the relevant Retail Mall Investment Holding Companies any shortfall in the maintenance and operation costs which the relevant Operating Company has undertaken to bear under the respective Operating Costs Agreement. The Rental Guarantee Deeds cover the period commencing from the Listing Date up to 31 December 2009. Pursuant to the Rental Guarantee Deeds, Lippo Strategic is obliged to pay to the Retail Mall Investment Holding Companies a specified sum in respect of each Retail Mall for every year during the said period. The first of such payment will be paid on or before 31 January 2008, and subsequent payments will be made on a quarterly basis thereafter. In the event any of the specified units in the relevant Retail Mall becomes tenanted during such period, the amount of the specified sum payable by Lippo Strategic in respect of such Retail Mall will be reduced by the amount of the rental payable under the relevant tenancy, regardless of whether such rental is received by the owner of the relevant Retail Mall and notwithstanding that such tenancy may be or is terminated prior to the expiry of such period. To secure Lippo Strategics performance under each of the Rental Guarantee Deeds, Lippo Strategic is required to furnish to the Retail Mall Investment Holding Companies bank guarantees. The aggregate amount of all the bank guarantees to be furnished under the Rental Guarantee Deeds is S$10.0 million. (d) Retail Malls Operating Costs Agreements

Pursuant to each of the Operating Costs Agreements to be entered into between the relevant Retail Mall Property Companies and Operating Company, the relevant Operating Company will agree to unconditionally bear, for a period of three years commencing 1 January 2007, all costs directly related to the maintenance and operation of the relevant Retail Mall. In consideration of its agreements under the relevant Operating Costs Agreement, the relevant Operating Company has the right to collect, through the property manager, a service charge and statutory income from the tenants of that Retail Mall. This service charge is intended to cover the costs directly related to the maintenance and operation of the Retail Mall. The amount of the service charge will be recommended by the property manager as a result of its review of the prevailing market rates. The statutory income is intended to cover the costs directly related to the provision of utilities to the retail mall. The right to collect the service charge and statutory income shall be in accordance with the lease agreements entered into by and between the Retail Malls Property Companies and the respective tenants of the Retail Mall and such collection shall be coordinated by the property manager. The operating costs agreements will lapse on 31 December 2009 and LMIR Trust will bear all costs directly related to the maintenance and operation of the Retail Malls thereafter. (e) Build Operate and Transfer (BOT) Agreements

The Pro Forma Group has the following BOT agreements for the following Retail Malls: 1. Cibubur Junction

PT Cibubur Utama (PT Cibubur) entered into a BOT agreement with Perusahaan Daerah Pembangunan Sarana Jaya DKI Jakarta (Sarana). PT Cibubur has the right to build operate and transfer the property for a period of 20 years commencing July 2005 and the first priority to extend the agreement. To obtain the extension, PT Cibubur must give at least 3 months prior written notice to Sarana and that PT Cibubur has met all obligations under the BOT agreement.
B-23

Appendix B PT Cibubur has the following payment obligations to Sarana: (a) (b) Rp. 9,500,000,000 (S$1,610,200) including VAT in 8 installments from 9 June 2003 to 15 December 2003. US$2,260,000 (S$3,473,600) including VAT, that is to be paid by installments from the year 2004 until 2024 as follows: (i) US$ 75,500 (S$116,000) per year for the first 5 years. (ii) US$100,500 (S$154,500) per year for the second 5 years. (iii) US$125,500 (S$192,900) per year for the third 5 years. (iv) US$150,500 (S$231,300) per year for fourth 5 years. The pegged rate of payment shall be US$1 equal to Rp. 8,500. (c) (d) Goodwill cooperation of Rp. 100,000,000 (S$17,000) (including VAT) on 20 December 2004. Goodwill compensation of Rp. 1,500,000,000 (S$254,000) that is to be paid (i) Rp. 500,000,000 (S$84,700) shall be paid on 20 December 2004 and (ii) Rp. 1,000,000,000 (S$169,500) shall be paid from 2005 until 2009 in 5 installments of Rp. 200,000,000 (S$33,900) per year with the first installment commencing 1 February 2005. Monitoring fee of Rp. 5,000,000 (S$847) per month including VAT that is to be paid quarterly on 15 January, 15 April, 15 July and 15 October commencing 2004. Plaza Semanggi

(e) 2.

PT Primatama Nusa Indah (PT Primatama) entered into a BOTagreement with Yayasan Gedung Veteran Republik Indonesia (Yayasan Veteran). PT Primatama has the right to build operate and transfer the property for a period of 30 years commencing July 2004. The BOT Agreement can be extended automatically for another 20 years under the same terms and conditions of the current lease with at least 6 months prior written notice, and to such notice, Yayasan Veteran automatically grants its approval for the extension. PT Primatama shall pay to Yayasan Veteran annually 5% of its gross income from the lease of premises and parking spaces (excluding taxes) of each year, commencing from the date of commencement of operations to the 15th year. From the 16th year, PT Primatama shall pay Yayasan Veteran 10% of its gross income from the lease of premises and parking spaces (excluding taxes) for each year. 3. Ekalokasari Plaza

PT Indah Pesona Bogor (PT Indah) entered into a BOT amendment agreement with PT Bogor Life Science and Technology (BLST) representing Institute Pertanian Bogor (Institute Pertanian). PT Indah has the right to build operate and transfer the property for a period of 31 years up to 2032. PT Indah shall pay BLST Rp. 12,000,000,000 (S$2,034,000) (excluding tax) comprising: (i) Rp. 4,000,000,000 (S$678,000) (excluding tax) for the utilisation of land; (ii) Rp. 500,000,000 (S$84,700) (excluding tax) for the additional compensation for the utilisation of land; (iii) Rp. 960,000,000 (S$162,700) (excluding tax) that will be paid for the extension of the validity of the BOT agreement; (iv) Rp. 6,290,000,000 (S$1,066,100) (excluding tax) for early payment of kiosk / tenancy rental income profit sharing which was previously of 15% of PT Indahs kiosk / tenancy rental income; (v) Rp. 250,000,000 (S$42,400) (excluding tax) for early payment of shopping centre operational net income profit sharing, which previously as 50% of PT Indahs shopping centre net income. PT Indah has paid Rp. 4,000,000,000 (S$678,000) for the utilisation of land and has the remaining amount of Rp. 8,000,000,000 (S$1,356,000) which is to be paid in 4 installments from June 2007 to September 2007. PT Indah can extend the term of the agreement with 6 months prior written application.
B-24

Appendix B 4. Bandung Indah Plaza

PT Megah Semesta Abadi (PT Megah) entered into a BOT agreement with Perusahaan Daerah (PD) Jasa dan Kepariwisataan Jawa Barat (previously known as PD Kerta Wisata Jawa Barat) (PDJK). PT Megah has been granted the right to build operate and transfer the property up to 31 December 2030. If PDJK does not intend to manage the building and facilities, PDJK will give first option to PT Megah to become a partner of PDJK under a new agreement. PDJK must notify the PT Megah on whether or not it has the intention to operate the building and facilities. This notification must be provided at least 6 months prior to expiration of the BOT Agreement. BOT agreement cannot be assigned without prior approval. PT Megah has the following obligations to PDJK: a. Revenue sharing for Shopping Centre I for the period from 19 August 1992 to 31 December 2030 will be at 2% of the rental income of shops and retail per year and shall increase 0.25% every 4 years. The increase will commence as of May 2008; Revenue sharing for Shopping Centre II for the period from 1 May 1994 to 31 December 2030 will be at 2 % of rental income of shops and retails per year and shall increase 0.25% every 4 years. The increase will commence on May 2008; 5% of net operational profits, commencing August 1995; 5% of net income from rental of open areas, promotional spaces and corridors commencing August 2005; Profit sharing with respect to parking spaces from August 2005 at 40% of parking net income after deducting contribution to Parking Management Institution (Badan Pengelola PerparkiranBPP) and other expenses, VAT of 10%, interest expense, depreciation of parking facility, with maximum threshold of the expenses is 76% of rental income, provided that if the VAT no longer prevails or the government changes the figure of the VAT then the percentage of expenses will be mutually agreed by both parties; Both PT Megah and PDJK will share the net rental revenue of the cinema up to August 2020 based on 50% ratio each. Profit share after 2020 will be determined later; The revenue sharing for commercial space will be in the amount of 2% of the rental income of commercial space per year and shall increase 0.25% every 4 years. The increase will commence on May 2008. Istana Plaza

b.

c. d. e.

f. g.

5.

PT Suryana Istana Plaza (PT Suryana) entered into a BOT agreement with Pasundan Church. PT Suryana has the right to build operate and transfer the property for a period of 32 years from January 2002. During the BOT period, PT Suryana is prohibited from assigning the ownership or encumbering the property to another party, except to use the property as security for the repayment of loan to finance the construction of the building. No extension provision is provided in the BOT Agreement. (f) Put Option

As at the Latest Practicable Date, four of the seven retail spaces, namely Metropolis Town Square Units, Depok Town Square Units, Malang Town Square Units and Grand Palladium Medan Units, are each bound by Kiosks Sale and Purchase Binding Agreements because their strata titles are in the process of being issued by the Indonesian government. In relation to each of the Metropolis Town Square Units, Depok Town Square Units, Malang Town Square Units and Grand Palladium Medan Units, a put option agreement has been entered into between, inter alia, the Trustee and the Master Lessee, pursuant to which, in the event that the strata titles to these four retail spaces are not issued within 24 months from the Listing Date, a meeting of all the Unitholders will be convened by the Trustee pursuant to which the Unitholders will vote, by way of an ordinary resolution, on whether to retain these four retail spaces in the portfolio of LMIR Trust for a further six months from the date of the ordinary resolution. In the event that an ordinary resolution is passed in favour of retaining these four retail spaces in the portfolio of LMIR Trust and the strata titles are still not issued upon expiry of six
B-25

Appendix B months from the date of the ordinary resolution, the Trustee shall exercise the put option. In the event that an ordinary resolution is not passed in favour of retaining these four retail spaces, the Trustee shall be entitled to exercise the put option within three months of the date of the meeting of the Unitholders. Upon the Trustees exercise of the put option in relation to one of these four Retail Spaces, the Master Lessee will be required to purchase the relevant Retail Spaces at the consideration as described in Certain Agreements Relating to LMIR Trust and the PropertiesDescription of the Put Option Agreements of the Prospectus. (g) Letter of Undertaking

On 9 August 2007, the Trustee, the Manager and the Sponsor entered into a letter of undertaking, pursuant to which the Sponsor will use its best endeavours to procure that the relevant Retail Space Property Companies obtain the strata titles to the Metropolis Town Square Units, Depok Town Square Units, Malang Town Square Units and Grand Palladium Medan Units. 16. Future changes in accounting standards The following new or revised FRS that have been issued will be effective in future and may be relevant to the entity.
Effective date for periods beginning on or after

FRS No.

Title

FRS 108 Operating Segments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . INT FRS 112 Service Concessions Arrangements. . . . . . . . . . . . . . . . . . . . . . . . .

1.1.2009 1.1.2008

B-26

Appendix C
INDEPENDENT SINGAPORE TAXATION REPORT The Board of Directors Lippo-Mapletree Indonesia Retail Trust Management Ltd. as Manager of Lippo-Mapletree Indonesia Retail Trust 78 Shenton Way #05-01 Lippo Centre Singapore 079120 HSBC Institutional Trust Services (Singapore) Limited as Trustee of Lippo-Mapletree Indonesia Retail Trust 21 Collyer Quay #14-01 HSBC Building Singapore 049320 19 October 2007 Dear Sirs SINGAPORE TAXATION REPORT This letter has been prepared at the request of Lippo-Mapletree Indonesia Retail Trust Management Ltd. (the Manager) for inclusion in the Prospectus for Lippo-Mapletree Indonesia Retail Trust (LMIR Trust) dated 19 October 2007 in connection with the listing of LMIR Trust on the Singapore Exchange Securities Trading Limited. The purpose of this letter is to provide prospective purchasers of the units in LMIR Trust (Units) with an overview of the Singapore income tax consequences of the purchase, ownership and disposition of the Units. This letter principally addresses Unitholders who hold the Units as investment assets. Unitholders who hold or have acquired the Units for dealing purposes should consult their own tax advisers concerning the tax consequences of their particular situations. This letter is not a tax advice and does not attempt to describe comprehensively all of the tax considerations that may be relevant to a decision to purchase, own or dispose of the Units. Unitholders should consult their own tax advisers concerning the tax consequences of their particular situations. In particular, Unitholders who are not Singapore tax residents are advised to consult their own tax advisers to take into account the tax laws of their respective countries of residence and the existence of any tax treaty which their countries of residence may have with Singapore. This letter is based on the Singapore income tax law and the relevant interpretation thereof current at the date of this letter, all of which are subject to change, possibly with retroactive effect. Words and expressions in this letter have the same meaning as defined in the Prospectus. In addition, unless the context requires otherwise, words in the singular include the plural and the other way around and words of one gender include any gender. SINGAPORE TAXATION OF REAL ESTATE INVESTMENT TRUSTS IN GENERAL Under current Singapore income tax law, the taxable income of a trust comprises: (a) (b) income accruing in or derived from Singapore; and unless otherwise exempt, income derived from outside Singapore which is received in Singapore or deemed to have been received in Singapore by the operation of law.

The taxable income of a trust is ascertained in accordance with the provisions of the Singapore income tax law, after deduction of all allowable expenses and any other allowances permitted under the law.
C-1

Appendix C The taxable income of a trust, or part thereof, is taxed at the prevailing corporate rate of income tax and the tax is assessed on the trustee in the following circumstances: where the income is derived from any trade or business carried on by the trustee, in its capacity as the trustee of the trust; where the beneficiaries of the trust are not resident in Singapore; or where the beneficiaries are not entitled to the income of the trust. Any distribution made out of such income which has been assessed to tax on the trustee is not taxable in the hands of the beneficiaries. The tax paid by the trustee on such income is not imputed as a credit to the beneficiaries for Singapore income tax purposes. Where the taxable income of a trust is income other than that derived from any trade or business carried on by the trustee, such income may be assessed to tax directly on the beneficiaries of the trust where the beneficiaries are resident in Singapore and are entitled to the income of the trust. In a real estate investment trust, which is defined in the Income Tax Act to mean a trust constituted as a collective investment scheme authorised under section 286 of the Securities and Futures Act (Cap. 289) and listed on the Singapore Exchange, that invests or proposes to invest in immovable property and immovable property-related assets, (referred hereinafter as a REIT), the trustee may be charged at a lower rate or not charged with any tax, as the Comptroller of Income Tax (Comptroller) shall determine and subject to the satisfaction of the Comptroller. This treatment, if granted, will apply to only certain income of a REIT, including rental income or income from the management or holding of immovable property but not including gains from the disposal of immovable property (tax-transparent income). Beneficiaries of the REIT are instead assessed to tax on the share of such tax-transparent income to which each of them is beneficially entitled. The tax may be assessed directly on the beneficiaries or deducted by the trustee from the amount of distribution made to the beneficiaries, depending on their own particular circumstances. The income of a REIT that is taxable in the hands of its beneficiaries does not include income from any trade or business carried on by the trustee that is not tax-transparent income. Tax on such non taxtransparent income would have been assessed on the trustee of the REIT. Beneficiaries of the REITare not taxed on distributions made out of such non tax-transparent income. The tax paid by the trustee on such non tax-transparent income is not imputed as a credit to the beneficiaries for Singapore income tax purposes. Where the REIT derives any tax-exempt income, such income is exempt from tax in the hands of the trustee. Beneficiaries of the REIT will also be exempt from tax on the share of such tax-exempt income to which each of them is beneficially entitled. SINGAPORE TAXATION OF LMIR TRUST LMIR Trust is liable to Singapore income tax on: (a) (b) income accruing in or derived from Singapore; and unless otherwise exempt, income derived from outside Singapore which is received in Singapore or deemed to have been received in Singapore by the operation of law.

The Singapore taxation of LMIR Trust in respect of the income and gains which it may derive from the Properties is described below. Dividends from the Target Singapore SPCs LMIR Trusts income will comprise substantially dividends received from its holding of ordinary shares in the Target Singapore SPCs. Provided that the Target Singapore SPCs are tax residents of Singapore for income tax purposes, these dividends will be one-tier (tax-exempt) dividends and hence exempt from tax in the hands of the Trustee. A company is a tax resident of Singapore if the management and control of its business is exercised in Singapore.
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Appendix C Gains on disposal of shares Singapore does not impose tax on capital gains. In the event that LMIR Trust disposes of its ordinary shares or redeemable preference shares or both in the Target Singapore SPCs, gains arising from such a disposal will not be liable to Singapore income tax unless the gains are considered income of a trade or business. The gains may also be liable to Singapore income tax if the shares were acquired with the intention or purpose of making a profit by sale and not for long-term investment purposes. Gains arising from the sale of the ordinary shares or redeemable preference shares or both in the Target Singapore SPCs, if considered to be trading gains, will be taxable on the Trustee. Redemption of redeemable preference shares in the Target Singapore SPCs Any proceeds received by LMIR Trust from the redemption of its redeemable preference shares in the Target Singapore SPCs at the original cost of the redeemable preference shares are capital receipts and hence not taxable on the Trustee. Other income In the event that LMIR Trust derives other income that is liable to Singapore income tax, for example interest from the deposit of surplus cash with banks, the tax on such income will be assessed on the Trustee at the prevailing corporate tax rate. Taxation of the Singapore SPCs The Singapore SPCs are liable to Singapore income tax on: (a) (b) income accruing in or derived from Singapore; and unless otherwise exempt, income derived from outside Singapore which is received in Singapore or deemed to have been received in Singapore by the operation of law.

The income of the Singapore SPCs will comprise substantially dividends derived from their holdings of ordinary shares in the relevant Indonesian SPCs or interest derived from shareholders loans extended to the relevant Indonesian SPCs or both. Dividends from the Indonesian SPCs Provided that the Singapore SPCs are tax residents of Singapore for income tax purposes, any dividends received in Singapore by the Singapore SPCs from the Indonesian SPCs will be exempt from Singapore income tax under Section 13(8) of the Income Tax Act, if the following conditions are met: (a) (b) (c) in the year the dividends are received in Singapore, the headline corporate tax rate in Indonesia is at least 15.0%; the dividends have been subject to tax in Indonesia; and the Comptroller is satisfied that the tax exemption would be beneficial to the Singapore SPCs.

Based on the current tax laws in Indonesia, dividends paid by the Indonesian SPCs out of their income from the letting of the Properties will meet the aforesaid conditions (see Indonesian Tax Implications). Interest from the Indonesian SPCs LMIR Trust has obtained approval of the IRAS to exempt the interest received by the relevant Singapore SPCs on the loans extended to the Indonesian SPCs from Singapore income tax under Section 13(12) of the Income Tax Act. This approval is subject to the relevant Singapore SPCs satisfying certain stipulated conditions, including the condition that the full amount of the remitted interest, less attributable expenses, must be distributed to LMIR Trust. Gains on disposals of shares Singapore does not impose tax on capital gains. In the event that the Singapore SPCs dispose of their ordinary shares in the Indonesian SPCs, gains arising from such a disposal will not be liable to Singapore income tax unless the gains are considered income of a trade or business. The gains may also be liable to Singapore income tax if the shares were acquired with the intention or purpose of making a profit by sale and not for long-term investment purposes.
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Appendix C Gains arising from the sale of ordinary shares in the Indonesian SPCs, if considered to be trading gains, will be assessed to tax on the Singapore SPCs. Repayment of loans by the Indonesian SPCs Any proceeds received by the Singapore SPCs from repayment of principal on the loans by the Indonesian SPCs are capital receipts and hence not taxable on the Singapore SPCs. SINGAPORE TAXATION OF UNITHOLDERS Distributions by LMIR Trust Subject to LMIR Trusts distribution policy (see Distributions), LMIR Trusts distributions will mainly be made out of the following receipts: (a) (b) one-tier (tax-exempt) dividends received from the Target Singapore SPCs (the tax-exempt income); and capital receipts from the redemption of redeemable preference shares in the Target Singapore SPCs.

Distributions out of tax-exempt income Unitholders will be exempt from Singapore income tax on distributions made out of LMIR Trusts taxexempt income. For this purpose, the amount of tax-exempt income distributions that LMIR Trust can distribute for a distribution period will be to the extent of the amount of tax-exempt income that it has received and is entitled to receive in that distribution period. Distributions made out of any amount of Distributable Income for a distribution period which LMIR Trust received or is entitled to receive as its own tax-exempt income after the end of that distribution period will be treated as capital distributions and the tax treatment set out under Distributions out of capital receipts will apply. The amount of such tax-exempt income may be used to frank tax-exempt income distributions out of Distributable Income for subsequent distribution periods. Distributions out of capital receipts Unitholders will not be subject to Singapore income tax on distributions made by LMIR Trust out of its capital receipts, i.e. amounts received from the redemption of redeemable preference shares in the Target Singapore SPCs. Such distributions will be treated as returns of capital for Singapore income tax purposes. For Unitholders who hold the Units as trading or business assets and are liable to Singapore income tax on gains arising from disposal of the Units, the amount of such distributions will be applied to reduce the cost of the Units for the purpose of calculating the amount of taxable trading gain when the Units are disposed of. If the amount exceeds the cost or the reduced cost of the Units, as the case may be, the excess will be subject to tax as trading income of such Unitholders. Distributions out of taxable trading gains or taxable income Unitholders are not subject to further Singapore income tax on distributions made by LMIR Trust out of its taxable trading gains, for example, gains arising from the disposal of shares in the Target Singapore SPCs which are determined to be trading gains, or other taxable income. The tax on such gains or income will be assessed on the Trustee at the prevailing corporate tax rate and any distribution made out of such gains or income is not taxed in the hands of Unitholders. The tax paid by the Trustee on such gains or income is not imputed as a credit to Unitholders for Singapore income tax purposes. Distributions out of capital gains Unitholders are not subject to Singapore income tax on distributions made by LMIR Trust out of capital gains, for example, gains arising from the disposal of shares in the Target Singapore SPCs which are determined to be capital in nature, unless the distributions are considered gains or profits of a trade or business carried on by the Unitholder, for example, if the Units are held as trading assets.
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Appendix C Disposal of Units Singapore does not impose tax on capital gains. Therefore, gains on disposal of the Units that are capital in nature will not be subject to tax. However, such gains may be considered income in nature and subject to Singapore income tax if they arise from or are otherwise connected with the activities of a trade or business carried on in Singapore. Such gains may also be considered income in nature, even if they do not arise from an activity in the ordinary course of trade or business or an ordinary incident of some other business activity, if the Units were purchased with the intention or purpose of making a profit by sale and not with the intention to be held for long-term investment purposes. If a Unitholder has held the Units for long-term investment purposes, any gains arising from sale of the Units should be considered capital gains and hence not subject to Singapore income tax. However, if the Units have been held as trading assets of a trade or business carried on in Singapore, the gains arising from the sale will be taxed as income. The precise tax status of one Unitholder will vary from another. Because of this, Unitholders are advised to consult their own professional advisers on the Singapore tax consequences that may apply to their individual circumstances. Yours faithfully

Ernst & Young Singapore Lim Gek Khim Tax Partner

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Appendix D
INDEPENDENT INDONESIAN TAXATION REPORT

Jakarta, 19 October 2007

78 Shenton Way #05-01 Lippo Centre Singapore 079120

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Appendix D

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Appendix D

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Appendix E
INDEPENDENT PROPERTY VALUATION SUMMARY REPORTS

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Appendix E

Report No.017/WPA-Report/2007 30 June 2007

PT. Willson Properti Advisindo Wisma Nugra Santana #17-03 Jl. Jend. Sudirman Kav. 7-8 Jakarta 10220, Indonesia +62 (21) 570 7170 +62 (21) 570 7177 fax www.knightfrank.com

To: Lippo-Mapletree Indonesia Retail Trust Management (as Manager of Lippo-Mapletree Indonesia Retail Trust) One Phillip Street #15-00 Singapore 048692 and HSBC Institutional Trust Services (Singapore) Limited (as Trustee of Lippo-Mapletree Indonesia Retail Trust) 21 Collyer Quay #14-01 HSBC Building Singapore 049320 Dear Sirs, RE: VALUATION OF SHOPPING CENTERS: 1. THE PLAZA SEMANGGI, JAKARTAINDONESIA. 2. GAJAH MADA PLAZA, JAKARTAINDONESIA. 3. CIBUBUR JUNCTION, JAKARTAINDONESIA. 4. BANDUNG INDAH PLAZA, BANDUNGINDONESIA. 5. ISTANA PLAZA, BANDUNGINDONESIA. 6. EKALOKASARI PLAZA, BOGORINDONESIA. 7. MAL LIPPO CIKARANG, BEKASIINDONESIA. VALUATION OF RETAIL SPACES TENANTED AND OPERATED BY MATAHARI GROUP AT: 1. DEPOK TOWN SQUARE, DEPOKINDONESIA. 2. MALL WTC MATAHARI, TANGERANGINDONESIA. 3. METROPOLIS TOWN SQUARE, TANGERANGINDONESIA. 4. JAVA SUPERMALL, SEMARANGINDONESIA. 5. PLAZA MADIUN, MADIUNINDONESIA. 6. MALANG TOWN SQUARE, MALANGINDONESIA. 7. GRAND PALLADIUM, MEDANINDONESIA. Instructions This valuation summary report has been prepared for the purposes of inclusion in the prospectus to be issued in relation to the initial public offering of units in the Lippo-Mapletree Indonesia Retail Trust, which will be listed on the Singapore Exchange Securities Trading Limited.

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Appendix E

Report No.017/WPA-Report/2007 Page 2. In accordance with your instructions for Knight Frank/PT. Willson Properti Advisindo to conduct formal fixed asset valuation of the above-captioned properties (the Properties) in providing our opinion of Market Value of the Properties as at 30 June 2007; subject to the existing and proposed leases, occupancy and operational arrangements of the shopping centers, and subject to the proposed lease arrangements of the retail outlet stores with PT. Matahari Putra Prima Tbk as stipulated in the proposed Lease Agreements (the Valuation). We are pleased to confirm that we have completed our site inspection, due diligence, and Valuation of the Properties; and have prepared fourteen formal comprehensive valuation reports for each of the Properties (the Reports). No structural survey has been made, but in the course of our inspection, we did not note any serious defect. We are not, however, able to report that the Properties are free from rot, infestation or any other structural defect. No tests were carried out to any of the services. Our Valuation expresses our opinion of Market Value, which is defined in the International Valuation Standards (IVS) 2003 and the Indonesian Valuation Standards (Standar Penilaian Indonesia/SPI) 2002 to mean the estimated amount for which an asset should exchange on the date of valuation between a willing buyer and a willing seller in an arms length transaction after proper marketing wherein the parties had each acted knowledgeably, prudently and without compulsion. We have prepared and provided this summary of the Reports outlining key factors that have been considered in arriving at our opinion of Market Value, which reflects all information known by us and based on current market conditions. RELIANCE ON THIS LETTER This valuation summary report does not contain all the necessary data and support information included in our Reports. For further information to that contained herein, reference should be made to the Reports, copies of which are held by the Manager and which we understand will be available for inspection for a period of six months from the date of the Prospectus. The Valuation and market information contained in the Reports are not guarantees or predictions and must be read in consideration of the followings: Each report is several pages in length and the conclusion as to the value assessment is based upon the factual information set forth in that Report. Whilst Knight Frank/PT. Willson Properti Advisindo has endeavored to assure the accuracy of the factual information, it has not independently verified all information provided by the Manager (primarily the existing leases and the Master Lease Agreements and other information relating to the Properties) or the Government of the Republic of Indonesia (primarily statistical information relating to market conditions). Knight Frank/PT. Willson Properti Advisindo believes that every investor, before making an investment in Lippo-Mapletree Indonesia Retail Trust, should review the Reports to understand the complexity of the methodology and the many variables involved.

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Appendix E

Report No.017/WPA-Report/2007 Page 3. The methodologies used by Knight Frank/PT. Willson Properti Advisindo in valuing the Propertiesthe Income Method utilizing Discounted Cash Flow Analysis and Income Capitalizationare based upon assessment of future results and are not predictions. These valuation methodologies are summarized in the Valuation Rationale section of this summary report. Each methodology is based on a set of assumptions as to income and expenses of the relevant Property and future economic conditions in the local market. The income and expenses figures are mathematically extended with the adjustments for anticipated changes in economic conditions. The resultant value is considered the best practice assessment but is not to be construed as a prediction or guarantee and is fully dependent upon the accuracy of the assumptions as to income, expenses and market conditions. The Reports were undertaken based upon information available as at 30 June 2007. Knight Frank/ PT. Willson Properti Advisindo accepts no responsibility for subsequent changes in information as to income, expenses or market conditions. We have also relied on the information provided by the owning companies of the Properties on matters such as the ownership title particulars, the terms and conditions of BOT (Build, Operate, and Transfer) arrangements and leasehold tenure, details, land areas, building floor areas, building facilities and services, tenancy list, renovation and/or expansion plans, etc. All information provided to us is treated as correct and we accept no responsibility for subsequent changes in information and reserve the right to change our opinion of value if any other information provided were to materially change.

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Appendix E

Report No.017/WPA-Report/2007 Page 4. SUMMARY OF THE PROPERTIES Shopping Centers: 1. The Plaza Semanggi Brief Description The Plaza Semanggi is a shopping-cum-office complex, which comprises The Plaza Semanggi 7-storey and 2-basement level shopping center, and Gedung Veterana 13-storey office building. The Plaza Semanggi is built adjacent to and on the same site with Balai Sarbini, a convention hall, which is excluded in this Valuation. The Plaza Semanggi has a total existing lettable retail floor area of about 46,724 square meters. In addition, a proposed 3,000-square meter dining-cum-entertainment facility, designated as Plangi on the Sky, will be built above the parking floor and is scheduled for completion and operation by the middle of 2007. The Plaza Semanggi offers a wide range of shopping, dining, and leisure activities. The building accommodates a supermarket, a department store, retail units, restaurants, cafes, food outlets, food court, home furnishing stores, a fitness center, a karaoke lounge, a book store, an electronic mega store, hand phone and computer stores, a Cineplex, and a billiard. The building is built with 2 basement levels and 7 parking floors on 5th to 9th levels to accommodate a total of 1,100 car parking capacity. Major tenants include Centro Department Store, Giant Superstore, Electronic Solution, Fitness First, Gramedia Book Store, and 21 Cineplex. Gedung Veteran is a B-grade office building with a total lettable office floor area of about 11,961 square meters (including a 970-square meter rent-free office space entitled to the land owner). Major tenants include MAA Insurance and X Lounge. Particulars Address : Jalan Jenderal Sudirman Kav. 50, Sub-District of Karet Semanggi, District of Setiabudi, Regency of South Jakarta, JakartaIndonesia. 19,000 square meters. Yayasan Gedung Veteran Republik Indonesia CQ the Secretary General of the Republic of Indonesia. Hak Pakai (Right to Use) No. 133/Karet Semanggi dated 21 October 1997. - Perjanjian Pengikatan Revitalisasi, Pengelolaan dan Pengalihan (Introductory Agreement of Revitalization, Management and Transfer) dated 5 January 2000. - Perjanjian Revitalisasi, Pembangunan, Pengolahan dan Pengalihan (Deed of Revitalization, Development, Management and Transfer) No. 56 dated 29 March 2000.

Land Area Land Owner Land Title BOT Agreement

: : : :

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Appendix E

Report No.017/WPA-Report/2007 Page 5. - Addendum Perjanjian Revitalisasi, Pembangunan, Pengolahan dan Pengalihan (Deed of Addendum for the Deed of Revitalization, Development, Management and Transfer) Nos. 25 and 26 dated 26 May 2000. - Addendum Perjanjian Revitalisasi, Pembangunan, Pengolahan dan Pengalihan (Deed of Addendum for the Deed of Revitalization, Development, Management and Transfer) dated 29 January 2002. BOT Right Holder BOT Term : : PT. Primatama Nusa Indah. - Initial term of 30 (thirty) years from 8 July 2004 to 8 July 2034. - Extension term of 20 (twenty) years from 8 July 2034 to 8 July 2054. In total, a remaining BOT term of 47.05 years from the date of valuation. Land Zoning Type of Development No. of Building Block Building Level : : : : Commercial use. Shopping center and office building. 2 blocks. - Shopping center (7 floors and 2 basement levels). - Office Building (13 floors, including Level 11, the rent-free office floor entitled to the land owner) - Parking (7 floors starting from level 5) Initial Opening Year Gross Floor Area Lettable Floor Area : : : 2004. 91,232 square meters. - Retail spaces of The Plaza Semanggi - Office spaces of Gedung Veteran (including Level 11, a 970-square meter rent-free office floor entitled to the land owner). Current Total - Plangi on the Sky, a proposed dining-cum-entertainment facility scheduled for completion and operation by middle of 2007). Future Total Occupancy Level : 96.4%, based on current total lettable floor area of 58,685 square meters. : 46,724 square meters. : 11,961 square meters

: 58,685 square meters. : 3,000 square meters.

: 61,685 square meters.

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Appendix E

Report No.017/WPA-Report/2007 Page 6. Tenancy Details : As at 30 June 2007, anchor and major tenants occupied about 53.6% of the total occupied retail space within the shopping center. Centro Department Store is the largest tenant which constituted about 17.2% of the total occupied retail space, Giant Superstore is the second largest tenant by 13.7%, Electronic Solution is the third largest tenant by 9.3%, Fitness First is the fourth largest tenant by 4.6%, Gramedia is the fifth largest tenant by 3.5%, 21 Cineplex is the sixth largest by 3.1%, and the remaining 2.2% goes to Gillians Billiard. Centro Department Store has a 10-year lease term expiring in 4 November 2013, Giant has a 12-year lease term expiring in 14 February 2019, Electronic Solution and 21 Cineplex have 5-year lease term expiring in 2011 and 2014, Fitness First has a 15-year lease term expiring in 2020, whilst Gillians Billiard, and Gramedia have 5-year lease terms expiring in 2009, 2010 respectively. About 44.4% of the specialty shops including food outlets have a 5-year lease term, about 22.3% have a 30-year lease term, about 10.8% have a 3-year lease term, about 15.9.2% have a 10-year lease term, and the remaining 6.6% have variable lease terms. The shopping center has an overall average base rental rate of about Rp. 92,598/square meter/month. The average base rental rate for the anchor and major tenants, Ground Floor, Upper Ground Floor, 1st Floor, 2nd Floor, 3rd Floor, 3A Floor (food court and restaurant level) respectively are about Rp. 58,402, Rp. 174,200, Rp. 256,176, Rp. 220,151, Rp. 101,055, Rp. 79,896, Rp. 425,581/square meter/month. As at 30 June 2007, MAA Assurance was the largest tenant in the office building occupying about 17.18% of the total occupied spaces, and X Lounge was the second largest tenant by about 17.22%. About 46% of the existing tenants in the office building have a 5-year lease term expiring in 2009 and 2010, about 24.2% have a 3-year lease term expiring in 2008, about 18.2% have a 2-year lease term expiring in 2007, and the remaining 11.6% are under a 30-year lease term expiring in 2034. The office building has an average base rental rate of about Rp. 42,388/square meter/month. The base rental rate for its typical floor is about Rp. 34,120/square meter/month, and for its ground floor is about Rp. 206,459/square meter/month.

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Appendix E

Report No.017/WPA-Report/2007 Page 7. 2. Gajah Mada Plaza Brief Description Gajah Mada Plaza is a 7-storey with 1 basement level shopping center with a total lettable floor area of about 34,278 square meters. It offers a wide range of shopping, dining, and leisure activities. The building accommodates a hypermarket, a department store, retail units, restaurants, food outlets, food court, pet shops, a book store, computer stores, a Cineplex, convention/wedding halls, fitness center, karaoke lounge, and a night club. Major tenants include Hypermart, Rimo Department Store, Inul Fiesta, Millenium Executive Club, Eva Bun, and GM 21 Cineplex. Gajah Mada Plaza is built adjacent to and on the same site with the 28-storey Gajah Mada Office Building. Particulars Address : Jalan Gajah Mada No. 19-26, Sub-District of Petojo Utara, District of Gambir, Regency of Central Jakarta, JakartaIndonesia. 37,501 square meters. PT. Graha Baru Raya. - Sertifikat Hak Milik Atas Satuan Rumah Susun (Freehold Unit Title in a Multi-Storey Building) No. 325/-I/S/Petojo Utara dated 26 July 1999. Unit No. SSG-01, Level SG, Block S. Unit Area: 5,228 square meters. - Sertifikat Hak Milik Atas Satuan Rumah Susun (Freehold Unit Title in a Multi-Storey Building) No. 326/-I/S/Petojo Utara dated 26 July 1999. Unit No. SSG-02, Level SG, Block S. Unit Area: 135 square meters. - Sertifikat Hak Milik Atas Satuan Rumah Susun (Freehold Unit Title in a Multi-Storey Building) No. 328/I/S/Petojo Utara dated 26 July 1999. Unit No. SG-02, Level G, Block S. Unit Area: 18 square meters. - Sertifikat Hak Milik Atas Satuan Rumah Susun (Freehold Unit Title in a Multi-Storey Building) No. 330/II/S/Petojo Utara dated 26 July 1999. Unit No. S01-02, Level 1, Block S. Unit Area: 17 square meters.

Strata Title Floor Area Strata Title Owner Strata Title

: : :

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Appendix E

Report No.017/WPA-Report/2007 Page 8. - Sertifikat Hak Milik Atas Satuan Rumah Susun (Freehold Unit Title in a Multi-Storey Building) No. 332/III/S/Petojo Utara dated 26 July 1999. Unit No. S02-02, Level 2, Block S. Unit Area: 43 square meters. - Sertifikat Hak Milik Atas Satuan Rumah Susun (Freehold Unit Title in a Multi-Storey Building) No. 333/IV/S/Petojo Utara dated 26 July 1999. Unit No. S03-02, Level 3, Block S. Unit Area: 4,618 square meters. - Sertifikat Hak Milik Atas Satuan Rumah Susun (Freehold Unit Title in a Multi-Storey Building) No. 334/V/S/Petojo Utara dated 26 July 1999. Unit No. S04-01, Level 4, Block S. Unit Area: 2,645 square meters. - Sertifikat Hak Milik Atas Satuan Rumah Susun (Freehold Unit Title in a Multi-Storey Building) No. 335/V-VI-VII/S/Petojo Utara dated 26 July 1999. Unit No. S04-02, Level 4-5-6, Block S. Unit Area: 3,205 square meters. - Sertifikat Hak Milik Atas Satuan Rumah Susun (Freehold Unit Title in a Multi-Storey Building) No. 336/VI-VII/S/Petojo Utara dated 26 July 1999. Unit No. S05-02, Level 5-6, Block S. Unit Area: 4,534 square meters. - Sertifikat Hak Milik Atas Satuan Rumah Susun (Freehold Unit Title in a Multi-Storey Building) No. 337/VII/S/Petojo Utara dated 26 July 1999. Unit No. S06A-01, Level 6A, Block S. Unit Area: 1,607 square meters. - Sertifikat Hak Milik Atas Satuan Rumah Susun (Freehold Unit Title in a Multi-Storey Building) No. 338/VIII/S/Petojo Utara dated 26 July 1999. Unit No. S07-01, Level 7, Block S. Unit Area: 591 square meters. - Sertifikat Hak Milik Atas Satuan Rumah Susun (Freehold Unit Title in a Multi-Storey Building) No. 438/I/S/Petojo Utara dated 3 June 2002. Unit No. SG-01A, Level 1, Block S. Unit Area: 5,186.1 square meters. - Sertifikat Hak Milik Atas Satuan Rumah Susun (Freehold Unit Title in a Multi-Storey Building) No. 440/II/S/Petojo Utara dated 3 June 2002. Unit No. SO1-O1A, Level 2, Block S. Unit Area: 4,755.6 square meters.

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Appendix E

Report No.017/WPA-Report/2007 Page 9. - Sertifikat Hak Milik Atas Satuan Rumah Susun (Freehold Unit Title in a Multi-Storey Building) No. 442/III/S/Petojo Utara dated 3 June 2002. Unit No. SO2-O1A, Level 2, Block S. Unit Area: 4,918.6 square meters. Land Zoning Type of Development No. of Building Block Building Level : : : : Commercial use. Shopping center. 1 block of shopping center and annexed multi-storey parking building. - Shopping center (7 floors and 1 basement level). - Parking building (8 floors). Initial Opening Year Gross Floor Area Lettable Floor Area Occupancy Level Tenancy Details : : : : : 1982. 66,160 square meters. 34,278 square meters. 89.1%. As at 30 June 2007, anchor and major tenants occupied about 55.9% of the total occupied retail space. Millenium Executive Club is the largest tenant which constituted about 18.3% of the total occupied retail spaces, Hypermart is the second largest tenant by 16.4%, Rimo Dept. Store is the third largest tenant by 9.1%, Eva Bun is the fourth largest tenant by 6.6%, and GM 21 Cineplex is the fifth largest by 5.5%. Millenium Executive Club has a 15-year lease term expiring in 29 October 2014, Hypermart has a 10-year lease term expiring in 2 February 2015, Rimo Dept. Store has a 2-year lease term expiring in 30 June 2008, Eva Bun has a 10-year lease term expiring in 2015, and GM 21 Cineplex has a 10-year lease term expiring in 2013. About 27.6% of the specialty shops including food outlets have a 5-year lease term, about 21% have a 2-year lease term, about 20.6% have 3-year lease term, about 14% have a 1-year or less lease term, about 11.6% have a 11.4-year lease term, and the remaining 5.2% have a 4-year or 20-year lease terms. The overall average base rental rate is about Rp. 71,523/square meter/month. The average base rental rate for the anchor tenants, Semi Ground Floor, Ground Floor, 1st Floor, 2nd Floor, 3rd Floor, 3rd Floor (computer shops), 3A Floor (food court and restaurant level), and 7 Floor respectively are about Rp. 35,166, Rp. 150,000, Rp. 202,317, Rp. 181,980, Rp. 150,670, Rp. 147,775, Rp. 68,449, Rp. 249,707, Rp. 24,767/square meter/month.

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Report No.017/WPA-Report/2007 Page 10. 3. Cibubur Junction Brief Description Cibubur Junction is a 5-storey with 1 basement level and partial roof top level shopping center with a total lettable retail floor area of about 34,139 square meters. It offers a wide range of shopping, dining, and leisure activities. The building accommodates a hypermarket, a department store, retail units, restaurants, food outlets, a book store, a fitness center, and a cineplex. Major tenants include Hypermart, Matahari Department Store, Timezone Amusement Center, Karisma Book Store, Sport Warehouse, Fitness First, and 21 Cineplex. Particulars Address : Jalan Jambore No. 1 Sub-District of Cibubur, District of Ciracas, Regency of East Jakarta, JakartaIndonesia. 31,987 square meters. Perusahaan Daerah Pembangunan Sarana Jaya DKI Jakarta. Hak Guna Bangunan No. 01210/Cibubur dated 24 December 2001. - Perjanjian Kerjasama Tentang Pendayagunaan Lahan Untuk Pembangunan dan Pengembangan Gedung Pusat Perbelanjaan di Areal Lahan Terletak di CibuburJakarta Timur (Deed of Cooperation Agreement on Land Utilization for Construction and Development of a Shopping Centre Located at CibuburEast Jakarta) No. 68 dated 28 July 2003. - Addendum I dated 25 November 2004. - Addendum II dated 26 November 2004. BOT Right Holder BOT Term Land Zoning Type of Development No. of Building Block Building Level Initial Opening Year : : : : : : : PT. Cibubur Utama. 20 (twenty) years from 28 July 2005 up to 28 July 2025. Or a remaining BOT term of 13.09 years from the date of valuation. Commercial use. Shopping center. 1 block. 5 floors with 1 basement level. 2005.

Land Area Land Owner Land Title BOT Agreement

: : : :

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Report No.017/WPA-Report/2007 Page 11. Gross Floor Area Lettable Floor Area Occupancy Level Tenancy Details : : : : 49,341 square meters. 34,139 square meters. 86.4%. As at 30 June 2007, anchor and major tenants occupied about 67.9% of the total occupied retail space. Hypermart is the largest tenant which constituted about 29.9% of the total occupied retail spaces, Matahari Group (Dept. Store and Timezone) is the second largest tenant by 22%, Fitness First is the third largest tenant by 5.7%, 21 Cineplex is the fourth largest tenant by 5.5%, and the remaining 4.9% is shared between Sports Warehouse and Karisma Book Store. Hypermart has a 10-year lease term expiring in 27 July 2015, Matahari Dept. Store has a 9.5-year lease term expiring in 30 August 2015, Timezone has a 9.75-year lease term expiring in 30 October 2015, Fitness First has a 15-year lease term expiring in 2021, and 21 Cineplex has a 10-year lease term expiring in 23 March 2016, whilst both Sports Warehouse and Karisma Book Store have a 5-year lease term expiring in 2010. About 65.7% of the specialty shops including food outlets have a 5-year lease term, about 27.1% have a 7-year lease term, and the remaining 7.2% have variable lease term of 1, 2, 3, or 10 years. The overall average base rental rate is about Rp. 86,584/square meter/month. The average base rental rate for the anchor tenants, Lower Ground Floor, Ground Floor, Upper Ground Floor, 1st Floor, 2nd Floor (food court and restaurant level) respectively are about Rp. 49,232, Rp. 215,732, Rp. 160,580, Rp. 180,522, Rp. 184,822, Rp. 169,850/square meter/month.

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Report No.017/WPA-Report/2007 Page 12. 4. Bandung Indah Plaza Brief Description Bandung Indah Plaza is the first major shopping center to be built in Bandung, the capital city of West Java Province. It is a 4-storey with 3 basement levels shopping center with a total lettable retail floor area of about 26,472 square meters. It offers a wide range of shopping, dining, and leisure activities. The building accommodates a supermarket, 2 department stores, retail units, restaurants, cafes, food outlets, food court, a book store, and a Cineplex. Major tenants include Hypermart, Matahari Department Store, Yogya Department Store, Timezone amusement center, 21 Cineplex, and Gunung Agung Book Store. Recently, Bandung Indah Plaza undergone renovations to its exterior and interior elements, and is currently undergoing tenancy mix repositioning exercise. The building reserves a total retail and temporary leasing areas of about 2,700 square meters, of which about 24% of the areas will start to be tenanted by middle of 2007, about 7% by 2008, and the remaining 69% by 2009. The building also has about 1,142 square meters space for casual leasing. Particulars Address : Jalan Merdeka No. 56 Sub-District of Citarum, District of Bandung Wetan, Regency of Bandung, West JavaIndonesia. 15,779 square meters. Perusahaan Daerah Jasa dan Kepariwisataan Pemerintah Propinsi Jawa Barat (The State Company for Tourism Service of the Government of West Java Province). - Hak Guna Bangunan (Right to Build) No. 26/Citarum Land Area : 1,066 square meters. Registered Proprietor : PT Megah Semesta Abadi Expiry Date : 14 August 2010 - 7 (seven) HGB titles registered under the name of PT. Megah Semesta Abadi, which are issued over Hak Pengelolaan (Right to Operate titles Nos. 1/Cihapit, 1/Citarum, 1/Merdeka, and 2/Citarum registered under the name of Perusahaan Daerah Jasa dan Kepariwisataan Pemerintah Propinsi Jawa Barat. (i) HGB Title No. 130/Citarum Land Area : Registered Proprietor : Expiry Date : HGB Title No. 131/Citarum Land Area : Registered Proprietor : Expiry Date : 160 square meters. PT Megah Semesta Abadi. 20 October 2017. 1,121 square meters. PT Megah Semesta Abadi. 20 October 2017.

Land Area Land Owner

: :

Land Title

(ii)

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Report No.017/WPA-Report/2007 Page 13. (iii) HGB Title No. 64/Citarum Land Area : Registered Proprietor : Expiry Date : HGB Title No. 65/Citarum Land Area : Registered Proprietor : Expiry Date : HGB Title No. 69/Citarum Land Area : Registered Proprietor : Expiry Date : HGB Title No. 89/Merdeka Land Area : Registered Proprietor : Expiry Date :

5,015 square meters. PT Megah Semesta Abadi. 8 September 2019. 1,355 square meters. PT Megah Semesta Abadi. 8 September 2019. 527 square meters. PT Megah Semesta Abadi. 8 September 2019. 3,665 square meters. PT Megah Semesta Abadi. 30 January 2021. 2,870 square meters. PT Megah Semesta Abadi. 30 January 2021.

(iv)

(v)

(vi)

(vii) HGB Title No. 90/Merdeka Land Area : Registered Proprietor : Expiry Date : BOT Agreement :

- Perjanjian Kerjasama Pemugaran, Pembangunan dan Pengelolaan Hotel PakunegaraBandung (Cooperation Agreement on the Renovation, Development and Management of Hotel Pakunegara, Bandung) No. 18 dated 30 August 1986. - Novasi Perjanjian Kerjasama Pemugaran, Pembangunan dan Pengelolaan Hotel PakunegaraBandung) (Deed of Novation for the Cooperation Agreement on the Renovation, Development and Management of Hotel Pakunegara, Bandung) No. 125 dated 29 December 2003, which novated the BOT right holder from PT. Bhuwanatala Indah Permai to PT Megah Semesta Abadi. - Amended several times, amongst others with: Pernyataan Kembali dan Perubahan Perjanjian Kerjasama Pemugaran, Pembangunan dan Pengelolaan Hotel Pakunegara Bandung (Kerjasama, Perluasan dan/atau Renovasi Mall) (Restatement and Amendment Deed to the Cooperation Agreement on the Renovation, Development and Management of Hotel Pakunegara, Bandung (Cooperation, Expansion and/or Renovation of the Mall) No. 50, dated 19 July 2005; and Akta Kesepakatan Bersama (Cooperation Agreement) No. 34, dated 22 December 2005

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Report No.017/WPA-Report/2007 Page 14. BOT Right Holder BOT Term : : PT. Megah Semesta Abadi. From 19 August 1990 (for BIP 1) and 1 May 1994 (for BIP 2) up to 31 December 2030. Or a remaining BOT term of 23.52 years from the date of valuation. Commercial use. Shopping center. 1 block. 4 floors with 3 basement levels. 1990 (BIP 1) and 1994 (BIP 2). 55,196 square meters. 26.472 square meters. 83.2%, based on the condition that currently about 2,701 square meters of retail and temporary leasing spaces are currently still vacant and will only be tenanted in stages starting from the middle of 2007 up to 2009. As at 30 June 2007, anchor and major tenants occupied about 60.6% of the total occupied retail space. Matahari Group (Dept. Store and Timezone) is the largest tenant which constituted about 28.9% of the total occupied retail spaces, Hypermart is the second largest tenant by 19.7%, 21 Cineplex is the third largest tenant by 7.9%, and Gunung Agung Book Store is the fourth largest tenant by 4.1%. Matahari Group Dept. Store, Timezone and Hypermart have a 9.5-year lease term expiring in 31 May 2015, 21 Cineplex has a 10-year lease term expiring in 31 December 2015, and Gunung Agung Book Store has a 5-year lease term expiring in 23 May 2011. About 81.2% of the specialty shops including food outlets have a 5-year lease term, about 14.4% have a 10-year lease term, and the remaining 4.4% have variable lease term of 1 to 4 years. The overall average base rental rate is about Rp. 141,230/square meter/month. The average base rental rate for the anchor tenants, Ground Floor, 1st Floor, 2nd Floor, 3rd Floor, and 3rd Floor (food court) respectively are about Rp. 45,000, Rp. 290,288, Rp. 262,956, Rp. 260,261, Rp. 213,056, Rp. 500,398/square meter/month.

Land Zoning Type of Development No. of Building Block Building Level Initial Opening Year Gross Floor Area Lettable Floor Area Occupancy Level

: : : : : : : :

Tenancy Details

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Report No.017/WPA-Report/2007 Page 15. 5. Istana Plaza Brief Description Istana Plaza is a 4-storey with 2 basement levels shopping center with a total lettable retail floor area of about 27,247 square meters. It offers a wide range of shopping, dining, and leisure activities. The building accommodates a supermarket, a department store, retail units, restaurants, cafes, food outlets, food court, a book store, a hardware store, and an ice skating facility. Major tenants include Hero Supermarket, Rimo Department Store, Game Master Amusement Center, Gramedia Book Store, Ace Hardware, Agis Electronic, a stand-alone McDonalds outlet, and an ice skating ring. Particulars Address : Jalan Pasir Kaliki No. 121-123 Sub-District of Pamayonan, District of Cicendo, Regency of Bandung, West JavaIndonesia. 13,082 square meters. Gereja Kristen Pasundan. - Hak Guna Bangunan (Right to Build) No. 43/Pamayonan Land Area : 12,350 square meters. Registered Proprietor : Gereja Kristen Pasundan Expiry Date : 24 September 2032. - Hak Guna Bangunan (Right to Build) No. 177/Pajajaran Land Area : 40 square meters. Registered Proprietor : Gereja Kristen Pasundan Expiry Date : 24 September 2032. - Hak Guna Bangunan (Right to Build) No. 58/Pamayonan Land Area : 86 square meters. Registered Proprietor : Gereja Kristen Pasundan Expiry Date : 24 September 2032. - Hak Guna Bangunan (Right to Build) No. 59/Pamayonan Land Area : 361 square meters. Registered Proprietor : Gereja Kristen Pasundan Expiry Date : 24 September 2032. - Hak Guna Bangunan (Right to Build) No. 60/Pamayonan Land Area : 245 square meters. Registered Proprietor : Gereja Kristen Pasundan Expiry Date : 24 September 2032.

Land Area Land Owner Land Title

: : :

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Report No.017/WPA-Report/2007 Page 16. BOT Agreement : - Perjanjian Kerjasama (Cooperation Agreement), dated 9 May 1997. - Amendment Agreement dated 28 June 2001. - Amendment Agreement dated 10 June 2004. BOT Right Holder BOT Term Land Zoning Type of Development No. of Building Block Building Level Initial Opening Year Gross Floor Area Lettable Floor Area Occupancy Level Tenancy Details : : : : : : : : : : : PT. Suryana Istana Pasundan. 32 (thirty two) years from 17 January 2002 Or a remaining BOT term of 26.57 years from the date of valuation. Commercial use. Shopping center. 1 block. 4 floors with 2 basement levels. 2003. 37,434 square meters. 27,247 square meters. 98.9%. As at 30 June 2007, anchor and major tenants occupied about 51.1% of the total occupied retail space. Rimo Dept. Store is the largest tenant which constituted about 17.2% of the total occupied retail spaces, McDonalds is the second largest tenant by 8.7%, Ace Hardware is the third largest tenant by 5.5%, Hero Supermarket is the fourth largest tenant by 5.0%, Gramedia Book Store is the fifth largest tenant by 4.6%, and the remaining 10.1% is shared between Agis Electronic, Ice Skating Ring, and Game Master. Rimo Dept. Store, Ace Hardware, Gramedia Book Store have a 10-year lease term expiring in 28 February 2012, Agis Electronic have a 5-year lease term expiring in 2007 (but have confirmed to extend the lease until 2012), Game Master and Ice Skating Ring have a 5-year lease term expiring in 2011 and 2012 respectively, whilst Hero Supermarket and McDonalds have a 20-year lease term expiring in 2020. About 75.1% of the specialty shops including food outlets have a 5-year lease term, about 18.6% have a 3-year lease term, and the remaining 6.3% have variable lease term of 1, 2, 4 or 10 years. The overall average base rental rate is about Rp. 88,458/square meter/month. The average base rental rate for the anchor tenants, Lower Ground Floor, Ground Floor, 1st Floor, 2nd Floor, 3rd Floor, and 3rd Floor (food court) respectively are about Rp. 43,678, Rp. 161,443, Rp. 232,124, Rp. 113,071, Rp. 121,089, Rp. 127,576, Rp. 235,747/square meter/month.

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Report No.017/WPA-Report/2007 Page 17. 6. Ekalokasari Plaza Brief Description Ekalokasari Plaza is a 6-storey with 3 basement levels shopping center with a total lettable retail floor area of about 20,587 square meters. It offers a wide range of shopping, dining, and leisure activities. The building accommodates a supermarket, a department store, retail units, restaurants, food outlets, and 2 book stores. Major tenants include Market Place Supermarket, Matahari Department Store, Gramedia Book Store, and Karisma Book Store. The building reserves a total retail space of about 5,013 square meters for a proposed Cineplex, a proposed amusement center, food court and restaurant areas, including temporary leasing areas on Level 4, and a proposed fitness center on the mezzanine floor of Level 4; which will start tenanting by middle to end of 2007. Particulars Address : Jalan Siliwangi No. 123 Sub-District of Sukasari, District of Kota Bogor Timur, Administrative City of Bogor, West JavaIndonesia. 10,500 square meters. PT. Bogor Life Science and Technology CQ Institut Pertanian Bogor (Bogor Institute of Agriculture). Hak Pakai (Right to Use) No. 1/Sukasari dated 22 December 1995. - Perjanjian Kerjasama (Cooperation Agreement) No. 133 dated 27 June 2001. - Addendum dated 9 February 2004. BOT Right Holder BOT Term Land Zoning Type of Development No. of Building Block Building Level Initial Opening Year : : : : : : : PT. Indah Pesona Bogor. 25 (twenty five) years from 27 June 2001 up to 27 June 2026. Or a remaining BOT term of 19.01 years from the date of valuation. Commercial use. Shopping center. 1 block. 6 floors with 3 basement levels. 2003.

Land Area Land Owner Land Title BOT Agreement

: : : :

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Report No.017/WPA-Report/2007 Page 18. Gross Floor Area Lettable Floor Area Occupancy Level : : : 39,895 square meters. 20,587 square meters. 87.3%, based on the condition that currently about 5,013-square meter retail and temporary leasing spaces on Level 4 and the mezzanine floor of Level 4 are still vacant and will only be tenanted by 3 major tenants i.e. Cinema 21, Fit By Beat, and Timezone by May and September 2007. As at 30 June 2007, anchor and major tenants occupied about 67.1% of the total occupied retail space. Matahari Group (Dept. Store and Market Place) is the largest tenant which constituted about 55.1% of the total occupied retail spaces, Gramedia Book Store is the second largest tenant by 6.7%, and Karisma Book Store is the third largest tenant by 5.3%. Matahari Group (Dept. Store and Market Place) has a 10-year lease term expiring in 23 March 2015, Gramedia has a 10-year lease term expiring in 22 May 2014, whilst Karisma Book Store has a 20-year lease term expiring on 29 February 2024. About 59.3% of the specialty shops including food outlets have a 5-year lease term, about 26.6% have a 20-year lease term, 8.1% have a 3-year lease term, and the remaining 6% have a 10-year lease term. The overall average base rental rate is about Rp. 73,669/square meter/month. The average base rental rate for the anchor tenants, Lower Ground Floor, Ground Floor, 1st Floor, 2nd Floor, and 3rd Floor respectively are about Rp. 34,164, Rp. 205,877, Rp. 158,995, Rp. 191,151, Rp. 128,176, Rp. 103,778/square meter/month.

Tenancy Details

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Report No.017/WPA-Report/2007 Page 19. 7. Mal Lippo Cikarang Brief Description Mal Lippo Cikarang is a 2-storey shopping center with an existing total lettable retail floor area of about 17,974 square meters. Mal Lippo Cikarang offers a wide range of shopping, dining, and leisure activities. The building accommodates a supermarket, a department store, retail units, restaurants, food outlets, food court, a book store, and a Cineplex. Major tenants include Hypermart, Hero Supermarket, Matahari Department Store, Utama Book Store, Timezone Amusement Center and 21 Cineplex. Particulars Address : Jalan M.H. Thamrin, Lippo Cikarang Sub-District of Cibatu, District of Lemah Abang, Regency of Bekasi, West JavaIndonesia. 49,250 square meters. PT. Graha Nusa Raya Hak Guna Bangunan/HGB (Right to Build) No. 627/Cibatu dated 9 December 1999. - Land Area - Registered Proprietor - Expiry Date Land Zoning Type of Development No. of Building Block Building Level Initial Opening Year Gross Floor Area : : : : : : Commercial use. Shopping center. 1 block. 2 floors. 1995. 25,767 square meters. : : : 49,250 square meters. PT. Graha Nusa Raya 5 May 2023 (extendable upon expiry).

Land Area Land Owner Land Title

: : :

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Report No.017/WPA-Report/2007 Page 20. Lettable Floor Area : - Existing retail spaces - Under construction proposed retail Extension building scheduled for completion and operation by July 2007) Future Total Occupancy Level Tenancy Details : : : : 17,884 square meters. 10,694 square meters.

28,668 square meters.

96.3%, based on current total lettable floor area of 17,884 square meters. As at 30 June 2007, existing anchor and major tenants occupied about 64.8% of the total occupied retail space. 79.8% of the additional NLA created from asset enhancement has been pre-committed to Hypermart. Matahari Group (Dept. Store and Timezone) is currently the largest tenant by about 38.6% of the total occupied retail spaces, Hero Supermarket is the second largest tenant by 13.0%, 21 Cineplex is the third largest tenant by 9.7%, and Utama Book Store is the fourt largest tenant by 3.6%. Hypermart has a 20-year lease term expiring in 30 June 2027, Matahari Group Dept. Store has a 20-year lease term expiring on 9 December 2026, Timezone has a 6-year lease term expiring in 30 September 2011, Hero Supermarket and Utama Book Store have a 2-year lease term expiring in 2007, and 21 Cineplex has a 10-year lease term expiring in 2015. About 27.2% of the specialty shops including food outlets have a 2-year lease term, 23.8% have a 1-year or less lease term, about 27.1% have a 3-year lease term, about 15.2% have a 5-year lease term, and the remaining 6.7% have variable lease term of 4 or 10 years. The overall average base rental rate is about Rp. 58,038/square meter/month. The average base rental rate for the anchor tenants, Ground Floor, and 1st Floor respectively are about Rp. 45,859, Rp. 128,089, Rp. 92,202/square meter/month.

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Report No.017/WPA-Report/2007 Page 21. Retail Spaces tenanted and operated by Matahari Group at: 1. Depok Town Square Brief Description Strata-titled retail space with a total floor area of about 13,045 square meters within Depok Town Squarea strata-titled shopping centerwhich are tenanted and operated by Hypermart, Matahari Department Store, and Timezone Amusement Center. Particulars Address : Depok Town Square Jalan Margonda Raya No. 1, Sub-District of Pondok Cina Beji, District of Depok, Regency of Depok, West JavaIndonesia. Selected strata-titled retail spaces on the Lower Ground Floor, First Floor and Second Floor. PT. Megah Detos Utama. - Perjanjian Pengikatan Jual Beli Satuan Kios/Kios (Binding Agreement for Sales and Purchase of Kiosk Unit/Kiosk) No. 031/AGR/DM/MPP/XII/02 dated 19 December 2002. - Perjanjian Pengikatan Jual Beli Satuan Kios/Kios (Binding Agreement for Sales and Purchase of Kiosk Unit/Kiosk) No. 012/JPN-PPJB/II/04 dated 11 February 2004. Lettable Floor Area Lessee Initial Occupation Year Occupancy Level Lease Term Rental Rate : : : : : : 13,045 square meters. PT. Matahari Putra Prima Tbk. 2005. 100%. 10 (ten) years with an option to renew for another ten (10) years after the expiry of the initial lease Term. - The lease rental rate for the year 2007 shall be a fixed amount of Rp. 70,000 per square meter per month. - The lease rental rate for each of the subsequent four calendar years after year 2007 shall increase by 8% from the preceding lease rental rate per square meter.

Object of Valuation Owner/Lessor Strata Title

: : :

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Report No.017/WPA-Report/2007 Page 22. - The lease rental lump-sum for each of the year, starting from the beginning of year 2012 to the end of year 2016, shall be computed as follows: (A) The lease rental rate per square meter paid in the Calendar Year 2009 multiplied by the lettable floor area of the space and by the number of months in that calendar year, added with (B) 4.25% of the Lessees excess revenue for the period between the immediately preceding calendar year and of the Base Year, which is fixed as Calendar Year 2010. 2. Mal WTC Matahari Brief Description Strata-titled retail space with a total floor area of about 11,184 square meters within Mal WTC Mataharia strata-titled shopping centerwhich are tenanted and operated by Hypermart, Matahari Department Store, and Timezone Amusement Center. Particulars Address : Mal WTC Matahari Jalan Raya Serpong, Sub-District of Pondok Jagung, District of Serpong, Regency of Tangerang, BantenIndonesia. Selected strata-titled retail spaces on the Ground Floor, Upper Ground Floor, Mezzanine and Second Floor. PT. Dinamika Serpong. - Sertifikat Hak Milik Atas Satuan Rumah Susun (Freehold Unit Title in a Multi-Storey Building) No. 00153/Pondok Jagung dated 17 December 2004. - Sertifikat Hak Milik Atas Satuan Rumah Susun (Freehold Unit Title in a Multi-Storey Building) No. 00197/Pondok Jagung dated 17 December 2004. - Sertifikat Hak Milik Atas Satuan Rumah Susun (Freehold Unit Title in a Multi-Storey Building) No. 00372/Pondok Jagung dated 17 December 2004. - Sertifikat Hak Milik Atas Satuan Rumah Susun (Freehold Unit Title in a Multi-Storey Building) No. 00428/Pondok Jagung dated 17 December 2004. Lettable Floor Area : 11,184 square meters.

Object of Valuation Owner/Lessor Strata Title

: : :

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Report No.017/WPA-Report/2007 Page 23. Lessee Initial Occupation Year Occupancy Level Lease Term Rental Rate : : : : : PT. Matahari Putra Prima Tbk. 2004. 100%. 10 (ten) years with an option to renew for another ten (10) years after the expiry of the initial lease Term. - The lease rental rate for the year 2007 shall be a fixed amount of Rp. 80,000 per square meter per month. - The lease rental rate for each of the subsequent four calendar years after year 2007 shall increase by 8% from the preceding lease rental rate per square meter. - The lease rental lump-sum for each of the year, starting from the beginning of year 2012 to the end of year 2016, shall be computed as follows: (A) The lease rental rate per square meter paid in the Calendar Year 2009 multiplied by the lettable floor area of the space and by the number of months in that calendar year, added with (B) 4.25% of the Lessees excess revenue for the period between the immediately preceding calendar year and of the Base Year, which is fixed as Calendar Year 2010. 3. Metropolis Town Square Brief Description Strata-titled retail space with a total floor area of about 15,248 square meters within Metropolis Town Squarea strata-titled shopping center which are tenanted and operated by Hypermart, Matahari Department Store, and Timezone Amusement Center. Particulars Address : Metropolis Town Square Jalan Hartono Raya, Sub-District of Kelapa Indah, District of Cikokol, Regency of Tangerang, BantenIndonesia. Selected strata-titled retail spaces on the Ground Floor, First Floor, and Second Floor. PT. Gema Metropolis Modern.

Object of Valuation Owner/Lessor

: :

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Report No.017/WPA-Report/2007 Page 24. Strata Title : - Perjanjian Pengikatan Jual Beli Satuan Kios/Kios (Binding Agreement for Sales and Purchase of Kiosk Unit/Kiosk) No. 054/AGR/DM/MPP/VI/03 dated 23 June 2003. - Perjanjian Pengikatan Jual Beli Satuan Kios/Kios (Binding Agreement for Sales and Purchase of Kiosk Unit/Kiosk) No. 084/AGR/DM/MPP/VIII/03 dated 25 August 2003. - Perjanjian Pengikatan Jual Beli Satuan Kios/Kios (Binding Agreement for Sales and Purchase of Kiosk Unit/Kiosk) No. 093/AGR/DM/MPP/IX/03 dated 10 September 2003. Lettable Floor Area Lessee Initial Occupation Year Occupancy Level Lease Term Rental Rate : : : : : : 15,248 square meters. PT. Matahari Putra Prima Tbk. 2004. 100%. 10 (ten) years with an option to renew for another ten (10) years after the expiry of the initial lease Term. - The lease rental rate for the year 2007 shall be a fixed amount of Rp. 80,000 per square meter per month. - The lease rental rate for each of the subsequent four calendar years after year 2007 shall increase by 8% from the preceding lease rental rate per square meter. - The lease rental lump-sum for each of the year, starting from the beginning of year 2012 to the end of year 2016, shall be computed as follows: (A) The lease rental rate per square meter paid in the Calendar Year 2009 multiplied by the lettable floor area of the space and by the number of months in that calendar year, added with (B) 4.25% of the Lessees excess revenue for the period between the immediately preceding calendar year and of the Base Year, which is fixed as Calendar Year 2010.

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Report No.017/WPA-Report/2007 Page 25. 4. Java Supermall Brief Description Strata-titled retail space with a total floor area of about 11,082 square meters within Java Supermall a strata-titled shopping centerwhich are tenanted and operated by Matahari Department Store, and Matahari Supermarket. Particulars Address : Java Supermall Jalan MT Haryono No. 992-994, Sub-District of Jomblang, District of Semarang Selatan, Regency of Semarang, Central JavaIndonesia. Selected strata-titled retail spaces on the Semi Basement Floor, First Floor, and Second Floor. PT. Java Mega Jaya. - Sertifikat Hak Milik Atas Satuan Rumah Susun (Freehold Unit Title in a Multi-Storey Building) No. 1/Lamper Kidul dated 23 November 1998. - Sertifikat Hak Milik Atas Satuan Rumah Susun (Freehold Unit Title in a Multi-Storey Building) No. 2/Lamper Kidul dated 23 November 1998. - Sertifikat Hak Milik Atas Satuan Rumah Susun (Freehold Unit Title in a Multi-Storey Building) No. 22/Lamper Kidul dated 23 November 1998. - Sertifikat Hak Milik Atas Satuan Rumah Susun (Freehold Unit Title in a Multi-Storey Building) No. 45/Lamper Kidul dated 18 April 2000. Lettable Floor Area Lessee Initial Occupation Year Occupancy Level Rental Rate : : : : : 11,082 square meters. PT. Matahari Putra Prima Tbk. 2000. 100%. - The lease rental rate for the year 2007 shall be a fixed amount of Rp. 80,000 per square meter per month. - The lease rental rate for each of the subsequent four calendar years after year 2007 shall increase by 8% from the preceding lease rental rate per square meter.

Object of Valuation Owner/Lessor Strata Title

: : :

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Appendix E

Report No.017/WPA-Report/2007 Page 26. - The lease rental lump-sum for each of the year, starting from the beginning of year 2012 to the end of year 2016, shall be computed as follows: (A) The lease rental rate per square meter paid in the Calendar Year 2009 multiplied by the lettable floor area of the space and by the number of months in that calendar year, added with (B) 4.25% of the Lessees excess revenue for the period between the immediately preceding calendar year and of the Base Year, which is fixed as Calendar Year 2010. 5. Plaza Madiun Brief Description Plaza Madiun is a 3-storey and one basement level retail building with a total lettable floor area of about 19,029 square meters, which is currently which are tenanted and operated by Matahari Department Store, Matahari Supermarket and Timezone Amusement Center. Particulars Address : Plaza Madiun Jalan Pahlawan No. 38-40, Sub-District of Pangongangan, District of Manguharjo, Regency of Madiun, Central JavaIndonesia. The entire building (Basement level, level one, level two, and level three) PT. Madiun Ritelindo. 5,583 square meters. - Hak Guna Bangunan/HGB (Right to Build) No. 186/Pangongangan. Land Area : 5,501 square meters. Expiry Date : 10 February 2012 (extendable upon expiry). - Hak Guna Bangunan/HGB (Right to Build) No. 188/Pangongangan. Land Area : 82 square meters. Expiry Date : 10 February 2012 (extendable upon expiry). Lettable Floor Area Lessee Initial Occupation Year Occupancy Level : : : : 19,029 square meters. PT. Matahari Putra Prima Tbk. 2001. 100%.

Object of Valuation Owner/Lessor Land Area Land Title

: : : :

Continue to page 27.

E-27

Appendix E

Report No.017/WPA-Report/2007 Page 27. Lease Term Rental Rate : : 10 (ten) years with an option to renew for another ten (10) years after the expiry of the initial lease Term. - The lease rental rate for the year 2007 shall be a fixed amount of Rp. 60,000 per square meter per month. - The lease rental rate for each of the subsequent four calendar years after year 2007 shall increase by 8% from the preceding lease rental rate per square meter. - The lease rental lump-sum for each of the year, starting from the beginning of year 2012 to the end of year 2016, shall be computed as follows: (A) The lease rental rate per square meter paid in the Calendar Year 2009 multiplied by the lettable floor area of the space and by the number of months in that calendar year, added with (B) 4.25% of the Lessees excess revenue for the period between the immediately preceding calendar year and of the Base Year, which is fixed as Calendar Year 2010. 6. Malang Town Square Brief Description Strata-titled retail space with a total floor area of about 11,065 square meters within Malang Town Squarea strata-titled shopping centerwhich are tenanted and operated by Hypermart, Matahari Department Store, and Timezone Amusement Center. Particulars Address : Malang Town Square Jalan Veteran No. 2, Sub-District of Penanggungan, District of Klojen, Regency of Malang, East JavaIndonesia. Selected strata-titled retail spaces on the Ground Floor, Upper Ground Floor, First Floor and Second Floor. PT. Matos Surya Perkasa. Perjanjian Pengikatan Jual Beli Satuan Kios/Kios - (Binding Agreement for Sales and Purchase of Kiosk Unit/Kiosk) - No. 031/PN-PPJB/X/03 dated 7 October 2003. Lettable Floor Area Lessee : : 11,065 square meters. PT. Matahari Putra Prima Tbk.

Object of Valuation Owner/Lessor Strata Title

: : :

Continue to page 28.

E-28

Appendix E

Report No.017/WPA-Report/2007 Page 28. Initial Occupation Year Occupancy Level Lease Term Rental Rate : : : : 2005. 100%. 10 (ten) years with an option to renew for another ten (10) years after the expiry of the initial lease Term. - The lease rental rate for the year 2007 shall be a fixed amount of Rp. 80,000 per square meter per month. - The lease rental rate for each of the subsequent four calendar years after year 2007 shall increase by 8% from the preceding lease rental rate per square meter. - The lease rental lump-sum for each of the year, starting from the beginning of year 2012 to the end of year 2016, shall be computed as follows: (A) The lease rental rate per square meter paid in the Calendar Year 2009 multiplied by the lettable floor area of the space and by the number of months in that calendar year, added with (B) 4.25% of the Lessees excess revenue for the period between the immediately preceding calendar year and of the Base Year, which is fixed as Calendar Year 2010. 7. Grand Palladium Brief Description Strata-titled retail space with a total floor area of about 13,417 square meters within Grand Palladiuma strata-titled shopping centerwhich are tenanted and operated by Hypermart, Matahari Department Store, and Timezone Amusement Center. Particulars Address : Grand Palladium Jalan Kapten Maulana Lubis, Sub-District of Petisah Tengah, District of Medan Petisah, Regency of Medan, North SumateraIndonesia. Selected strata-titled retail spaces on the Basement Floor, Lower Ground Floor, Upper Ground Floor, First Floor and Third Floor. PT. Palladium Megah Lestari. - Perjanjian Pengikatan Jual Beli Satuan Kios/Kios (Binding Agreement for Sales and Purchase of Kiosk Unit/Kiosk) No. 011/UPI-PPJB/IX/04 dated 14 September 2004.

Object of Valuation Owner/Lessor Strata Title

: : :

Continue to page 29.

E-29

Appendix E

Report No.017/WPA-Report/2007 Page 29. Lettable Floor Area Lessee Initial Occupation Year Occupancy Level Lease Term Rental Rate : : : : : : 13,417 square meters. PT. Matahari Putra Prima Tbk. 2005. 100%. 10 (ten) years with an option to renew for another ten (10) years after the expiry of the initial lease Term. - The lease rental rate for the year 2007 shall be a fixed amount of Rp. 70,000 per square meter per month. - The lease rental rate for each of the subsequent four calendar years after year 2007 shall increase by 8% from the preceding lease rental rate per square meter. - The lease rental lump-sum for each of the year, starting from the beginning of year 2012 to the end of year 2016, shall be computed as follows: (A) The lease rental rate per square meter paid in the Calendar Year 2009 multiplied by the lettable floor area of the space and by the number of months in that calendar year, added with (B) 4.25% of the Lessees excess revenue for the period between the immediately preceding calendar year and of the Base Year, which is fixed as Calendar Year 2010.

Continue to page 30.

E-30

Appendix E

Report No.017/WPA-Report/2007 Page 30. The following table summarizes the key details of each shopping center of the Properties:
Initial opening year Existing retail area(4) (m2) Occupancy level as at 30 Apr. 2007

Properties

Land title

Title tenure

1. The Plaza Semanggi . . . . . BOT(1) 2. Gajah Mada Plaza. . . . . . . Freehold strata title(2) 3. Cibubur Junction . . . . . . . . BOT(1) 4. Bandung Indah Plaza . . . . BOT(1) 5. Istana Plaza . . . . . . . . . . . BOT(1) 6. Ekalokasari Plaza . . . . . . . BOT(1) 7. Mal Lippo Cikarang . . . . . . Hak Guna Bangunan(3)

50 years, 2004 expiring in Jul. 2054 30 years, 1982 extendable upon expiry 20 years, 2005 expiring in Jul. 2025 40 years, 1990 and 1994 expiring in Dec. 2030 30 years, 2003 expiring in Nov. 2033 25 years, 2003 expiring in Jun. 2026 30 years, 1995 Extendable upon expiry

58,685(5) 34,278 34,139 26,472 27,247 20,587 17,974

96.4% 89.1% 86.4% 83.2% 98.9% 87.3% 96.3%

Note: (1) BOT stands for Build, Operate, and Transfer. This title is granted by the land owner to the shopping center developer for the right to build the shopping center, to collect income from retail space letting to third parties, and to hand over the building upon expiry of the tenure. Specific terms and conditions are as governed by a BOT agreement and its addendums. (2) Sertifikat Hak Milik Atas Satuan Rumah Susun (Freehold Unit Title in a Multi-Storey Building). (3) Hak Guna Bangunan title gives the right to construct and own buildings on a plot of land. The right is transferable and may be encumbered. Technically, HGB is a leasehold title with the State retains ownership. But for practical purposes, there is only little difference from a freehold title. HGB title is granted for an initial period of up to 30 years and is extendable for a subsequent period of up to 20 years. Upon the expiration of such extensions, new HGB title may be granted on the same land with the same tenure terms. The commencement date of each title varied. (4) Total existing lettable retail floor areas excludes any proposed buildings that are currently under construction and or any reserves of retail spaces yet to be occupied. (5) Current ongoing asset enhancement works to include a new caf called the Plangi on the Sky will increase NLA by an estimated 3,000 sq-m, bringing total NLA to approximately 61,685 sq-m by the end of 2007.

Continue to page 31.

E-31

Appendix E

Report No.017/WPA-Report/2007 Page 31. The following table summarizes the key details for each retail spaces leased by Matahari Group:
Lettable floor area(m2) Initial occupation year Occupancy level

Properties

Title

1. 2. 3. 4. 5. 6. 7.

Depok Town Square . . . . Mall WTC Matahari . . . . . Metropolis Town Square . . Java Supermall . . . . . . . . Plaza Madiun . . . . . . . . . Malang Town Square . . . . Grand Palladium . . . . . . .

. Binding Sales and Purchase . Freehold strata title(2) . Binding Sales and Purchase . Freehold strata title(2) . Hak Guna Bangunan(3) . Binding Sales and Purchase . Binding Sales and Purchase

Agreement(1) Agreement(1)

Agreement(1) Agreement(1)

13,045 11,184 15,248 11,082 19,029 11,065 13,417

2005 2004 2004 2000 2001 2005 2005

100% 100% 100% 100% 100% 100% 100%

Note: (1) Binding Sales and Purchase Agreement acts as valid ownership document prior to the issuance of a freehold strata unit title (Sertifikat Hak Milik Atas Satuan Rumah Susun). (2) Sertifikat Hak Milik Atas Satuan Rumah Susun (Freehold Unit Title in a Multi-Storey Building). (3) Hak Guna Bangunan title gives the right to construct and own buildings on a plot of land. The right is transferable and may be encumbered. Technically, HGB is a leasehold title with the State retains ownership. But for practical purposes, there is only little difference from a freehold title. HGB title is granted for an initial period of up to 30 years and is extendable for a subsequent period of up to 20 years. Upon the expiration of such extensions, new HGB title may be granted on the same land with the same tenure terms.

Continue to page 32.

E-32

Appendix E

Report No.017/WPA-Report/2007 Page 32. Valuation Rationale In arriving at our opinion of value, we have adopted the Income Valuation Method utilizing Discounted Cash Flow Analysis as the primary approach to arrive at our opinion of value and also with Investment Method by making consideration of relevant general and economic factors and in particular have investigated recent sales and leasing transactions of comparable properties that have occurred in the retail market. No allowance has been made in the Valuation for any charges, mortgages or amounts owing on the Properties or for any expenses or taxation which may be incurred in effecting a sale. Unless otherwise stated, it is assumed that the Properties are free from encumbrances, restrictions and outgoings of an onerous nature which could affect value. Discounted Cash Flow Analysis The Discounted Cash Flow (DCF) Method is used considering that the Properties are income producing properties. This form of analysis reflects investors decision-making process and values the Properties in such a manner as to attain the desired level of investment return commensurate with the risk of that asset class. This method is also more precise as it takes into account the timing receipts and payments. In undertaking this analysis, we have used a wide range of assumptions including rental growth, a reversionary market rental rate for each tenant type and its location, other income revenue growth, vacancy allowances, and inflation rate. Our valuation analysis also assumes that an operating company will manage the shopping centers and absorb all operating expenses for the first three years of the DCF analysis horizon; subject to the execution of the proposed operating company agreements. Where applicable, we have also taken into consideration royalty fees and/or other payments associated with the BOT agreements and the addendums to the land owners, and the remaining BOT tenure for Properties under BOT arrangements. We have carried out a DCF analysis over a five-year investment horizon from 30 June 2007 (the material date) to 30 June 2012 for the seven shopping centers, and over a ten-year horizon from 30 June 2007 (the material date) to 30 June 2017 for the seven retail spaces occupied by Matahari Group based on terms and conditions as stipulated in the proposed lease agreements for the Properties. Hypothetically, for the shopping centers held with HGB titles and/or with freehold strata title or its equivalent, we have assumed that the Properties are sold at the commencement of the sixth year of the cash flow. Our selected terminal capitalization rates, used to assess the terminal capital value of the Properties, take into consideration perceived market conditions in the future, estimated cash flow profile, and the overall physical condition of the Properties in 5 years time.

Continue to page 33.

E-33

Appendix E

Report No.017/WPA-Report/2007 Page 33. As for the shopping centers under BOT arrangements, since we are considering the leasehold interest up to the expiry of the BOT tenure, the sixth years net income is not capitalized at a single capitalization rate to perpetuity in view that the Properties may be surrendered to the land owner at the end of the BOT tenure, hence, the Properties may not have a terminal disposal capital value per se as would have been the case for the shopping centers held under HGB titles. In order to arrive at the fifth years terminal capitalized value for the BOT properties for the remaining years of the BOT period, we have capitalized the sixth years net income using dual capitalization rates i.e. a generally accepted terminal capitalization rate for similar properties held under HGB title, which takes into account a sinking fund provision in order to recoup the initial capital outlay at the end of the BOT period. The conversion of projected annual income streams into an estimate of the total present value is by application of a 14% annual discount rate based on our assessment of the current market requirements and the local property market conditions for an investment return over a five-year period from such properties located in Indonesia. We have also taken into account annual capital expenditure which is to be deducted from the projected annual rental income streams. Provision for capital expenditure is essential in order to maintain the Properties at a reasonable condition and to keep up with its current competition level in the market. Investment Method In the Investment Method, the estimated gross revenue has been adjusted to reflect an ongoing vacancy and subject to an operating company will manage the shopping centers and absorb all operating expenses to arrive at a net income. Gross revenue comprises rental from existing tenancies, potential future income from existing vacant units and turnover and other income of the Properties. Other income is in respect of sundry (e.g. license fees, rentals of atrium/kiosks, etc.) and car park income. The net income of the shopping centers held with HGB titles and/or with freehold strata title or its equivalent is capitalized at a capitalization rate which is appropriate for the type of use, tenure and reflective of the quality of the investment, based on analysis of yields reflected in the sales of comparable property types. Whilst, the net income of the shopping centers held under BOTarrangements is capitalized using dual capitalization rates i.e. a generally accepted terminal capitalization rate for similar properties held under HGB title, which takes into account a sinking fund provision in order to recoup the initial capital outlay at the end of the BOT period. Capital adjustments such as letting up allowance, capital expenditure provisions and capitalized rental reversions, royalty fees and/or other payments associated with the BOT agreements and the addendums to the land owners where applicable are then made to derive the capital value of the Properties.

Continue to page 34.

E-34

Appendix E

Report No.017/WPA-Report/2007 Page 34. Conclusion and Summary of Values We are of the opinion that the total aggregate Market Value of the Properties as at 30 June 2007; subject to the existing and proposed leases, occupancy and operational arrangements of the Properties, the terms and conditions of the relevant BOT agreements and their addendums, the terms and conditions of the proposed lease arrangements of the retail outlet stores with PT. Matahari Putra Prima Tbk as stipulated in the proposed Lease Agreements; the transfer of ownership of the Properties, the execution of the proposed Lease Agreements, the execution of the proposed Operating Company Agreement, the factual data, our assumptions, comments, qualifications, and limiting conditions as detailed in our full Reports, is: Rp. 5,927,600,000,000. (Rupiahs Five Trillion Nine Hundred Twenty Seven Billion and Six Hundred Million Only) Reflecting Singapore Dollars 1,004,677,966 at an exchange rate of Rp. 5,900 for every Singapore Dollar. The following table summarizes the salient valuation assumptions and Market Value for each of the Properties:
Market value as at 30 June 2007 Discount rate Initial yield Terminal capitalization rate Dual rate Single rate

Properties

The Plaza Semanggi . . . . . . Gajah Mada Plaza. . . . . . . . Cibubur Junction . . . . . . . . . Bandung Indah Plaza . . . . . Istana Plaza . . . . . . . . . . . . Ekalokasari Plaza . . . . . . . . Mal Lippo Cikarang . . . . . . . 13,045-sqm retail space at Depok Town Square . . . . . 11,184-sqm retail space at Mall WTC Matahari . . . . . 15,248-sqm retail space at Metropolis Town Square . . 11,082-sqm retail space at Java Supermall . . . . . . . . 19,029-sqm retail space at Plaza Madiun . . . . . . . . . 11,065-sqm retail space at Malang Town Square . . . . 13,417-sqm retail space at Grand Palladium . . . . . . . Total Aggregate . . . . . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

Rp. 1,267,600,000,000.* Rp. 612,300,000,000. Rp. 555,700,000,000.* Rp. 734,300,000,000.* Rp. 741,800,000,000.* Rp. 389,500,000,000.* Rp. 473,100,000,000. Rp. 151,400,000,000. Rp. 148,500,000,000. Rp. 197,900,000,000. Rp. 153,300,000,000. Rp. 197,200,000,000. Rp. 150,700,000,000. Rp. 154,300,000,000. Rp. 5,927,600,000,000.

14% 14% 14% 14% 14% 14% 14% 14% 14% 14% 14% 14% 14% 14%

9.1% 9.5%/6.5% 6.7% 9.7% 9.5%/6.5% 7.0% 10.5%/6.5% 7.5% 9.5%/6.5% 8.3% 9.5%/6.5% 6.6% 6.3% 6.3% 6.4% 6.0% 6.0% 6.1% 6.3% 7.80%

11% 10.5% 9.5% 9.5% 9.5% 9.5% 9.5% 9.5% 9.5%

..... ..... ..... ..... ..... ..... ..... .....

Note: * Market Value for the interest of the BOT right holder over the right to operate the Properties pursuant to the relevant BOT agreements and their addendums.

Continue to page 35.

E-35

Appendix E

Report No.017/WPA-Report/2007 Page 35. Disclaimer We have prepared this Valuation Summary Letter for inclusion in the Prospectus and specifically disclaim liability to any person in the event of any omission from or false or misleading statement included in the Prospectus, other than in respect of the information provided within the aforementioned Reports and this Valuation Summary Letter. We do not make any warranty or representation as to the accuracy of the information in any other part of the Prospectus other than as expressly made or given by Knight Frank/ PT. Willson Properti Advisindo in this letter. Knight Frank/PT. Willson Properti Advisindo has relied upon data supplied by the Manager and/or the owning companies and/or operator of the Properties, which we assume to be true and accurate. Knight Frank/PT. Willson Properti Advisindo takes no responsibility for inaccurate client supplied data and subsequent conclusions related to such data. The reported analyses, opinions and conclusions are limited only by the reported assumptions and limiting conditions and are our personal, unbiased professional analyses, opinions and conclusions. We have no present or prospective interest in the Properties and have no personal interest or bias with respect to the party/parties involved. The valuers compensation is not contingent upon the reporting of a predetermined value or direction in value that favours the cause of the client, the amount of the value estimate, the attainment of a stipulated result, or the occurrence of a subsequent event. We hereby certify that the valuers undertaking these valuations are authorized to practice as valuers and have the necessary expertise and experience in valuing similar types of properties. Yours faithfully, Knight Frank/PT. Willson Properti Advisindo

Willson Kalip, B.Sc. (Est. Mgt.) (Hons), MAPPI (Cert.) President Director Member of Indonesian Society of Appraiser (MAPPI) No: 94-S-00387 Valuation License No.: 1.99.0041 (Ministry of Finance of the Republic of Indonesia) Valuation License No.: AD 041-2004997D (Inland Revenue Authority of Singapore)

E-36

Appendix E Ref. No: V/2006/PKG/38 19 September 2007

PT Penilai 10F World Trade Centre Jl Jenderal Sudirman Kav 29-31 Jakarta 12920 Indonesia Tel Fax 62 21 521 1400 62 21 521 1411

HSBC Institutional Trust Services (Singapore) Limited (as Trustee of Lippo-Mapletree Indonesia Retail Trust Management Limited, LMIRT) 21 Collyer Quay #14-01 HSBC Building Singapore 049320 Attention: Head of Client Services Dear Sirs, We refer to instructions issued by Lippo-Mapletree Indonesia Retail Trust Management Limited (the Manager) to report to you the formal valuation advice, prepared as at 30 June 2007, in respect of the Market Value of the following properties (the Properties) for the inclusion into LMIRT, subject to the existing and proposed leases and occupancy arrangements: 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. Bandung Indah Plaza Istana Plaza Cibubur Junction Ekalokasari Plaza Mal Lippo Cikarang The Plaza Semanggi Gajah Mada Plaza Plaza Madiun Retail spaces at Depok Town Square Retail spaces at Grand Palladium Retail spaces at Mall WTC Matahari Retail spaces at Malang Town Square Retail spaces at Java Supermall Retail spaces at Metropolis Town Square

In accordance with your instructions, Colliers International/PT Penilai has prepared fourteen formal comprehensive valuation reports for the Properties (individually a Report and collectively the Reports). Our valuation is our opinion of the Market Value of the Properties, which is in accordance with the International Valuation Standards Committee definition of the estimated amount for which an asset should exchange on the date of Valuation between a willing buyer and a willing seller in an arms length transaction after proper marketing wherein the parties had each acted knowledgeably, prudently and without compulsion. This valuation summary report has been prepared for the purpose of inclusion in the prospectus to be issued in relation to the initial public offering of units in LMIRT, which will be listed on the Singapore Exchange Securities Trading Limited. The summary outlines the key factors that have been considered in arriving at our opinions of value. The value conclusions reflect all information known by us, market conditions and available data.
E-37

Appendix E

Reliance on This Letter This valuation summary report does not contain all the necessary data and support information included in our Reports. For further information to that contained herein, reference should be made to the Reports, copies of which are held by the Manager. The Valuation and market information contained in the Reports are not guarantees or predictions and must be read in consideration of the following: Each report is several pages in length and the conclusion as to the value assessment is based upon the factual information set forth in that Report. Whilst Colliers International/PT Penilai has endeavored to assure the accuracy of the factual information it has not independently verified all information provided by the Manager (primarily copies of leases, the Master Lease Agreement and other information with respect to the Properties) or the Government of the Republic of Indonesia (primarily statistical information with respect to market conditions). Colliers International/PT Penilai believes that every investor and every recipient of the Prospectus should review the Reports to understand the complexity of the methodology and the many variables involved prior to making an investment in the LMIRT. The methodology used by Colliers International/PT Penilai in valuing the Propertiesthe Discounted Cash Flow Analysisis based upon estimates of future results and are not predictions. This valuation methodology is summarized in the Valuation Rationale section of this summary report. The methodology begins with a set of assumptions as to income and expenses of the relevant Property and future economic conditions in the local market. The income and expenses figures are mathematically extended with the adjustments for anticipated changes in economic conditions. The resultant value is considered the best practice estimate, but is not to be construed as a prediction or guarantee and is fully dependent upon the accuracy of the assumptions as to income, expenses and market conditions. The Reports were undertaken based upon information available as at 30 June 2007. Colliers International/PT Penilai accepts no responsibility for subsequent changes in information as to income, expenses or market conditions. We have also relied on the information provided by the owning companies of the Properties. Whilst due care has been undertaken in the application of that information, we cannot verify its accuracy. Should it be revealed that any of this information is inaccurate or misleading so that its use would affect the valuation, we reserve the right to amend our opinion.

E-38

Appendix E

VALUATION CERTIFICATE Property Title : : Bandung Indah Plaza Jalan Merdeka No. 56, Bandung, West Java. - HGB Title No. 26/Citarum Covering Area: 1,066 square metres. Expiry Date: 14 August 2010. - HGB Title No. 130/Citarum Covering Area: 160 square metres. Expiry Date: 20 October 2017. - HGB Title No. 131/Citarum Covering Area: 1,121 square metres. Expiry Date: 20 October 2017 - HGB Title No. 64/Citarum Covering Area: 5,015 square metres. Expiry Date: 8 September 2019. - HGB Title No. 65/Citarum Covering Area: 1,355 square metres. Expiry Date: 8 September 2019. - HGB Title No. 69/Citarum Covering Area: 527 square metres. Expiry Date: 8 September 2019. - HGB Title No. 89/Merdeka Covering Area: 3,665 square metres. Expiry Date: 30 January 2021. - HGB Title No. 90/Merdeka Covering Area: 2,870 square metres. Expiry Date: 30 January 2021. - Held under BOT Agreements from 19 August 1990 for BIP 1 and 1 May 1994 for BIP 2, or a remaining BOT term of 24 years from the date of valuation. BOT Grantor : Perusahaan Daerah Jasa dan Kepariwisataan Pemerintah Proponsi Jawa Barat (State Company for Tourism Service of the Government of West Java Province). The subject property is located at Jalan Merdeka No. 56, about 2 km south of Bandungs CBD. Commercial.

Location Land Zoning

: :

E-39

Appendix E

Property Description

The Property is a four-storey with three basement levels shopping centre in the heart of the central business district of Bandung. The centre comprises two buildings and was developed in conjunction with the adjoining Hyatt Hotel in 1990. 15,779 square metres. 55,196 square metres. 26,472 square metres (as at 30 June 2007). 30,315 square metres (after asset enhancement). Rp. 797,220,000,000,(Indonesian Rupiahs Seven Hundred Ninety Seven Billion and Two Hundred Twenty Million Only). Or S$. 135,122,000,(Singapore Dollars One Hundred Thirty Five Million and One Hundred Twenty Two Thousand Only). Based on exchange rate adopted at SGD 1 = Rp. 5,900.00.

Site Area Gross Floor Area Net Lettable Area Market Value

: : : :

Date of Valuation Notice

: :

30 June 2007. This Valuation Certificate should be read in conjunction with the full valuation report which detailed the conditions and assumptions under which this valuation is prepared.

E-40

Appendix E

VALUATION CERTIFICATE Property Title : : Istana Plaza Jalan Pasir Kaliki No. 121-123, Bandung, West Java. - Hak Guna Bangunan (Right to Build) No. 43/Pamayonan Covering Area: 12,350 square metres. Expiry Date: 24 September 2032. - Hak Guna Bangunan (Right to Build) No. 177/Pajajaran Covering Area: 40 square metres. Expiry Date: 24 September 2032. - Hak Guna Bangunan (Right to Build) No. 58/Pamayonan Covering Area: 86 square metres. Expiry Date: 24 September 2032. - Hak Guna Bangunan (Right to Build) No. 59/Pamayonan Covering Area: 361 square metres. Expiry Date: 24 September 2032. - Hak Guna Bangunan (Right to Build) No. 60/Pamayonan Covering Area: 245 square metres. Expiry Date: 24 September 2032. - Held under BOT Agreements for 32 years from 17 January 2002 or a remaining BOT term of 26.9 years from the date of valuation. BOT Grantor Land Zoning Location Property Description : : : : Gereja Kristen Pasundan. Commercial. Jalan Pasir Kaliki No. 121-123, Pamoyanan Sub District, Cicendo District, about 4 km south of Bandungs CBD. The Property is a four-storey with two basement levels shopping centre and has become a major community focus for the northern and western regions of Bandung. The centre provides a one-stop shopping destination for the middle to middle and upper income residents in this region. The centre is located at the two busy roads, Jalan Pasir Kaliki and Jalan Padjajaran and is considered one of the major modern shopping centres serving the population of Bandung. It is approximately 2 km west of the centre of Bandung. 13,082 square metres. 37,434 square metres. 27,247 square metres.

Site Area Gross Floor Area Net Lettable Area

: : :

E-41

Appendix E

Market Value

Rp. 676,431,000,000,(Indonesian Rupiahs Six Hundred Seventy Six Billion and Four Hundred Thirty One Million Only). Or S$. 114,650,000,(Singapore Dollars One Hundred Fourteen Million and Six Hundred Fifty Thousand Only). Based on exchange rate adopted at SGD 1 = Rp. 5,900.00.

Date of Valuation Notice

: :

30 June 2007. This Valuation Certificate should be read in conjunction with the full valuation report which detailed the conditions and assumptions under which this valuation is prepared.

E-42

Appendix E

VALUATION CERTIFICATE Property Title : : Cibubur Junction Jalan Raya Jambore, Cibubur, East Jakarta. - Deed of Cooperation Agreement on Land Utilization for Construction and Development of a Shopping Centre Located at CibuburEast Jakarta (Perjanjian Kerjasama Tentang Pendayagunaan Lahan Untuk Pembangunan dan Pengembangan Gedung Pusat Perbelanjaan di Areal Lahan Terletak di CibuburJakarta Timur) No. 68 dated 28 July 2003. - Addendum I dated 25 November 2004. - Addendum II dated 26 November 2004. - Held under BOT Agreements for 20 years from 28 July 2005 up to 28 July 2025 or a remaining BOT term of 18.6 years from the date of valuation. BOT Grantor Land Zoning Location Property Description : : : : Perusahaan Daerah Pembangunan Sarana Jaya DKI Jakarta. Commercial. Approximately 26 km south east of Jakartas CBD within a growing middle to middle upper class district. The Property is a five-storey with one basement level and partial rooftop level shopping centre opened in July 2005. Since its opening, Cibubur Junction has quickly established itself as the key retail destination for middle to middle upper income residents within the region. 31,987 square metres. 49,341 square metres. 34,139 square metres.

Site Area Gross Floor Area Net Lettable Area

: : :

E-43

Appendix E

Market Value

Rp. 600,640,000,000,(Indonesian Rupiahs Six Hundred Billion and Six Hundred Forty Million Only). Or S$. 101,803,000,(Singapore Dollars One Hundred One Million and Eight Hundred Three Thousand Only). Based on exchange rate adopted at SGD 1 = Rp. 5,900.00.

Date of Valuation Notice

: :

30 June 2007. This Valuation Certificate should be read in conjunction with the full valuation report which detailed the conditions and assumptions under which this valuation is prepared.

E-44

Appendix E

VALUATION CERTIFICATE Property Title : : Ekalokasari Plaza Jalan Siliwangi 123, Bogor, West Java. - Cooperation Agreement (Perjanjian Kerjasama) No. 133 dated 27 June 2001. - Addendum dated 9 February 2004. - Held under BOT Agreements for 25 years from 27 June 2001 up to 27 June 2026 or a remaining BOT term of 19.5 years from the date of valuation. Land Zoning Location : : Commercial. The property is located approximately 2 km southeast of Bogor city c entre on Jalan Siliwangi, a major road which is approximately 1 kilometre west of the Jagorawi toll road. The Property is a large modern shopping centre comprising six storey and three basement levels which was opened in December 2003. The centre is currently undergoing major refurbishment and extensions. An addition of two new floors (third floor and mezzanine) comprising a range of lifestyle and entertainment facilities. 10,500 square metres. 39,895 square metres. 20,587 square metres (as at 30 June 2007). 25,600 square metres (after asset enhancement). : Rp. 401,580,000,000,(Indonesian Rupiahs Four Hundred One Billion and Five Hundred Eighty Million Only). Or S$. 68,064,000,(Singapore Dollars Sixty Eight Million and Sixty Four Thousand Only). Based on exchange rate adopted at SGD 1 = Rp. 5,900.00. Date of Valuation Notice : : 30 June 2007. This Valuation Certificate should be read in conjunction with the full valuation report which detailed the conditions and assumptions under which this valuation is prepared.

Property Description

Site Area Gross Floor Area Net Lettable Area Market Value

: :

E-45

Appendix E

VALUATION CERTIFICATE Property Title Land Zoning Location : : : : Mal Lippo Cikarang Jalan MH Thamrin Lippo Cikarang, Bekasi, West Java. - Held under HGB (Right To Build) No. 627/Cibatu, dated 9 December 1999 expiring on 5 May 2023 (extendable upon expiry). Commercial. The Property is located in Cikarang, which comprises industrial, commercial and residential estates and has attracted around 600 companies including overseas manufacturers taking advantage of the lower costs of manufacturing in Indonesia. It continues to grow in importance as a location for foreign investment with other prime industrial estates nearby, including the 3,000 hectare Jababeka Industrial Estate. Similarly, this estate is developing as self contained city with the Jababeka CBD complementing industrial and residential within the estate. The Property is a two-storey shopping centre opened in 1995. It is a onestop shopping complex serving the surrounding residential areas and workers in the nearby industrial estates. Currently the Property is in renovation for building extensions. 49,250 square metres. 25,767 square metres. 17,974 square metres (as at 30 June 2007). 28,668 square metres (after asset enhancement). Rp. 470,361,000,000,(Indonesian Rupiahs Four Hundred Seventy Billion and Three Hundred Sixty One Million Only). Or S$. 79,722,000,(Singapore Dollars Seventy Nine Million and Seven Hundred Twenty Two Thousand Only). Based on exchange rate adopted at SGD 1 = Rp. 5,900.00. Date of Valuation Notice : : 30 June 2007. This Valuation Certificate should be read in conjunction with the full valuation report which detailed the conditions and assumptions under which this valuation is prepared.

Property Description

Site Area Gross Floor Area Net Lettable Area Market Value

: : : :

E-46

Appendix E

VALUATION CERTIFICATE Property Title : : The Plaza Semanggi Jalan Jenderal Sudirman Kav. 50, South Jakarta. - Introductory Agreement of Revitalization, Management and Transfer (Perjanjian Pengikatan Revitalisasi, Pengelolaan dan Pengalihan) dated 5 January 2000. - Deed of Revitalization, Development, Management and Transfer (Perjanjian Revitalisasi, Pembangunan, Pengolahan dan Pengalihan) No. 56 dated 29 March 2000. - Deed of Addendum for the Deed of Revitalization, Development, Management and Transfer (Addendum Perjanjian Revitalisasi, Pembangunan, Pengolahan dan Pengalihan) Nos. 25 and 26 dated 26 May 2000. - Deed of Addendum for the Deed of Revitalization, Development, Management and Transfer (Addendum Perjanjian Revitalisasi, Pembangunan, Pengolahan dan Pengalihan) dated 29 January 2002. - Held under BOT Agreements for 30 years from 18 July 2004 up to 18 July 2034 with an extension term of 20 years from 18 July 2034 up to 18 July 2054 or a remaining BOT term of 47.6 years from the date of valuation. Land Zoning Location : : Commercial. The Property is located on Jalan Jenderal Sudirman, Setiabudi district. The mall is strategically located at the centre of the Jakarta CBD within the Semanggi interchange which is a major throroughfare for north-south and east-west traffic and adjacent to a number of Jakartas most prominent universities, including Atmajaya University, and PT. Telkom office. The surrounding site comprises offices, schools and hotel buildings along Jalan Jenderal Sudirman and Jalan Jenderal Gatot Subroto. The Property is a seven-storey with two basement levels modern shopping centre and a 13-level office building. The mall in the Property is complemented by a range of non-retail uses within the mixed use development, such as a convention hall and an office tower, including a night club. 19,000 square metres. 91,232 square metres.

Property Description

Site Area Gross Floor Area

: :

E-47

Appendix E

Net Lettable Area Market Value

: :

58,685 square metres (as at 30 June 2007). 61,685 square metres (after asset enhancement). Rp. 1,245,200,000,000,(Indonesian Rupiahs One Trillion Two Hundred Forty Five Billion and Two Hundred Million Only). Or S$. 211,051,000,(Singapore Dollars Two Hundred Eleven Million and Fifty One Thousand Only). Based on exchange rate adopted at SGD 1 = Rp. 5,900.00.

Date of Valuation Notice

: :

30 June 2007. This Valuation Certificate should be read in conjunction with the full valuation report which detailed the conditions and assumptions under which this valuation is prepared.

E-48

Appendix E

VALUATION CERTIFICATE Property Title : : Gajah Mada Plaza Jalan Gajah Mada No. 19-26, Central Jakarta. Strata Titles as evidenced by certificates: - No. 325/-I/S/Petojo Utara dated 26 July 1999. Covering Area: 5,228 square metres. Expiry Date: 24 January 2020. - No. 326/-I/S/Petojo Utara dated 26 July 1999. Covering Area: 135 square metres. Expiry Date: 24 January 2020. - No. 328/I/S/Petojo Utara dated 26 July 1999. Covering Area: 18 square metres. Expiry Date: 24 January 2020. - No. 330/II/S/Petojo Utara dated 26 July 1999. Covering Area: 17 square metres. Expiry Date: 24 January 2020. - No. 332/III/S/Petojo Utara dated 26 July 1999. Covering Area: 43 square metres. Expiry Date: 24 January 2020. - No. 333/IV/S/Petojo Utara dated 26 July 1999. Covering Area: 4,618 square metres. Expiry Date: 24 January 2020. - No. 334/V/S/Petojo Utara dated 26 July 1999. Covering Area: 2,645 square metres. Expiry Date: 24 January 2020. - No. 335/V-VI-VII/S/Petojo Utara dated 26 July 1999. Covering Area: 3,205 square metres. Expiry Date: 24 January 2020. - No. 336/VI-VII/S/Petojo Utara dated 26 July 1999. Covering Area: 4,534 square metres. Expiry Date: 24 January 2020. - No. 337/VII/S/Petojo Utara dated 26 July 1999. Covering Area: 1,607 square metres. Expiry Date: 24 January 2020.

E-49

Appendix E

- No. 338/VIII/S/Petojo Utara dated 26 July 1999. Covering Area: 591 square metres. Expiry Date: 24 January 2020. - No. 438/I/S/Petojo Utara dated 3 June 2002. Covering Area: 5,186.1 square metres. Expiry Date: 24 January 2020. - No. 440/II/S/Petojo Utara dated 3 June 2002. Covering Area: 4,755.6 square metres. Expiry Date: 24 January 2020. - No. 442/III/S/Petojo Utara dated 3 June 2002. Covering Area: 4,918.6 square metres. Expiry Date: 24 January 2020. Location : The Property is located in the citys traditional Chinatown precinct including mixed of residential and commercial uses, the centre is also within the vicinity of the capital citys main civic buildings such as Presidential and Vice Presidential Palace are located only 5 kilometres north of Jakartas CBD area. Commercial. The Property is an established seven-storey with one basement level shopping centre which has been operated for more than 25 years and has a firm position as a one-stop shopping destination to meet the everyday convenience retail requirements of local residents considered to be in the middle and middle upper segments. 37,501 square metres. 66,160 square metres. 34,278 square metres Rp. 690,108,000,000,(Indonesian Rupiahs Six Hundred Ninety Billion and One Hundred Eight Million Only). Or S$. 116,967,000,(Singapore Dollars One Hundred Sixteen Million and Nine Hundred Sixty Seven Thousand Only). Based on exchange rate adopted at SGD 1 = Rp. 5,900.00. Date of Valuation Notice : : 30 June 2007. This Valuation Certificate should be read in conjunction with the full valuation report which detailed the conditions and assumptions under which this valuation is prepared.

Land Zoning Property Description

: :

Strata Title Area Gross Floor Area Net Lettable Area Market Value

: : : :

E-50

Appendix E

VALUATION CERTIFICATE Property Title : : Plaza Madiun Jalan Pahlawan No. 38-40, Madiun, East Java. Held under HGBs (Right To Build) No. 186/Pangongangan and No. 188/Pangongangan both expiring on 10 February 2012 (extendable upon expiry). The Property is located in the city of Madiun, which is located around 169 kilometres west of Surabaya. It benefits from its position which connects major cities in Central and East Java. The citys industrial sector contributes significant portion to the citys economy. Commercial. The Property is a three-storey shopping centre with one basement level and the biggest in the area. The shopping centre enjoys high exposure from Jalan Pahlawan and has an easy access to transportation. 5,583 square metres. 19,029 square metres. Rp. 187,403,000,000,(Indonesian Rupiahs One Hundred Eighty Seven Billion Four Hundred and Three Million Only). Or S$. 31,763,000,(Singapore Dollars Thirty One Million and Seven Hundred Sixty Three Thousand Only). Based on exchange rate adopted at SGD 1 = Rp. 5,900.00. Date of Valuation Notice : : 30 June 2007. This Valuation Certificate should be read in conjunction with the full valuation report which detailed the conditions and assumptions under which this valuation is prepared.

Location

Land Zoning Property Description

: :

Site Area Net Lettable Area Market Value

: : :

E-51

Appendix E

VALUATION CERTIFICATE Property Title : : Retail spaces at Depok Town Square Jalan Margonda Raya No. 1, Cina Beji, Depok, West Java. Held under Kiosks Sale and Purchase Binding Agreements No. 031/AGR/DM/MPP/XII/02 dated 19 December 2002 and No. 012/JPNPPJB/II/04 dated 11 February 2004. The Property is located within Depok Town Square, one of the newest and most comprehensive malls in Depok, a growing city approximately 16 kilometres south of Jakartas CBD. The city of Depok has experienced high demand for residential accommodation. The shopping centre is adjacent to the southeastern side of University of Indonesia, one of the biggest and most prominent universities in Indonesia. Commercial. The Property comprises of retails spaces on lower ground floor, first floor and second floors currently utilized as a hypermarket (Hypermart), department store (Matahari Department Store) and entertainment and gaming center (Timezone). 13,045 square metres. Rp. 146,024,000,000,(Indonesian Rupiahs One Hundred Forty Six Billion and Twenty Four Million Only). Or S$. 24,750,000,(Singapore Dollars Twenty Four Million and Seven Hundred Fifty Thousand Only). Based on exchange rate adopted at SGD 1 = Rp. 5,900.00. Date of Valuation Notice : : 30 June 2007. This Valuation Certificate should be read in conjunction with the full valuation report which detailed the conditions and assumptions under which this valuation is prepared.

Location

Land Zoning Property Description

: :

Net Lettable Area Market Value

: :

E-52

Appendix E

VALUATION CERTIFICATE Property Title Location : : : Retail spaces at Grand Palladium Jalan Kapten Maulana Lubis, Medan, North Sumatra. Held under Kiosks Sale and Purchase Binding Agreement No. 011/UPIPPJB/IX/04 dated 14 September 2004. The Property is located within Grand Palladium, a shopping centre located on Jalan Kapten Maulana Lubis in the city of Medan, the largest city in Sumatra and surrounded by office and government buildings. Commercial. The Property comprises of retail spaces on the basement floor, lower ground floor, upper ground floor, first floor and third floor currently utilized as a hypermarket (Hypermart), department store (Matahari Department Store) and entertainment and gaming centre (Timezone). 13,417 square metres. Rp. 148,425,000,000,(Indonesian Rupiahs One Hundred Forty Eight Billion and Four Hundred Twenty Five Million Only). Or S$. 25,157,000,(Singapore Dollars Twenty Five Million and One Hundred Fifty Seven Thousand Only). Based on exchange rate adopted at SGD 1 = Rp. 5,900.00. Date of Valuation Notice : : 30 June 2007. This Valuation Certificate should be read in conjunction with the full valuation report which detailed the conditions and assumptions under which this valuation is prepared.

Land Zoning Property Description

: :

Net Lettable Area Market Value

: :

E-53

Appendix E

VALUATION CERTIFICATE Property Title : : Retail spaces at Mall WTC Matahari Jalan Raya Serpong, Pondok Jagung, Serpong, Tangerang, Banten. Held under Strata Titles Ownership Certificates No. 00153/Pondok Jagung dated 17 December 2004, No. 00197/Pondok Jagung dated 17 December 2004, No. 00372/Pondok Jagung dated 17 December 2004 and No. 00428/Pondok Jagung dated 17 December 2004. The Property is within Mall WTC Matahari. The centre is strategically located within the vicinity of Bumi Serpong Damai City, one of the largest residential estates in Tangerang, a renowned industrial and manufacturing city in Greater Jakarta. Tangerang has benefited from urban expansion of Jakarta and is being home to seven industrial estates with over 1,700 ha area. Commercial. The Property comprises of retail spaces on the ground floor, upper grond floor, mezzanine and second floor currently utilized as a hypermarket (Hypermart), department store (Matahari Department Store) and entertainment and gaming center (Timezone). 11,184 square metres. Rp. 143,469,000,000,(Indonesian Rupiahs One Hundred Forty Three Billion and Four Hundred Sixty Nine Million Only). Or S$. 24,317,000,(Singapore Dollars Twenty Four Million and Three Hundred Seventeen Thousand Only). Based on exchange rate adopted at SGD 1 = Rp. 5,900.00. Date of Valuation Notice : : 30 June 2007. This Valuation Certificate should be read in conjunction with the full valuation report which detailed the conditions and assumptions under which this valuation is prepared.

Location

Land Zoning Property Description

: :

Net Lettable Area Market Value

: :

E-54

Appendix E

VALUATION CERTIFICATE Property Title Location : : : Retail spaces at Malang Town Square Jalan Veteran No. 2, Malang, East Java. Held under Kiosks Sale and Purchase Binding Agreement No. 031/PNPPJB/X/03 dated 7 October 2003. The Property is located within Malang Town Square, the biggest and most comprehensive mall in the city of Malang, the second largest city in East Java province. The city has a large student population, being home to five universities and three of them are within the proximity of the Property. Commercial. The Property comprises of retail spaces on the ground floor, upper ground floor, first floor and second floor currently utilized as a hypermarket (Hypermart), department store (Matahari Department Store) and entertainment and gaming center (Timezone). 11,065 square metres. Rp. 151,945,000,000,(Indonesian Rupiahs One Hundred Fifty One Billion and Nine Hundred Forty Five Million Only). Or S$. 25,753,000,(Singapore Dollars Twenty Five Million and Seven Hundred Fifty Three Thousand Only). Based on exchange rate adopted at SGD 1 = Rp. 5,900.00. Date of Valuation Notice : : 30 June 2007. This Valuation Certificate should be read in conjunction with the full valuation report which detailed the conditions and assumptions under which this valuation is prepared.

Land Zoning Property Description

: :

Net Lettable Area Market Value

: :

E-55

Appendix E

VALUATION CERTIFICATE Property Title : : Retail spaces at Java Supermall Jalan MT Haryono No. 992-994, Jomblang, Semarang, Central Java. Held under Strata Titles Ownership Certificates No. 1/Lamper Kidul dated 23 November 1998, No. 2/Lamper Kidul dated 23 November 1998, No. 22/Lamper Kidul dated 23 November 1998 and No. 45/Lamper Kidul dated 18 April 2000. The Property is located within Java Supermall, a mall within the vicinity of an upper middle class residential area in Semarang, the capital city of Central Java. The city is the fifth largest city in terms of population in Indonesia. Commercial. The Property comprises of retail spaces on the semi-basement, first floor and second floor currently utilized as a supermarket (Matahari Supermarket) and department store (Matahari Department Store). 11,082 square metres. Rp 147,230,000,000,(Indonesian Rupiahs One Hundred Forty Seven Billion and Two Hundred Thirty Million Only). Or S$. 24,954,000,(Singapore Dollars Twenty Four Million and Nine Hundred Fifty Four Thousand Only). Based on exchange rate adopted at SGD 1 = Rp. 5,900.00. Date of Valuation Notice : : 30 June 2007. This Valuation Certificate should be read in conjunction with the full valuation report which detailed the conditions and assumptions under which this valuation is prepared.

Location

Land Zoning Property Description

: :

Net Lettable Area Market Value

: :

E-56

Appendix E

VALUATION CERTIFICATE Property Title : : Retail Spaces at Metropolis Town Square. Jalan Hartono Raya, Modernland Cikokol, Tangerang, Banten. Held under Kiosks Sale and Purchase Binding Agreements No. 054/AGR/ DM/MPP/VI/03 dated 23 June 2003, No. 084/AGR/DM/MPP/VIII/03 dated 25 August 2003, 093/AGR/DM/MPP/IX/03 dated 10 September 2003. The Property is located within Metropolis Town Square, a one-stop shopping centre on one of the main roads in Tangerang near the Modernland residential estates, about 3 kilometres south of the city centre of Tangerang. The city of Tangerang is a popular residential estates due to its proximity to Jakarta, which is approximately 20 km west of Jakartas CBD. Commercial. The Property comprises of retail spaces on the ground floor, first floor and second floor currently utilized as a hypermarket (Hypermart), department store (Matahari Department Store) and entertainment and gaming center (TimeZone). 15,248 square metres. Rp. 189,874,000,000 (Indonesian Rupiahs One Hundred Eighty Nine Billion and Eight Hundred Seventy Four Million Only). Or S$. 32,182,000,(Singapore Dollars Thirty Two Million and One Hundred Eighty Two Thousand Only). Based on exchange rate adopted at SGD 1 = Rp. 5,900.00. Date of Valuation Notice : : 30 June 2007. This Valuation Certificate should be read in conjunction with the full valuation report which detailed the conditions and assumptions under which this valuation is prepared.

Location

Land Zoning Property Description

: :

Net Lettable Area Market Value

: :

E-57

Appendix E

Valuation Rationale In arriving at our opinion value, we have considered relevant general and economic factors. We have utilized Discounted Cash Flow Analysis and Direct Comparison in undertaking our assessment of the Properties. We have investigated recent sales and leasing transactions of comparable properties that have occurred in the shopping center market. Discounted Cash Flow Analysis This approach gives consideration to the existing income earning and the future expectation income at the certain time, which can be generated by the property. The stream of future earnings are either capitalized or discounted at an appropriate rate to arrive at an indication of value at which ownership would be justified by a prudent investor. We have carried out a discounted cash flow analysis over a 5-year investment horizon in which we have assumed that the Properties is sold at the commencement of the sixth year of the cash flow. This form of analysis allows an investor or owner to make an assessment of the long term return that is likely to be derived from the properties with a combination of both rental and capital growth over an assumed investment horizon. In undertaking this analysis, a wide range of assumptions are made including a target internal rate of return, rental growth, sales turnover growth and sale price of the property at the end of investment horizon. While the Properties generate mostly Indonesian Rupiah denominated cash flow, we understand that there will be hedging arrangement in place that allows us to appropriately assume that the cash flow will be converted from Indonesian Rupiah into Singapore Dollar and to value the Properties by taking into consideration such an arrangement. The following table summarizes the key details for each of the Properties:
Gross building floor area (m2) Net lettable area (m2)

Properties

Land area (m2)

Land title

Land zoning

Bandung Indah Plaza. . . . . . . . . . . . . . . . . Istana Plaza. . . . . . . . . . . . . . . . . . . . . . . . Cibubur Junction . . . . . . . . . . . . . . . . . . . . Ekalokasari Plaza . . . . . . . . . . . . . . . . . . . Mal Lippo Cikarang . . . . . . . . . . . . . . . . . . The Plaza Semanggi . . . . . . . . . . . . . . . . . Gajah Mada Plaza . . . . . . . . . . . . . . . . . . . Plaza Madiun. . . . . . . . . . . . . . . . . . . . . . . Retail spaces at Depok Town Square . . . . . Retail spaces at Grand Palladium . . . . . . . Retail spaces at Mall WTC Matahari . . . . .

15,779 13,082 31,987 10,500 49,250 19,000 37,501(1) 5,583

55,196 37,434 49,341 39,895 25,767 91,232 66,160

26,472 27,247 34,139 20,587 17,974 58,685 34,278 19,029 13,045 13,417 11,184

BOT BOT BOT BOT HGB BOT HGB HGB Strata Strata Strata

Commercial Commercial Commercial Commercial Commercial Commercial Commercial Commercial Commercial Commercial Commercial

E-58

Appendix E

Properties

Land area (m2)

Gross building floor area (m2)

Net lettable area (m2)

Land title

Land zoning

Retail spaces at Malang Town Square . . . . Retail spaces at Java Supermall . . . . . . . . Retail spaces at Metropolis Town Square . . (1) Strata Title Area Conclusion and Summary of Values

11,065 11,082 15,248

Strata Strata Strata

Commercial Commercial Commercial

We are of the opinion that the total aggregate Market Value of the Properties as at 30 June 2007 subject to the transfer of ownership of the Properties, to all existing tenancies and occupancy arrangements, the execution of the proposed Master Lease Agreement, the factual data, our assumptions, comments, qualifications, and limiting conditions as detailed in our full Reports, is: S$1,016,255,000 (Singapore Dollars One Billion Sixteen Million and Two Hundred Fifty Five Thousand Only) The following table summarizes the salient valuation assumptions and Market Value for each of the Properties:
Market value as at 30 June 2007 (S$) Discount rate Terminal capitalization rate

Properties

Bandung Indah Plaza . . . . . . . . . . . . . . . . . . . . . . . . . . . . Istana Plaza . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Cibubur Junction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Ekalokasari Plaza . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Mal Lippo Cikarang . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . The Plaza Semanggi . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Gajah Mada Plaza . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Plaza Madiun . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Retail spaces at Depok Town Square. . . . . . . . . . . . . . . . . Retail spaces at Grand Palladium . . . . . . . . . . . . . . . . . . . Retail spaces at Mall WTC Matahari . . . . . . . . . . . . . . . . . Retail spaces at Malang Town Square . . . . . . . . . . . . . . . . Retail spaces at Java Supermall . . . . . . . . . . . . . . . . . . . . Retail spaces at Metropolis Town Square. . . . . . . . . . . . . .

135,122,000 114,650,000 101,803,000 68,064,000 79,722,000 211,051,000 116,967,000 31,763,000 24,750,000 25,157,000 24,317,000 25,753,000 24,954,000 32,182,000

14% 14% 14% 14% 14% 14% 14% 14% 14% 14% 14% 14% 14% 14%

9% 9% 9% 9% 9% 9% 9% 9% 9% 9% 9% 9% 9% 9%

E-59

Appendix E

Disclaimer We have prepared this Valuation Summary Letter for inclusion in the Prospectus and specifically disclaim liability to any person in the event of any omission from or false or misleading statement included in the Prospectus, other than in respect of the information provided within the aforementioned Reports and this Valuation Summary Letter. We do not make any warranty or representation as to the accuracy of the information in any other part of the Prospectus other than as expressly made or given by Colliers International/ PT Penilai in this Letter. Colliers International / PT Penilai has relied upon data supplied by the Manager and/or the owning companies of the Properties, which we assume to be true and accurate. Colliers International / PT Penilai takes no responsibility for inaccurate client supplied data and subsequent conclusions related to such data. The reported analyses, opinions and conclusion are limited only by the reported assumptions and limiting conditions and are our personal, unbiased professional analyses, opinions and conclusions. We have no present or prospective interest in the Properties and have no personal interest or bias with respect to the party/parties involved. The valuers compensation is not contingent upon the reporting of a predetermined value or direction in value that favours the cause of the client, the amount of the value estimate, the attainment of a stipulated result, or the occurrence of a subsequent event. We hereby certify that the valuers undertaking these valuations are authorized to practice as valuers and have the necessary expertise and experience in valuing similar types of properties.

Your Faithfully, PT PENILAI Member of Indonesian Appraisal Companies Association (GAPPI) No. 016 in Association with Colliers International

Ir. Hendra Gunawan M.Sc. (MAPPI Cert.) Director of PT PENILAI Capital Market Valuer License: 28/PM/STTD-P/A/2006 Member of Indonesian Society of Appraisers (MAPPI) No. 81-S-00005 Public Valuer License No. 1.99.0019

E-60

Appendix E

ADDENDUMSTATEMENT OF ASSUMPTIONS AND LIMITING CONDITIONS 1. An opinion of value will always involve a degree of subjectivity and uncertainty that will affect the probability that the opinion of market value would be the same as the price achieved by an actual sale at the valuation date. The assessment of value is dependent upon the accuracy of the information available to us pertaining to the Properties and the market, together the underlying conditions and assumptions made. If these conditions and assumptions are not fulfilled, all future projections and the value reflected herein should be reappraised in light of actual events. All information (facilities overview, estimates, and opinions) obtained from parties not employed by PT Penilai/Colliers International is assumed to be true and correct. PT Penilai/Colliers International can assume no liability resulting from misinformation. No responsibility is assumed for matters of a legal nature, nor do we renders any opinion as to land title or leases, which is assumed to be marketable and free of any deed restrictions and easements. Unless noted, it is assumed that there are no encroachments or planning and building violations encumbering the existing structure and / or proposed property. It is assumed that the Properties will be in full compliance with all applicable city, local and private codes, laws, consents, licenses and regulations (including an alcohol license where appropriate), and that all licenses, permits, certificates, franchises and so forth can be freely renewed and/or transferred to a purchaser. All mortgages, liens, encumbrances, lease, servitudes, arrears and penalties have been disregarded unless specified otherwise. No portion of this report may be reproduced in any form without the permission of PT Penilai/Colliers International. PT Penilai/ Colliers International is not required to give testimony or attendance in court by reason of this economic and valuation study without previous arrangements and only when our standard per diem fees and travel costs are paid prior to the appearance. If the reader is making a fiduciary or individual investment decision and has any questions concerning the material contained in this report, it is recommended that the reader contact PT Penilai/ Colliers International.

2.

3. 4. 5.

6. 7. 8.

9.

10. The quality of the Properties on-site management has a direct effect on their economic viability and market value. The financial forecasts presented in this report assume both responsible ownership and competent management. Any variance from this assumption may have a significant impact on the forecast operating results.

E-61

Appendix E

11. Many of the figures presented in this document were generated using sophisticated computer models that make calculations based upon numbers carried out to three or more decimal places. In the interest of simplicity, most numbers presented in this report have been rounded to the nearest tenth. Thus, these figures may be subject to small rounding errors in some cases. 12. Valuing real estate is both a science and an art. Although this valuation employs various mathematical calculations, the final estimate is subjective and may be influenced by the authors experience and other factors not specifically set forth in this report. 13. The relationship between the currency adopted in this report and other major world currencies remains constant as at the date of our fieldwork. 14. Whilst the information contained herein is believed to be correct, it is subject to change. Nothing contained herein is to be construed as a representation or warranty of any kind. 15. Valuation reports for each individual Property are accompanied with their corresponding list of assumptions and limiting conditions, which states assumptions peculiar and pertinent to individual Properties. Interested parties are advised to read the individual reports prior to making any legal, financial or other commitments.

E-62

Appendix F
INDEPENDENT REPORT ON THE INDONESIAN RETAIL PROPERTY MARKET JUNE 2007 Prepared for Board of Directors of Lippo-Mapletree Indonesia Retail Trust Management Ltd (as manager of Lippo-Mapletree Indonesia Retail Trust) and HSBC Institutional Trust Services (as trustee of Lippo-Mapletree Indonesia Retail Trust)

In respect of LIPPO-MAPLETREE INDONESIA RETAIL TRUST FOR AND ON BEHALF OF PT JONES LANG LASALLE

Lucia Rumantir Chairman, Indonesia

F-1

Appendix F

F-2

TABLE OF CONTENTS
REPORT INSTRUCTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . SCOPE OF WORKS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . EXECUTIVE SUMMARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1. OVERVIEW OF INDONESIA AND ITS ECONOMY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.1 REGIONAL CONTEXT AND BACKGROUND . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.2 HISTORICAL BACKGROUND . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.3 POLITICAL BACKGROUND . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.4 SYSTEM OF GOVERNMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.5 ADMINISTRATIVE DIVISIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.6 CURRENT ECONOMIC POLICY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.7 ECONOMIC PERFORMANCE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.8 POPULATION GROWTH AND DEMOGRAPHICS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.9 TOURISM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.10 ECONOMIC OUTLOOK AND IMPLICATIONS FOR THE RETAIL MARKET . . . . . . . . . . . . . . . . . . . . 2. RETAIL MARKET OVERVIEW . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.1 RETAIL SALES GROWTHHISTORICAL AND FORECAST . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.2 CHANGES IN INCOME AND RETAIL SPENDING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.3 CHANGING CONSUMER BEHAVIOUR AND PREFERENCES . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.4 BRAND ACCEPTANCE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.5 NEW RETAIL FORMATS AND RETAILERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.6 RETAIL PROVISION AND PIPELINE OF SHOPPING CENTRES . . . . . . . . . . . . . . . . . . . . . . . . . 2.7 RETAIL SALES PERFORMANCE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.8 SUPPLY CONSTRAINTS AND THE REGULATORY ENVIRONMENT . . . . . . . . . . . . . . . . . . . . . . . . 2.9 RETAIL RENTALS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.10 FUTURE OUTLOOK FOR THE RETAIL SECTOR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3. OVERVIEW OF PORTFOLIO . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.1 REGIONAL CONTEXT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.2 GEOGRAPHIC SPREAD . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.3 SUMMARY OF RETAIL PROPERTIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4. LEASED CENTRES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.1 CIBUBUR JUNCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.2 PLAZA SEMANGGI . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.3 BANDUNG INDAH PLAZA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.4 ISTANA PLAZA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.5 MAL LIPPO CIKARANG . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.6 GAJAH MADA PLAZA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.7 EKALOKASARI PLAZA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5. RETAIL SPACES MALLS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.1 JAVA SUPERMALL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.2 MALANG TOWN SQUARE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.3 GRAND PALLADIUM MEDAN . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.4 METROPOLIS TOWN SQUARE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.5 DEPOK TOWN SQUARE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.6 PLAZA MADIUN . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.7 MALL WTC MATAHARI . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-4 F-4 F-6 F-9 F-9 F-9 F-9 F-10 F-10 F-10 F-11 F-18 F-20 F-21 F-22 F-22 F-23 F-25 F-25 F-26 F-28 F-29 F-31 F-32 F-33 F-34 F-34 F-38 F-44 F-48 F-48 F-57 F-67 F-75 F-83 F-89 F-99 F-107 F-107 F-109 F-112 F-115 F-118 F-120 F-124

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Report instructions
Lippo-Mapletree Indonesia Retail Trust Management Ltd requested that Jones Lang LaSalle provide an overview of the Indonesian retail market with particular reference to subject sites for inclusion in the prospectus to be issued in connection with the initial public offering of units in the Lippo-Mapletree Indonesia Retail Trust (LMIR Trust) and the listing of LMIR Trust in the SGX-ST. SCOPE OF WORKS This report covers the following key issues: Overview of Indonesia and its economy; Overview of the Indonesian retail market, including retail sales growth, emerging trends, retail rentals and future outlook; Summary of the portfolio contained in the LMIR Trust; Market analysis of all leased properties contained in the LMIR Trust; and Market analysis of all retail spaces malls contained in the LMIR Trust. Limitations This retail market commentary has been prepared with reference to specific properties within the LMIR Trust. The analysis is the view of Jones Lang LaSalle Research and Consulting. We confirm that Jones Lang LaSalle received a fee for the preparation and publication of this commentary. Disclaimer Jones Lang LaSalle is not operating under an Australian Financial Services Licence in giving this report. No reference to the report or any part of it may be published in any document, statement or circular or in any communication with third parties without our prior written approval of the form and context in which it will appear. This report has been produced solely as a general guide and does not constitute advice. We have used and relied upon information from sources generally regarded as authoritative and reputable, but the information obtained from these sources may not have been independently verified by Jones Lang LaSalle Research and Consulting. Neither Jones Lang LaSalle nor any of its associates have any other interests (whether pecuniary or not and whether direct or indirect) or any association or relationships with LMIR Trust Management Ltd or any of its associates that might reasonably be expected to be or have been capable of influencing Jones Lang LaSalle in providing this report. We stress that forecasting is a problematical exercise which at best should be regarded as an indicative assessment of possibilities rather than absolute certainties. The process of making forward projections involves assumptions in respect of a considerable number of variables which are acutely sensitive to changing conditions, variations in any one of which may significantly affect the outcome and we draw your attention to this factor. About Jones Lang LaSalle Jones Lang LaSalle is the worlds leading real estate services and money management firm, operating across more than 100 markets around the globe. The company provides comprehensive integrated expertise, including management services, implementation services and investment management services on a local, regional and global level to owners, occupiers and investors. Jones Lang LaSalle has over 45 years experience in Asia Pacific. With over 12,000 employees operating in over 30 markets across the Asia Pacific region, the companys team of experts is uniquely qualified to give the quality advice needed for making quality real estate decisions.
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Report instructions About Jones Lang LaSalle Research and Consulting Jones Lang LaSalle Global Research and Consulting is a multi-disciplinary professional group with core competencies in economics, real estate market analysis and forecasting, locational analysis and investment strategy. The Research and Consulting Group is able to draw on an extensive range and depth of experience from the Companys network of offices, operating across more than 100 key markets worldwide. Our aim is to provide high-level analytical research and consulting services to assist practical decision-making for all investors, owners and occupiers of real estate. The Global Research team comprises of more than 200 professionals and supports the Global Capital Markets and LaSalle Investment Management businesses through the analysis of real estate markets, forecasting of future market conditions and application of these trends for locational decision and investment strategies.

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Executive summary
This report provides an independent review of the Indonesian economy and retail market together with a review and market outlook of each of the subject properties in the LMIR Trust. The key findings of this report are summarised below: INDONESIAN ECONOMY Indonesia is the worlds fourth most populous country, with an estimated population in 2006 of 222 million people. 130 million people live on the island of Java, the worlds most populous island. In 2005, Indonesias gross domestic product (GDP) was US$281 billion, ranking Indonesia as the 26th largest economy in the world. Politically, Indonesia has changed significantly over the past decade from a political system which emphasised consensus, unity and control towards a democracy, with a publicly elected president. Economically, the country has made significant steps towards modernisation, with the liberalisation of the previously restrictive investment rules and a number of economic packages aimed at increasing foreign investment, encouraging development in infrastructure and strengthening the financial sector. Today, Indonesia is the worlds number one exporter of liquefied natural gas (LNG) and the 17th largest oil producer. Its manufacturing sector is now the largest contributor to GDP and international companies are showing interest in locating manufacturing plants in the country, taking advantage of the relaxation of foreign investment rules, Indonesias strategic location and its low-cost employment base. Whilst Indonesia took longer than some other countries to recover from the Asian financial crisis of 1997/98, GDP growth has improved considerably in recent years, from 3.8% in 2001 to 5.5% in 2006. Importantly, this trend is expected to continue, with GDP growth forecast to average 5.8% over the next five years, significantly higher than global economic growth. In terms of purchasing power parity (PPP), Indonesia has recorded strong growth in per capita income (6.9% in 2005). On this basis, income levels in Indonesia are significantly higher than India but remain well below China. Indonesias competitiveness is now much improved with the World Economic Forum ranking it 50th on their Global Competitiveness Scale in 2006, its highest ever ranking. Whilst Indonesia has recorded relatively high inflation over the past two years, the EIU expects inflation to fall to approximately 6% in 2007 and 2008, due in part to the stabilisation of the local currency. Population growth has slowed in the past two decade and is expected to average 1.4% per annum between 2006 and 2010. This lower growth rate should prove positive in the longer term, placing less strain on public services and infrastructure, reducing new entrants to the labour market and leading to higher levels of GDP per capita. Indonesia has a relatively young population with over 80% of the population under 45 years of age. This will see the countrys employment base increase markedly in the short to medium term. Indonesias population is largely concentrated on the island of Java, which accounts for nearly 60% of total population. Urbanisation has been strong, with the population living in cities growing from 22% in 1980 to 46% in 2005. The Greater Jakarta, with an estimated population of 22.3 million, is one of the 10 most populous cities in the world. Economic development in Indonesia has seen a significant increase of the middle income group over the past five years. Such an increase has been a major driver of the retail sector. The middle and upper income groups have increased as a percentage of total households from 50% in 2001 to 64% in 2006, with a higher proportion being within urban areas and on the island of Java. It is estimated that the urban middle income group in Indonesia totals approximately 66 million people.
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Executive summary IMPLICATIONS FOR RETAIL With moderate to strong economic growth forecast over the next five years, the outlook for the Indonesian retail market is positive. Growth in the middle and upper income classes and continuing urbanisation will be prime drivers, providing a critical mass of customers to support modern retailing formats. Furthermore, the shift away from traditional wet markets towards modern shopping malls will continue to support the development of new shopping centres in major urban areas. Retail sales growth has generally been stronger than GDP growth, due to continued increases in domestic consumption as a proportion of GDP . Since the recovery from the Asian financial crisis, nominal retail sales growth has averaged 11% per annum, with a similar rate forecast to continue over the next five years to 2011. In real terms, retail sales are expected to grow by an average of 5.9% per annum between 2007 and 2011. While per capita wealth and retail spending are highest in Jakarta, the strongest growth has been in the urban areas surrounding Jakarta, i.e. Bogor, Depok, Tangerang and Bekasi, the location for a number of the assets within the LMIR Trust portfolio. With the easing of foreign investment regulations, increased urbanisation and the growth of the middle and upper income groups, foreign retailers have successfully entered the Indonesian market. This globalisation of retailing and increased brand acceptance have also been influenced by other factors such as television, international business (expatriates) and tourism (both inwards and outwards). International brands such as Carrefour and Sogo have not only gained strong market acceptance but have influenced the development of domestic operators such as Matahari and Hypermart. Furthermore, the Indonesian consumer has shown increased preference for shopping at modern centres rather than at traditional wet markets due to more comfortable shopping environment, a more complete range of goods, guaranteed quality of products (food safety and cleanliness), competitive prices, good service, and easier accessibility. This trend is expected to continue. SHOPPING CENTRE PROVISION The opening of the domestic retail industry to global players in 1998 has provided a boost to the development of retail shopping malls in Indonesia, initially in Jakarta but more recently in other cities such as Surabaya, Medan, Bandung and Semarang. The shopping centre boom is set to continue, with 19 proposals potentially entering the market in Jakarta alone over the next three years. In the longer term, smaller urban markets and growing areas within Greater Jakarta (but outside Jakarta Province) may experience greater retail development. In addition, competing development pressures from alternative land uses for scarce but strategically located sites within Jakarta may restrict opportunities in the longer term. FUTURE OUTLOOK FOR RETAIL PROPERTY We consider the outlook for the retail property market in Indonesia to be sound. Economic growth is forecast to pick up over the next five years and the growth in the urban middle and upper income groups will support the retail market. While the supply pipeline is strong, particularly within Jakarta, well maintained, and suitably located centres with an established customer base and strong anchor tenants should continue to perform well. Increased brand acceptance and the growing number of national and international retailers should provide a steady supply of sought-after anchor and specialty tenants for existing and new retail centres. Expansion into urban areas outside of the Greater Jakarta is expected, in line with the increase in middle and upper income households in these markets. LIPPO-MAPLETREE INDONESIA RETAIL TRUST The majority of LMIR Trusts properties are within Greater Jakarta, with other properties being located in major cities in Java and North Sumatra.
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Executive summary The seven leased malls and seven retail spaces are located across six provinces, five of which are in Java (Jakarta, West Java, East Java, Central Java, Banten) and one in North Sumatra. The leased malls are fully contained within LMIR Trust while the retail spaces (most of which are strata properties) constitute only part of the total mall (generally as the anchor tenants). Three of the leased malls are within Jakarta, which has the highest level of gross regional domestic product (GRDP) per capita of all provinces in Indonesia, reflecting its role as the administrative and financial capital of Indonesia. Two leased malls and three retail spaces are in Greater Jakarta. This region has experienced the strongest per capita growth in household expenditure of all major urban areas between 2001 and 2005. The remaining two leased malls and four retail spaces are located outside Greater Jakarta. Total net lettable area of the properties within the portfolio as at 30 June 2007 is as follows: Seven leased malls: 219,382 square metres (sq.m) (241,932 sq.m following extension) Seven retail spaces: 94,070 sq.m Over the next five years, shopping centres are expected to experience increased competition, as new centres commence operations and existing centres are re-positioned. On balance, however, the subject malls are well located, with sound tenancy mixes and strategies in place to maintain and potentially increase market share.

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Overview of Indonesia and its Economy 1. OVERVIEW OF INDONESIA AND ITS ECONOMY 1.1 Regional context and background Indonesia is the worlds largest archipelagic country with approximately 17,508 islands scattered around the equator. Its strategic location between Asia and Australia has historically influenced its culture, society, politics and economy. Indonesia is the worlds fourth most populous country after China, India and the USA and has the largest Muslim population in the world. Over 300 ethnic groups are represented with the largest being the Javanese and Sundanese. Figure 1.1.1 Indonesia

Source: maps by Rei-artur (http://commons.wikimedia.org/wiki/User:Rei-artur) The five main islands of Indonesia are Java, Sumatra, Kalimantan (the Indonesian part of Borneo), New Guinea (shared with Papua New Guinea) and Sulawesi. The capital, Jakarta, is on the island of Java and is the nations largest city, followed by Surabaya, Bandung, Medan and Semarang. At the time of the 2000 National Census, the population of Indonesia was 206 million people. This had risen to approximately 222 million people by 2006. 130 million people live on the island of Java, the worlds most populous island. 1.2 Historical background From the early centuries, the Indonesian archipelago has been a major destination for trading, beginning with trade in spices when Chinese merchants first landed in Sumatra. Indonesias history has since been shaped by foreigners attracted to the archipelago by its rich and abundant natural resources. These included Indians, Muslim traders from the Arabic and Persian lands, and Europeans, particularly the Dutch. After three centuries of Dutch rule and over three years of Japanese occupation, Indonesia declared its independence on August 17th, 1945. Independence was formally recognised by the Hague Convention some four years later on December 27th, 1949. 1.3 Political background Under the regime of President Suharto, Indonesia was under a political system which emphasised consensus, unity and controlled authority. For 30 years, the Golkar Party, led by Suharto, had the majority in both the legislative and executive bodies. This came to an end in 1998 when Suharto stepped down as President. Since 1998 Indonesia has hosted two general elections. In 1999, the country appointed Abdurrahman Wahid from Partai Kebangkitan Bangsa (PKB) as its fourth President. He was removed as President by the parliament and was replaced by Megawati Sukarnoputri, the Vice President, who was also the leader of Partai Demokrat Indonesia Perjuangan (PDIP). Three years later, in April 2004, Indonesia hosted its first direct presidential election. Although Golkar won more seats than any other party, and PDIP came in second, the candidate from Partai Demokrat (PD),
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Overview of Indonesia and its Economy retired army general, Susilo Bambang Yudhoyono (SBY), was elected President. Jusuf Kalla (JK) from Golkar was elected Vice President. 1.4 System of government Indonesia is a republic with a presidential system. Being a unitary state, executive power resides with the central government. Since 2001 new laws on regional autonomy have been introduced to promote decentralisation, as requested by provincial administrations. As head of state, the President of Indonesia also serves as the commander-in-chief of the Indonesian armed forces and is responsible for domestic governance, policy-making and foreign affairs. He is supported by the Vice President and a council of Ministers. The President is elected for a maximum of two consecutive five-year periods. On the legislative front, the Peoples Consultative Assembly (MPR or Majelis Permusyawaratan Rakyat) stands as the highest representative body at the national level. Its main roles include supporting and amending the constitution, inauguration of the President and the setting of broad outlines of state policy (GBHN or Garis-garis Besar Haluan Negara). MPR contains two lower Houses of Representativesthe Peoples Representative Council (DPR or Dewan Perwakilan Rakyat) and the Regional Representatives Council (DPD or Dewan Perwakilan Daerah). The DPR is the legislative institution which passes state laws and monitors the executive body (i.e. the government). Members of the DPR are elected for five year terms and selection is based on proportionate representation of more than two thousand electoral districts. The Indonesian judicial system comprises a hierarchical system of courts, the highest being the Supreme Court. Most civil disputes appear first before a State Court. Final appeals are heard and case reviews are conducted by the Supreme Court. A Commercial Court handles cases such as bankruptcy and liquidation. Other court systems recognised by the country are: State Administrative Courthears administrative law cases against the government; Constitutional Courthears disputes concerning legality of law products, general elections, dissolution of political parties and the capacity of a state institution; and Religious Courtdeals with specific religious cases, particularly marriages. 1.5 Administrative divisions Indonesia currently has 33 provinces. These comprise 27 typical provinces, two special regions (Daerah Istimewa i.e. Aceh and Yogyakarta) and one special capital city region (Daerah Khusus Ibukota i.e. Jakarta). Each province is headed by a Governor. Provinces (the first administrative level or Dati I) in Indonesia are divided into Regencies (kabupaten) in rural areas or Municipalities (kotamadya) in urban areas. Regencies and Municipalities (the second administrative level or Dati II) are further divided into Subdistricts (kecamatan). The lowest level in the administrative hierarchy is the Village (desa) in rural areas or the Neighbourhood (kelurahan) in urban areas. Legislation at the provincial level is handled by parliaments from Dati I and Dati II. Governors, mayors and regents must be directly elected by the people and this has been effectively implemented since 2004. 1.6 Current economic policy Indonesia has seen considerable economic growth over the past 40 years. Initially a country largely dependent on agriculture, it is now one of the major emerging markets in the region. Today, Indonesia is the worlds largest exporter of liquefied natural gas (LNG) and the 17th largest oil producer in the world, responsible for about 1.8% of global production (as at 2004). A number of economic packages have been launched, aimed at increasing foreign investment, encouraging infrastructure development and strengthening the financial sector. Recent economic trends have been positive. Domestic consumption has been steadily increasing, the currency has been strengthening with reduced volatility and there has been stable economic growth.
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Overview of Indonesia and its Economy 1.7 Economic performance 1.7.1 Size of the economy In 2005, Indonesias GDP was US$281 billion, ranking Indonesia as the 26th largest economy in the world. Per capita GDP at PPP was US$4,458, placing Indonesia 110th in the world. The industrial sector accounted for 45.8% of GDP , followed by services (40.8%) and agriculture (13.4%) The agricultural sector is the countrys largest employer, providing jobs for 44.3% of the 95 million-strong workforce, followed by the services sector (36.9%) and the industrial sector (18.8%). Table 1.7.1 Key economic indicators, 2005
Indicators Indonesia Malaysia India Thailand China

Nominal GDP (US$ bn) . . . . . . . . . . Current-account balance (US$ bn) . . Current-account balance (% GDP) . . Exports of goods fob (US$ billion) . . Imports of goods fob (US$ billion) . . External debt (US$ billion) . . . . . . . . Debt-service ratio, paid (%) . . . . . . .

.. .. .. .. .. .. ..

. . . . . . .

.. .. .. .. .. .. ..

.. .. .. .. .. .. ..

.. .. .. .. .. .. ..

. . . . . . .

281.3 2.6 0.9 83.2 (61.8) 135.0 14.2

130.6 14.1 10.8 141.8 (115.5) 52.0 4.8

797.8 (12.9) (1.6) 98.1 (149.8) 125.5 9.2

176.6 (3.7) (2.1) 109.3 (106) 52.5 8.6

2,224.9 160.8 7.2 762.5 (628.3) 252.8 5.2

Source: Economist Intelligence Unit, Country Data plantation 1.7.2 Economic base Historically, agriculture (including crop plantations, animal husbandry, fishing and forestry) has been the dominant sector in terms of both employment and economic output. Indonesias main agricultural products include palm oil, rice, tea, coffee, spices and rubber. In addition, the country has abundant mineral resources. The mining sector has therefore been as important souce of income for the country. Indonesia is considered a major oil producer and is South East Asias only member of the Organisation of the Petroleum Exporting Countries (OPEC). The industrial or manufacturing sector emerged in the late 1970s and surpassed the agricultural sector in GDP contribution in the mid 1980s. Between 1995 and 1997, the industrial sector replaced the services sector as the major contributor to GDP . Key sub-sectors include consumer goods products, textiles, apparel and car manufacturing. The services sector has continued to grow over the past five years, supported by growth in tourism, as well as growth in the retail and financial sectors. Table 1.7.2 GDP by industrial origin, 2000-2005 current prices (in billions Rupiah)
2000 2001 2002 2003 2004 2005

GDP by industrial origin . . . . . Agriculture . . . . . . . . . . . . . . . . Mining . . . . . . . . . . . . . . . . . . . Manufacturing . . . . . . . . . . . . . Electricity, gas & water . . . . . . . Construction . . . . . . . . . . . . . . . Trade . . . . . . . . . . . . . . . . . . . . Transport & communications . . . Finance . . . . . . . . . . . . . . . . . . Public administration. . . . . . . . . Other . . . . . . . . . . . . . . . . . . . . Net factor income from abroad . Gross National Product (GNP) .

. 1,389,770 1,684,280 1,863,275 2,045,853 2,273,142 2,729,708 . 216,831 263,328 298,877 325,654 331,553 365,560 . 167,692 182,008 161,024 169,536 196,112 285,087 . 385,598 506,320 553,747 590,051 639,655 765,967 . 8,394 10,855 15,392 19,541 22,067 24,993 . 76,573 89,299 101,574 112,571 143,052 173,441 . 224,452 267,656 314,647 337,840 369,361 429,944 . 65,012 77,188 97,970 118,267 142,292 180,969 . 115,463 135,370 154,442 174,324 194,429 228,108 . 69,461 81,851 84,729 102,507 121,129 135,133 . 60,294 70,407 80,874 95,562 113,491 140,508 . (92,162) (61,051) (54,513) (79,629) (78,414) (85,355) . 1,297,608 1,623,229 1,808,762 1,966,225 2,194,728 2,644,354

Source: Asian Development Bank, Key Indicators, 2006

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Overview of Indonesia and its Economy 1.7.3 Economic growthhistorical and forecast Indonesia has been known for its vest oil reserves and the Government has placed great importance on managing this resource. During the 1970s, Indonesia benefited from rising oil prices and this resulted in large export revenues for the country. From 1968 to 1981, Indonesias GDP grew steadily. However, growth slowed subsequently in 1987 as a result of declining oil prices. Indonesia at this time was heavily dependant on oil revenues and this was compounded by inefficiencies due to over-regulation. The Government began eliminating regulatory obstacles in order to stimulate growth in the non-oil export sector, which resulted in a steady increase in GDP growth from 1987 to 1997. Economic growth was particularly strong from the early to mid 1990s. However, when the Asian financial crisis hit the region in 1997, Indonesias economy suffered dramatically. In 1998, Indonesias GDP contracted by 13.7% and unemployment rose to 15-20%. The economy began to recover in the late 1990s, albeit slower than some other economies in the region. The country has since stabilised its banking sector and taken steps to stimulate growth and investment, particularly in infrastructure. Indonesias GDP has since grown from 3.8% in 2001 to 5.5% in 2006. Table 1.7.3 GDP growth, 2000-2006
GDP growth (%) Country 2000 2001 2002 2003 2004 2005 2006

Brunei . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . China . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . India* . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Indonesia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Malaysia. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Philippines . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Singapore. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Thailand . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Vietnam . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . .

2.8 8.0 4.4 4.9 8.9 4.4 10.0 4.8 6.8

3.0 7.5 5.8 3.8 0.3 1.8 (2.3) 2.2 6.9

2.8 8.3 3.8 4.4 4.4 4.5 4.0 5.3 7.1

3.8 9.5 8.5 4.7 5.4 4.5 2.9 7.0 7.3

1.7 9.5 7.5 5.1 7.1 6.0 8.7 6.2 7.8

3.6 9.9 8.4 5.6 5.3 5.1 6.6 4.5 8.4

n/a 10.7 9.2 5.5 5.9 5.4 7.9 5.0 8.2

Source: Asian Development Bank (ADO 2006) & Jones Lang LaSalle Research *) Data for real GDP is based on constant factor cost Note: Thailand GDP for 2006 is preliminary data According to the Economist Intelligence Unit (EIU), real GDP growth in Indonesia is expected to accelerate to 6% in 2007 with interest rates and inflation expected to fall, and measures to improve the business environment and encourage investment beginning to take effect. New policy packages on infrastructure and the financial sector are also expected to facilitate greater private sector investments in the years to come. The EIU also expects exports to continue to grow, albeit at slower rates than the 12% growth in 2006. Weaker forecast economic growth in Indonesias main export markets should be partially offset by strong growth in China and the acceleration in manufacturing exports, particularly textiles and footwear. Stronger investment demand, together with rising private consumption and exports, will lead to higher demand for imports. As a result, the current account surplus growth will likely fall in 2007 and remain flat in 2008.

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Overview of Indonesia and its Economy Table 1.7.4 Indonesia GDP, 2002-2011
Real GDP (constant price) Trillion Rp. Annual growth

Year

2002(a) . 2003(a) . 2004(a) . 2005(a) . 2006(a) . 2007(f) . 2008(f) . 2009(f) . 2010(f) . 2011(f) .

. . . . . . . . . .

. . . . . . . . . .

. . . . . . . . . .

. . . . . . . . . .

. . . . . . . . . .

. . . . . . . . . .

. . . . . . . . . .

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. . . . . . . . . .

. . . . . . . . . .

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. . . . . . . . . .

. . . . . . . . . .

. . . . . . . . . .

. . . . . . . . . .

. . . . . . . . . .

. . . . . . . . . .

. . . . . . . . . .

. . . . . . . . . .

. . . . . . . . . .

. . . . . . . . . .

. . . . . . . . . .

. . . . . . . . . .

. . . . . . . . . .

. . . . . . . . . .

. . . . . . . . . .

. . . . . . . . . .

. . . . . . . . . .

. . . . . . . . . .

. . . . . . . . . .

. . . . . . . . . .

. . . . . . . . . .

. . . . . . . . . .

. . . . . . . . . .

. . . . . . . . . .

. . . . . . . . . .

. . . . . . . . . .

. . . . . . . . . .

. . . . . . . . . .

. . . . . . . . . .

. . . . . . . . . .

. . . . . . . . . .

. . . . . . . . . .

. . . . . . . . . .

. . . . . . . . . .

. . . . . . . . . .

. . . . . . . . . .

. . . . . . . . . .

. . . . . . . . . .

. . . . . . . . . .

. . . . . . . . . .

. . . . . . . . . .

1,506.10 1,577.20 1,656.80 1,749.50 1,843.80 1,953.70 2,073.60 2,185.40 2,305.90 2,443.00

4.7% 5.0% 5.6% 5.4% 6.0% 6.1% 5.4% 5.5% 5.9%

a = Actual f = Forecast Source: Economist Intelligence Unit, Country Forecast, February 2007 Table 1.7.5 Indonesia forecast overview, 2007-2011
Key indicator 2007 2008 2009 2010 2011

Real GDP growth (%) . . . . . . . . . . . . Consumer price inflation (av;%) . . . . . Budget balance (% of GDP) . . . . . . . . Current-account balance (% of GDP) . Deposit rate (av;%) . . . . . . . . . . . . . . Exchange rate Rp.:US$ (av). . . . . . . . Exchange rate Rp.:100 (av) . . . . . . .

. . . . . . .

.. .. .. .. .. .. ..

.. .. .. .. .. .. ..

.. .. .. .. .. .. ..

.. .. .. .. .. .. ..

.. .. .. .. .. .. ..

.. .. .. .. .. .. ..

6.0 6.9 (0.9) 1.4 10.3 9,212 8,063

6.1 6.1 (0.6) 1.0 9.1 9,422 9,446

5.4 6.2 (1.0) 0.7 9.6 9,601 10,027

5.5 5.1 (0.9) 0.5 9.1 9,640 10,310

5.9 5.1 (1.2) 0.4 9.0 9,703 10,570

Source: Economist Intelligence Unit, Country Forecast, February 2007 1.7.4 Private consumption expenditure growth Similar to other South East Asian countries, strong domestic demand has become the dominant growth factor in Indonesia over the last few years. Since the financial crisis in 1997, private consumption has remained the principal driver of Indonesias economic growth. Prior to the crisis, private consumption contributed approximately 60% of total GDP . Between 2002 and 2005, the proportion of private consumption expenditure increased to approximately 65% of total GDP . Over the last five years private consumption (at constant prices) rose at a rate of 4% per annum.

F-13

Overview of Indonesia and its Economy Figure 1.7.1: Private consumption (current prices), 2000-2005
2,000 1,800 1,600 1,400 Trillion Rp 1,200 1,000 800 600 400 200 0
2000 2001 2002 2003 2004 2005

Private Consumption Growth

25% 20% 15% 10% 5% 0% Percentage Growth

Year

Source: Central Statistics Bureau In nominal terms, private consumption expenditure in 2005 totalled approximately Rp. 1,786 trillion (current prices) compared to Rp. 1,533 trillion the previous year. The following table details Indonesias GDP from 2001 to 2005 based on expenditure and its proportion of total GDP . Table 1.7.6 GDP by expenditureIndonesia, 2000-2005 Indonesia current prices (in billions rupiah)
2000 2001 2002 2003 2004 2005

Expenditure . . . . . . . . . . . . . . . . Private consumption . . . . . . . . . . Government consumption . . . . . . Gross fixed capital formation . . . . Increase in stocks . . . . . . . . . . . . Exports of goods & services. . . . . Less: Imports goods & services . . Statistical discrepancy . . . . . . . . . Percentage of GDP Private consumption . . . . . . . . . . Government consumption . . . . . . Gross domestic capital formation . Exports of goods & services. . . . . Imports goods & services. . . . . . .

. 1,389,770 1,684,280 1,863,275 2,045,853 2,273,142 2,729,708 . 856,798 1,039,655 1,231,965 1,372,078 1,532,888 1,785,596 . 90,780 113,416 132,219 163,701 191,056 224,981 . 275,881 323,875 353,967 392,789 492,850 599,795 . 33,283 47,194 35,980 122,682 34,515 7,172 . 569,490 642,595 595,514 613,721 729,321 915,610 . 423,318 506,426 480,815 462,941 623,525 797,276 . (13,145) 23,972 (5,554) (156,176) (83,963) (6,170) . . . . . 61.7 6.5 22.2 41.0 30.5 61.7 6.7 22.0 38.2 30.1 66.1 7.1 20.9 32.0 25.8 67.4 8.0 25.3 30.1 22.7 67.4 8.4 23.2 32.1 27.4 65.4 8.2 22.2 33.5 29.2

Source: Asian Development Bank, Key Indicators, 2006 1.7.5 Per capita income growth During the oil boom in the 1970s, Indonesias GDP per capita increased from US$80 in 1970 to US$520 in 1980, representing an increase of more than 500%. However, growth fell sharply throughout the 1980s to 21%, improving to 25% in the following decade. The 1997 financial crisis had significantly reduced Indonesias purchasing power. However, the economic recovery in 2002, Indonesias purchasing power returned to pre-crisis levels. According to data from Central Statistics Bureau, per capita gross national income (GNI) grew by an average of 16% per annum in Rupiah terms across 2001-2006.

F-14

Overview of Indonesia and its Economy Figure 1.7.2: GNI per capita (current prices), 2000-2005
16.0 14.0 12.0 Million Rp 10.0 8.0 6.0 4.0 2.0 0.0
2000 2001 2002 2003 2004 2005 2006

Per Capita GNI Growth

35% 30% 25% 20% 15% 10% 5% 0% Percentage Growth

Year

Source: Central Statistics Bureau Compared with other countries in the region, Indonesia recorded the strongest growth between 2000 and 2005 in GNI per capita. Below is the comparison of Indonesias GNI per capita against various Asian economies, using the Atlas Method. The Atlas method smoothens exchange rate fluctuations by using three-year moving averages and price-adjusted conversion factors. Table 1.7.7 Indonesia and selected Asian countries GNI per capita, 2000-2005 current prices (in US dollars)
Country 2000 2001 2002 2003 2004 2005 5-year growth

China . . . . . . . . . . . . . . . . . . . India . . . . . . . . . . . . . . . . . . . . Indonesia . . . . . . . . . . . . . . . . Malaysia . . . . . . . . . . . . . . . . . Philippines . . . . . . . . . . . . . . . . Singapore . . . . . . . . . . . . . . . . Thailand . . . . . . . . . . . . . . . . . Vietnam . . . . . . . . . . . . . . . . . .

. . . . . . . .

930 450 590 3,430 1,040 23,030 1,990 380

1,000 460 740 3,460 1,080 21,260 1,950 410

1,100 470 830 3,600 1,050 20,820 1,970 430

1,270 530 940 3,940 1,100 21,890 2,150 470

1,500 620 1,140 4,520 1,170 24,760 2,490 540

1,740 87.1% 720 60.0% 1,280 116.9% 4,960 44.6% 1,300 25.0% 27,490 19.4% 2,750 38.2% 620 63.2%

Based on World Bank Atlas, data are converted from national currency to US$ using the average nominal exchange rate for the year. Source: World Bank, World Development Indicators, 2006 However, in order to obtain a like-for-like comparison of various economies, a purchasing power parity (PPP) approach is commonly used. PPP conversion takes into account differences in the prices of goods and services, particularly non-tradables, and thereby provides a more accurate measure of the real value of output produced by an economy, compared to other economies. Using the PPP method, Indonesias growth is below Chinas and Indias.

F-15

Overview of Indonesia and its Economy Table 1.7.8 Indonesia and selected Asian countries GNI per capita
GNI per capita Atlas method Current US dollars Country 2000 2001 YoY growth GNI per capita PPP International dollars 2004 2005 YoY growth

China . . . . . . . . . . . . . . . . . . . . . . . India . . . . . . . . . . . . . . . . . . . . . . . Indonesia . . . . . . . . . . . . . . . . . . . Malaysia . . . . . . . . . . . . . . . . . . . . Philippines . . . . . . . . . . . . . . . . . . . Singapore . . . . . . . . . . . . . . . . . . . Thailand . . . . . . . . . . . . . . . . . . . . . Vietnam . . . . . . . . . . . . . . . . . . . . .

1,500 620 1,140 4,520 1,170 24,760 2,490 540

1,740 720 1,280 4,960 1,300 27,490 2,750 620

16.0% 16.1% 12.3% 9.7% 11.1% 11.0% 10.4% 14.8%

5,890 3,120 3,480 9,720 4,950 27,370 7,930 2,700

6,600 3,460 3,720 10,320 5,300 29,780 8,440 3,010

12.1% 10.9% 6.9% 6.2% 7.1% 8.8% 6.4% 11.5%

In current US dollars (Atlas) versus international dollars (PPP). The international dollar is a hypothetical unit of currency that has the same purchasing power that the U.S. dollar has in the United States at a given point in time. Source: World Bank, World Development Indicators, 2006 1.7.6 Competitiveness In 2006, Indonesia was ranked 50th on the World Economic Forums competitiveness scale, the highest rank it has ever achieved and a marked improvement from 2005, when it ranked 69th. The successful achievements during 2006 were primarily driven by greater confidence in the new administration led by SBY and JK, easier access to bank loans, decreased in lobying power of business groups and a more effective anti-trust policy. The following table is the World Economic Forums Global Competitive Indexes (GCI) for selected Asian economies. While Indonesia may still have considerable ground to make up on some of the more developed countries in the region, the improvement over the past year has been very positive. Table 1.7.9 Global competitiveness index (GCI), 2006
GCI Country 2006 Rank 2006 Score 2005 Rank Changes 2005-2006

Taiwan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . South Korea . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Malaysia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Thailand . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . India . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Indonesia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . China . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Philippines . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Vietnam . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Source: World Economic Forum, 2006 1.7.7 Interest rates

. . . . . . . . .

13 24 26 35 43 50 54 71 77

5.41 5.13 5.11 4.58 4.44 4.26 4.24 4.00 3.89

8 19 25 33 45 69 48 73 74

D D D D B B D B D

(5) (5) (1) (2) 2 19 (6) 2 (3)

Interest rates in Indonesia are among the highest in the region, which ultimately impact foreign investments and consumer spending. However, anecdotal evidence suggests that the impact of a high interest rate environment is felt more strongly in the middle-lower and lower income group (or the mass market) rather than in the higher income group. The middle to upper class group in Indonesia is relatively resilient to the increase in interest rates due to their lower dependency on bank loans. This can be seen in the residential property market where a large portion of the buyers in the middle to upper income group prefers to buy houses or condominiums in cash, rather than through a credit loan from the bank.
F-16

Overview of Indonesia and its Economy In an effort to generate business activity, the Indonesian government reduced the benchmark interest rate of the one-month Central Bank Promissory Notes (or SBI) progressively in 2002. As a result, the SBI rate stood at an historical low in 2004 of around 7%. Despite the positive impact this had on consumption growth and related sectors, the decline in the benchmark interest rate did not lead to similar drops in bank lending rates. In 2005, the government decided to adjust the SBI rate to above 13% in order to support the Rupiah. While this was reasonably effective, it placed greater burdens on the business environment. Declining inflation through 2006 and a more stable local currency saw the SBI rate decline to around 10% by the end of 2006. Prime lending rates, however, remained at around 15%. Based on EIUs forecasts, interest rates are expected to decline over the course of 2007, albeit at a slower rate than in 2006. Indonesias benchmark interest rate was lowered by 25 basis point to 9.5% in January 2007. The scope for a confirmed lowering of interest rates in 2007 will be constrained by a narrowing differential with rates in OECD countries. Figure 1.7.3: Benchmark interest rate growth, 2001-2006
20.0 18.0 16.0 14.0 Percentage 12.0 10.0 8.0 6.0 4.0 2.0 0.0
Jan-01 Sep-01 May-02 Jan-03 Sep-03 May-04 Jan-05 Sep-05 May-06

Prime Lending Rate 1-Month Time Deposit Rate 1-Month SBI Rate

Date

Source: Bank Indonesia 1.7.8 Exchange rates Rising domestic interest rates and a declining inflation gap in the early 1990s encouraged strong inflows of foreign capital to the country. This was followed by an appreciation of the Rupiah in 1996. Unfortunately, this was short-lived as political events in the subsequent years caused investors to reassess Indonesias political risks. The Asian financial crisis orginated in Thailand and spread across South East Asia. This exacerbated concerns over political instability in Indonesia and destabilised the Rupiah. Since the crisis, the Rupiah has stabilised and it continued to strengthen in 2006, ending 2006 at an exchange rate of Rp. 9,020 per US$1. Table 1.7.10 Indonesian Rupiah exchange rate against the US dollar (middle rate, end-of-period)
Year Rp./US$ Year Rp./US$

1991 1992 1993 1994 1995 1996 1997 1998 Source: Bank Indonesia, 2006

1,992 2,062 2,110 2,200 2,308 2,383 4,650 8,025

1999 2000 2001 2002 2003 2004 2005 2006

7,100 9,595 10,400 8,940 8,465 9,290 9,830 9,020

F-17

Overview of Indonesia and its Economy Looking ahead, the EIU expects the nominal Rupiah exchange rate will weaken marginally to an average of Rp. 9,212 in 2007, with a further decline to Rp. 9,422 in 2008. In real terms, the Rupiah is expected to be fairly stable against the US dollar in 2007-08. The Rupiah will remain exposed to the risk of volatility during the EIUs forecast period, as large inflows of foreign portfolio funds in 2006 have left the Rupiah vulnerable to short-term perceptions of political risk. 1.7.9 Inflation Inflation in Indonesia remains relatively high compared to other South East Asian economies. A major contributing factor in the past two years has been the sharp rise in energy prices. The crisis in 1997 led to severe inflation in 1998 and 1999, driven by the collapse of the Rupiah and the rapid movement of money supply to the banking sector. However, in 1999, the return of macroeconomic stability, together with subdued economic growth, reduced inflation to around 2%, which at around 9% in the following five years. The governments decision to increase fuel prices by an average of 125% in October 2005 caused inflation to increase significantly to 17%. Inflation improved to 7% in 2006. Below is the comparison table of average annual inflation between Indonesia and selected Asian countries. Table 1.7.11 Consumer price inflation, 1996-2006 average annual% growth
Country 96 97 98 99 00 01 02 03 04 05 06

Brunei . . . . . . . . . . . . China . . . . . . . . . . . . India . . . . . . . . . . . . . Indonesia . . . . . . . . . Malaysia . . . . . . . . . . Pakistan . . . . . . . . . . Philippines. . . . . . . . . Thailand . . . . . . . . . . Vietnam . . . . . . . . . .

. 2.0 . 8.3 . 8.8 . 7.0 . 3.5 . 10.8 . 9.1 . 5.9 . 5.7

1.7 2.8 7.4 6.2 2.6 11.8 5.9 5.6 3.2

(0.4) (0.8) 13.2 58.0 5.1 7.8 9.7 8.1 7.7

0.0 (1.4) 4.7 20.7 2.8 5.7 6.4 0.3 4.2

1.2 0.4 3.9 3.8 1.6 3.6 4.0 1.6 (1.6)

0.6 0.7 3.7 11.5 1.4 4.4 6.8 1.7 (0.4)

(2.3) (0.8) 4.5 11.8 1.8 2.5 2.9 0.6 4.0

0.3 1.2 3.7 6.8 1.1 3.1 3.5 1.8 3.2

0.9 3.9 3.9 6.1 1.4 4.6 6.0 2.8 7.7

1.1 1.8 4.0 10.5 3.0 9.3 7.6 4.5 8.2

0.5 1.5 5.6 13.0 3.8 7.9 6.7 4.9 7.6

Source: World Bank, World Development Indicators, 2006 Note: data for Indonesia refers to urban areas/selected cities only Stable international oil prices and a relatively strong Rupiah are expected to help contain inflationary pressures in 2007, despite stronger economic growth. As a result, the EIU has forecast CPI will average 6.9% in 2007 and 6.1% in 2008. Drought and an import ban may place upward pressure on rice prices in 2007. Wage pressures in 2007-08 should be subdued, given relatively high unemployment and easing inflationary pressures. 1.8 Population growth and demographics 1.8.1 Population growth Indonesia is the fourth most populous country in the world after China, India and the USA. The 2000 Census recorded the population at 201 million, with the Central Bureau of Statistics (BPS) estimating that the population had risen to 222 million in 2006. Population growth has slowed considerably, averaging 1.5% per annum throughout the 1990s, a result of successful family planning programs that have substantially reduced the fertility rate. About 95% of the population is of Malay origin, with over 300 minority groupings, including the Melanesians, Polynesians and Micronesians as well as the estimated 4 million of ethnic Chinese. The most common religion practiced is Islam (87%), followed by Christianity (10%), Hinduism (2% mainly in Bali) and Buddhism (1%). The gender profile of Indonesia is well balanced, with approximately 101 million males and 100 million females based on the 2000 National Census. Most of the population was classified as of working-age (between 15-64 years old). However, among the working-age population, the majority were aged between 15 and 45 years, accounting for over 51% of Indonesias total population. Combined with 30% of the
F-18

Overview of Indonesia and its Economy population aged under 15 years of age, the country has a huge pool of human resources to draw upon in the short to medium term. Table 1.8.1 Indonesiapopulation by gender and age, 2000
Age group Male Female Total % of total

0-15 . 15-25 25-45 45-65 65+ . . Total .

. . . . . .

.. .. .. .. .. ..

.. .. .. .. .. ..

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

.. .. .. .. .. ..

.. .. .. .. .. ..

.. .. .. .. .. ..

.. .. .. .. .. ..

. . . . . .

.. .. .. .. .. ..

. . . . . .

32,191 20,886 31,201 14,358 4,788 103,424

31,060 21,921 31,210 13,682 4,582 102,455

63,251 42,807 62,411 28,040 9,370 205,879

30.7% 20.8% 30.3% 13.6% 4.6% 100%

Source: Central Bureau of Statistics (BPS), 2000 Census Population growth is forecast to average 1.4% per annum between 2006 and 2010. This lower growth rate should prove positive in the longer term as it places less strain on public services and infrastructure, reduce new entrants to the labour market (currently nearly 2.5 million a year) and eventually facilitate higher levels of GDP per capita. Increased life expectancy, and falling birth and death rates will lead to a steady ageing of the population, and this is expected to change consumption patterns over the long run. Table 1.8.2 Forecast of demographic profile, 2000-2010
Population (m) 2000 2005 2010

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Male . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Female . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Age profile (% of total population)

205.8 103.4 102.4

242 120.8 121.2

258.8 129.2 129.6

0-14 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15-64 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65+ . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Age profile (% of total population)

30.7 64.7 4.6

2000

29.1 65.7 5.2

2005

27.6 66.6 5.8

2010

Young-age dependency ratio . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Old-age dependency ratio . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Working-age population (million) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Urbanisation (% of total) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Labour force (million) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Period averages

0.47 0.07 145.6 41 95.7

0.44 0.08 158.9 47.9 106.5

2001-05

0.41 0.09 172.3 53.2 115.5

2006-10

Population growth (%) . . . . . . . . . . . . . . . . Working-age population growth (%) . . . . . . Labour force growth (%) . . . . . . . . . . . . . . . Crude birth rate (per 1,000) . . . . . . . . . . . . Crude death rate (per 1,000) . . . . . . . . . . . Infant mortality rate (per 1,000 live births) .

.. .. .. .. .. ..

.. .. .. .. .. ..

.. .. .. .. .. ..

.. .. .. .. .. ..

.. .. .. .. .. ..

. . . . . .

.. .. .. .. .. ..

.. .. .. .. .. ..

.. .. .. .. .. ..

.. .. .. .. .. ..

.. .. .. .. .. ..

.. .. .. .. .. ..

.. .. .. .. .. ..

. . . . . .

.. .. .. .. .. ..

1.5 1.8 2.2 20.9 6.7 38.1

1.4 1.6 1.6 19.5 6.1 32.1

Source: Economist Intelligence Unit estimates and forecasts, February 2007, Central Statistics Bureau (BPS), International Labour Organisation (ILO), labour force projections; National Statistics 1.8.2 Distribution Industrial development in Indonesia has resulted in large-scale migration to urban areas. In 2005, 46% of the population were living in cities, compared with 31% in 1990 and 22% in 1980. As a result, the population distribution remains highly uneven. Despite attempts from the government to ease congestion in Java, Bali and Madura through transmigration programs, 61% of Indonesians still live on these three islands, which constitute only around 7% of Indonesias land surface area. In 2004, the population density of Java island stood at an estimated 1,009 people per square kilometre (sq.km), while in Jakarta, the
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Overview of Indonesia and its Economy density is as high as 13,177 people per sq.km. Outside Java and Bali, population density averages less than 100 people per sq.km, with Papua having only seven people per sq.km. 1.8.3 Welfare and poverty Over the last 30 years, Indonesia has made good progress in raising the welfare and standard of living of its poorest citizens. The proportion of the population living below the nationally defined poverty line decreased from 27% in 1999 to 17% in 2004. Progress has also been made against international benchmarks, with only 7.4% (according to 2003 data) of the population living on less than US$1 per day. However, overall income distribution remains highly unequal. Statistics show that some 53% of the population (110 million people) still live on less than US$2 per day. This group suffers from the lack of access to basic services such as water and sanitation, inadequate provision of healthcare and education and remains highly vulnerable to shocks in the economy. Geographically, poverty is concentrated in rural areas and in eastern Indonesia. In 2004, approximately 20% of the rural population lived below the poverty line, compared with 12% of the urban population. Figure 1.8.1: Socio-economic survey* in Indonesia, 2001-2006
100% 90% 80% 70% Percentage 60% 50% 40% 30% 20% 10% 0% 2001 2002 2003 2004 2005 2006 A (Above Rp2 mil/month) B (Rp1.5-2 mil/month) C1 (Rp1.0-1.5 mil/month) C2 (Rp 0.7-1.5 mil/month) D (Rp0.5-0.7 mil/month) E (Below Rp 0.5 mil/month)

Year

* ACNielsen Socio-Economic Survey is based on monthly household expenditure, not actual income. No standard can be used (or widely accepted) to calculate direct relation between expenditure and income Source: ACNielsen Economic development in Indonesia has seen a significant increase of the middle class over the past five years. This middle income group is considered one of the vital contributors to the economy and is perceived as the most prospective target in mass consumer markets. Based on the Social Economic Survey (SES) by ACNielsen conducted in nine major cities in Indonesia, the share of population of the middle income group (classified as SES A, B & C) has steadily grown from 50% in 2001 to 64% in 2006. As such, it is estimated that the urban middle income population in Indonesia totals approximately 66 million people. This particular group is likely to be considered a major target market for modern retail shopping centres. 1.9 Tourism Tourism is an important element of the Indonesian economy and an important source of foreign exchange revenues. Comprising more than 17,000 islands, with the second longest shoreline in the world, 300 different ethnic groups, 250 languages and a year round tropical climate, Indonesia is a major foreign tourist destination. 1.9.1 International tourism International tourism campaigns have focused largely on tropical coastal destinations such as Bali. Cultural tourism is another important aspect of the industry, with the Toraja, Prambanan and Borobudur temples, Yogyakarta and Minangkabau being popular destinations for cultural enthusiasts, who are also attracted to the many Hindu festivities in Bali.
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Overview of Indonesia and its Economy From 1986 to the mid 1990s, the growth of the tourism industry accelerated sharply, as did tourist spending. Aided by a relatively stable socio-economic and political climate, international visitor numbers reached around 5 million per annum. In 2003, international arrivals to Indonesia declined by over 10%, affected by the bombings in Bali in October 2002. However, the number of tourist arrivals in Indonesia recovered in 2004. In 2004 tourist arrivals for holiday purposes accounted for 53% of total arrivals, while business visitors accounted for around 40%. Repeat visits accounted for over 80% of total arrivals, reflecting visitor satisfaction with the country as a destination area, as well as ongoing business commitments in Indonesia. Table 1.9.1 International visitors to Indonesia, 2000-2005growth of arrivals, expenditure & length of stay
International visitors Average expenditure/person Per visit (US$) Per day Average stay in day(s) Foreign exchange income (million US$)

Year

2000 . . 2001 . . 2002 . . 2003 . . 2004 . . 2005 . . Source:

....................... ....................... ....................... ....................... ....................... ....................... Ministry of Culture and Tourism,

5,064,217 1,135.18 5,153,620 1,053.36 5,033,400 893.26 4,467,021 903.74 5,321,165 901.66 5,002,101 904.00 Republic of Indonesia

92.59 100.42 91.29 93.27 95.17 99.86

12.3 10.5 9.8 9.7 9.5 9.1

5,748.8 5,396.3 4,305.6 4,037.0 4,797.9 4,521.9

Increased stability will continue to underpin future tourism growth. 1.10 Economic outlook and implications for the retail market The domestic trade (retail and wholesale) and hotel and restaurant sectors accounted for 15.7% of real GDP in 2005. Growth in these sectors in recent years has been broadly in line with the overall rate of growth in GDP . This trend should continue, leading to strong growth in line with the short-term outlook for the Indonesian economy. The move towards democracy and a more favourable investment environment have resulted in Indonesia heading towards a stronger economic foundation, aimed at regaining its pre-1998 position as one of the Tiger economies of the region. In the longer term, with its vast population, abundant labour and natural resources, Indonesia is well placed to be a future growth economy. Economic growth over the past few years, particularly growth of the middle income group, has opened up considerable opportunities in the retail market and is expected to continue in the future. Drivers of the retail market over the short to medium term include: Population growth Untapped potential markets, both geographic and demographic Growing middle class (more urban population, modern lifestyle) Consumer spending being a predominant component of Indonesias GDP structure Long-term positive economic outlook (the next eleven according to Goldman Sachs 2005 report)

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Retail Market Overview 2. RETAIL MARKET OVERVIEW Over the past five years, the retail market in Indonesia has grown in line with the countrys GDP growth. The steady growth in consumer purchasing power and the implementation of regional autonomy laws have supported the development of the industry, thus providing more opportunities for retailers to expand their businesses into new areas. The relaxation of government policies relating to foreign investment has seen a marked increase in foreign retailers and investors particularly in Jakarta and other large cities such as Surabaya, Medan, Bandung and Denpasar. With the largest population in the South East Asian region and an affluent and growing urban middle class, currently estimated at around 66 million people, Indonesia has significant potential for future retail development and growth. 2.1 Retail sales growthhistorical and forecast The retail sector was the first sector to recover from the economic crisis in 1998, with retail trade increasing by over 60% in 1999. This rapid recovery was driven predominantly by strong domestic consumption, and served also as a primary driver of Indonesias economic growth. Since then, nominal retail sales growth has averaged 11% per annum, with this rate forecast to continue over the next five years (to 2011). The two major drivers are low forecast inflation and interest rates. In real terms, retail sales are expected to grow by an average of 5.9% per annum between 2007 and 2011. Figure 2.1.2: Retail sales (US$M) (current prices), 1994-2011
300,000 250,000 200,000 $USM 150,000 100,000 50,000 0
1994 1996 1998 2000 2002 2004 2006 2008 2010

Historical Retail Sales Forecast Retail Sales Growth

80% 60% 40% % Growth 20% 0% -20% -40% -60% -80%

Year

Source: EIU

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Retail Market Overview Table 2.1.1 Indonesia retail sales (US$ Million) (current price), 1994-2011
Year Retail sales (US$ Million) Annual growth

1994(a) 1995(a) 1996(a) 1997(a) 1998(a) 1999(a) 2000(a) 2001(a) 2002(a) 2003(a) 2004(a) 2005(a) 2006(a) 2007(f) . 2008(f) . 2009(f) . 2010(f) . 2011(f) .

. . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . .

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. . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . .

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. . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . .

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. . . . . . . . . . . . . . . . . .

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. . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . .

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. . . . . . . . . . . . . . . . . .

83,618 96,921 109,130 100,578 45,597 73,216 71,836 70,011 89,908 107,846 114,483 121,013 149,186 167,587 185,141 203,264 224,717 247,935

15.9% 12.6% (7.8)% (54.7)% 60.6% (1.9)% (2.5)% 28.4% 20.0% 6.2% 5.7% 23.3% 12.3% 10.5% 9.8% 10.6% 10.3%

a = Actual f = Forecast Source: Economist Intelligence Unit, Country Forecast, February 2007 2.2 Changes in income and retail spending The recovery in Indonesias economy over the past five years has resulted in strong real income growth, particularly in the nations capital, Jakarta. As mentioned earlier, economic growth has lead to a considerable increase in the number of middle income households, which contributing significantly to retail growth in the country. However, the growth is concentrated in major urban centres, while growth in rural areas and smaller cities still lags that in the urban centres. The following chart shows the GDP per capita comparison of Indonesias five major cities. Figure 2.2.1: GRDP per capita by Indonesian city (current prices), 2003-2005
60 50 40 30 20 10 0
Indonesia Jakarta Bandung Surabaya Semarang Medan

2003 2004 2005

Rp Millions

City
*) Figures for Indonesia, Jakarta & Bandung are for 2003-2005 2005 figures for Surabaya, Semarang and Medan are n/a

Source: Central Bureau of Statistics Jakarta, as the largest city, has the highest GRDP (current prices) per capita with an average growth rate of about 14% per annum over the past four years. It is then followed by Surabaya, Semarang, Medan and Bandung. The GRDP growth rate of selected major cities above ranges from 10% to 15% per annum.
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Retail Market Overview According to BPS, private consumption in 2006 was estimated at Rp. 2,093 trillion, representing 62.7% of total GDP . Private consumption (current prices) growth over the past five years has averaged around 15% per annum, while GDP (current price) growth has averaged 10% per annum. Apart from increases in income, retail spending growth has also been boosted by a lifestyle shift towards a higher level of consumerism. This is particularly the case in major cities such as Jakarta, Surabaya, Bandung, Medan, Makassar and Bali. Furthermore, the growing presence of international retail brands, the expansion of local retail franchises and higher loan disbursements to retail consumers have changed the way people shop and consequently altered their spending pattern. Data from Bank Indonesia indicate that over the past 5-years (from 2001 to 2006), non-property loans have increased at an average of approximately 29% per annum. Jakarta Province holds the largest proportion of such loans, accounting for 37% of the total. Based on ACNielsens surveys, household spending has increased by between 9% and 21% over the past five years in major Indonesia urban markets. Table 2.2.1 Household expenditure in Indonesia 2001-2006
Average annual household expenditure (Rp.) Cities 2001 2006 Total household expenditure (Rp. billions) 2001 2006 Average growth 2001-2006

Jakarta . . . . . . . . . . . . . . . . . . . . . . . . . Botabek . . . . . . . . . . . . . . . . . . . . . . . . . Bandung . . . . . . . . . . . . . . . . . . . . . . . . Surabaya . . . . . . . . . . . . . . . . . . . . . . . . Semarang . . . . . . . . . . . . . . . . . . . . . . . Medan . . . . . . . . . . . . . . . . . . . . . . . . . . Source: ACNielsen Surveys

. . . . . .

10,722,000 6,768,000 10,812,000 10,614,000 9,522,000 11,904,000

17,898,000 12,576,000 17,532,000 15,864,000 15,522,000 17,400,000

19,277 13,699 4,825 7,575 2,690 5,182

35,273 35,979 8,317 11,619 5,554 8,113

12.8% 21.3% 11.5% 8.9% 15.6% 9.4%

The following table provides the household expenditure of middle income group (Social Economic Survey B and C). Table 2.2.2 Household expenditure of the middle class in Indonesia 2001-2006
Total household expenditure of middle class (Rp. billions) Cities 2001 2006

Average growth 2001-2006

Jakarta . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Botabek . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Bandung . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Surabaya . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Semarang. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Medan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Source: ACNielsen Surveys

. . . . . .

10,561 7,493 2,793 4,295 1,758 3,542

17,276 25,817 4,304 6,293 3,691 5,103

10% 28% 9% 8% 16% 8%

Household expenditure of middle income group in the Botabek area, which includes Bogor, Depok, Tangerang and Bekasi, reached the highest average growth level at 28% per annum over the past five years. This high growth was driven mainly by the increase in residential estate development in the perimeter suburbs of Jakarta which increased the number of middle class households in the area. Overall, real retail spending is expected to increase gradually over the next few years in urban areas, while growth is likely to be slower in rural areas.
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Retail Market Overview 2.3 Changing consumer behaviour and preferences The landscape of consumer purchasing patterns has altered dramatically following the 1998/99 economic crisis. A December 2004 report by the USDA Foreign Agricultural Service noted the following changes in consumer behaviour amongst Indonesian consumers: Extremely price conscious in their purchases and exhibiting less store and brand loyalty; Private label growing in acceptance; Younger consumers looking for variety and are less cost conscious; Consumer advertising growing rapidly and affecting decision making; Shopping more frequently for food and buying smaller quantities per shopping trip; Shifting purchases of some staple items to traditional outlets and shopping more frequently at discount venues in modern centres; Increased preference for shopping at the supermarket/modern outlet rather than at traditional wet markets due to more comfortable shopping space, a more complete range of goods, guaranteed quality of products (food safety and cleanliness), competitive price, good service, and easier accessibility. Furthermore, the report also mentioned that the patterns of consumer behaviour described above are expected to continue. Consumers are adjusting to the higher prices paid for imported and local food products, but will remain very selective in their product purchases and will be looking for good quality products at low prices. Promotion will be important as consumers will be more fickle and impressionable, and there will be opportunities to replace traditional brands. Value-for-money will remain important to consumers, but they will also be looking for greater variety. Over time, brand names should again become important to consumers and new product introductions will increase. Offering additional in-store services, which is already a relatively common practice, will become even more widespread. These services include acceptance of credit/debit cards, ATM services, flower departments, laundry counters, food courts, bakery corners and home delivery. Money-back or other guarantees are also expected to become more common. Ready-to-eat and ready-to-cook meals are becoming very popular, particularly for expatriates and middle to upper income consumers. 2.4 Brand acceptance Since the Indonesian government lifted the ban on direct foreign investment in the domestic retail industry in 1998, many foreign retailers have been aggressively expanding their presence in the local market. Prior to that, foreign retailers were required to form joint venture companies with a local partner. Since the new regulations came into force, foreign retailers have been allowed to set up a retail business entity with 100% foreign capital. Pioneers that expanded their presence in Indonesia were Continent and Carrefour, both operating as hypermarkets. These two retailers have since merged and now operate under the Carrefour brand. The positive reception to this format, which offers a more comfortable shopping experience combined with low price tags, has led to other hypermarkets expanding their presence in the country. In 2002, Giant hypermarket, a subsidiary of Dairy Farm, commenced operations, followed by Clubstore which introduced their own hypermarket in 2003. The expansion of hypermarkets had an impact on the way people shop in Indonesia. This is especially evident in major cities, where the hypermarket concept has matured. The expansion of hypermarkets and other modern formats has changed consumer shopping behaviour from purchasing their household necessities in traditional wet markets, to shopping in air-conditioned supermarkets or hypermarkets. In addition, the hypermarket format has been boosted by the aggressive promotion of a number of popular brands. Success in other retail categories followed that of hypermarket. In the department store, Sogo and Metro are considered as leading foreign brands in this segment and are popular among the middle to upper class communities in major cities. This has attracted other brands to expand into Indonesia, such as Debenhams
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Retail Market Overview from the UK in 2004. More recently, Japanese retailer Seibu has confirmed plans to open their first outlet in Jakarta. Increased consumerism, growing expatriate communities (particularly in Jakarta) and changing lifestyle patterns in major urban areas have lead to foreign cafs, restaurants and food operators opening stores. When Starbucks first opened their outlet in Jakarta in 2002, they gained an overwhelming response from both local and expatriate communities in Indonesia. On four years, they have expanded their outlets to around 40 throughout Indonesia. Breadtalk, a bakery chain from Singapore, has also enjoyed a positive reception, growing to 14 outlets in prime shopping malls in Indonesias major cities since, from one in 2003. Other international food and beverage (F&B) chains are enjoying strong growth and acceptance in the local market. Leading brands that were already present in Indonesia before 1998 include McDonalds, Kentucky Fried Chicken and Pizza Hut. These international fast food chains not only have outlets in major cities but have also expanded into smaller cities throughout the country. The leisure and entertainment retailing sector, which includes cinemas, amusement parks, fitness clubs, billiard halls and bowling centres, has witnessed growth in line with the growing middle and upper income groups, and have become particularly popular with young families and the under 25 age groups. Popular destinations in this sector include Timezone, FitnessFirst, Celebrity Fitness and, more recently, Blitz Megaplex from Singapore. Kidzania, a childrens edutainment (education and entertainment) park from Brazil is continuing this trend, having entered into pre-commitments to expand into Jakarta. Increasing media exposure, better education and higher levels of domestic and international travel have provided consumers with knowledge and exposure to major international brands. Coupled with this newly acquired knowledge is the development of new shopping malls in major cities which adopt modern lifestyle concepts. 2.5 New retail formats and retailers The Indonesian retail industry has evolved from traditional markets to modern department stores and shopping malls over the past 30 years. Despite the fact that many Indonesian consumers still purchase daily necessities at traditional markets, they have become more accustomed to shopping in large, modern malls. In most larger cities, particularly in Greater Jakarta, which include the surrounding cities of Bogor, Tangerang, Depok and Bekasi, shopping malls have played a significant role in the development of the countrys modern retail industry. Some of the more prevalent modern retailing formats are described below. 2.5.1 Department store A department store which carries a wide range of merchandise that is organised into separate departments for the purpose of promotion, service and control. This format was first introduced in the 1960s with the launch of the government-run department store, Sarinah. Department store expansion increased in the 1980s with several local privately-owned department stores entering the market. These pioneers include Matahari, Ramayana and Pasaraya, which share overall market dominance with foreign department stores such as Sogo and Metro. The former primarily target the middle and middle-lower income group, while Sogo and Metro cater to the middle-upper and upper class segment. 2.5.2 Supermarkets A large self-service retail market that sells food and grocery items. The supermarket format was introduced in Indonesia in the 1970s with the launch of Hero and Gelael. The growth of supermarkets is concentrated in major metropolitan markets, focusing more on the middle-upper and upper income groups. 2.5.3 Minimarket A mini version of supermarkets offering basic and daily necessities. This concept was initially introduced by foreign retailers, such as Circle K and 7 Eleven, starting in the late 1980s in major cities. However, these
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Retail Market Overview retailers have since focussed on catering to the middle to upper income group in major cities. Conversely, the expansion of local minimarkets has outpaced foreign competitors in terms of outlet growth. This growth is further boosted by franchised businesses which are now more common in Indonesia. Leading retailers such as Indomaret and Alfa have enjoyed strong growth over the past three years, having expanded their presence deeper into smaller cities and neighbourhood areas. The total number of Indomaret and Alfa minimarkets is estimated to have reached over 1,300 outlets each. 2.5.4 Hypermarket A very large commercial establishment that is a combination of a department store and a supermarket. As mentioned earlier, the development of hypermarkets in Indonesia began in 1998 with the opening of Carrefour and Continent. Their foray into the domestic market had a significant impact on the retail scene in Indonesia. With a wide range of goods offered, ample space, complemented by good amenities for customers (i.e. more pay points and parking facilities), along with a commitment to provide the lowest price possible, this format quickly gained acceptance among local consumers. Currently, there are three major retailers competing in this marketCarrefour, Giant and Hypermart. The latter was introduced by the Matahari Group, offering a new concept and flexibility and promoting a more compact hypermarket. 2.5.5 Specialty stores Specialty stores are relatively small retail outlets specialising in a narrow range of merchandise. From the early period of modern retailing in Indonesia, the specialty store format has been the most common form of retail outlet in the market. However, it was dominated by local mom-and-pop retailers. Along with the growth in the domestic retail industry and demand from the middle and upper income group in the 1990s, the specialty store format evolved into a more sophisticated and professionally managed business. Since the recovery from the financial crisis, there has been a steady growth of specialty store chains entering the market, including both local and foreign brands as well as premium brands catering to the upper income groups and foreign tourists. A recent trend is management companies that control the roll-out of major international brands. Key players in this segment include Mahagaya (Mango, Prada, Hugo Boss, Etiene Aigner etc), Club 21 (DKNY) and the publicly-listed Mitra Adi Perkasa, which has exclusive control of the expansion of popular brands ranging from sport apparel such as Reebok, Spalding, Union Bay, Airwalk, fashion brands including Calvin Klein, Marks & Spencer, NEXT, Zara, Top Shop and Top Man, childrens toys such as Bandai, Nikko, Barbie, Disney, OshKosh and cafs and restaurants such as Starbucks, Krispy Kreme and Pizza Marzano. According to ACNielsen, the growth of the above mentioned modern retail formats is outpacing the traditional market, yet the latter still dominates Indonesian retailing with a market share around 66%. This proportion, however, is expected to continue to diminish over time. Figure 2.5.1: Market share of modern and traditional retail, 2006
100 90 80 Percentage Share 70 60 50 40 30 20 10 0 2000 2001 2002 2003 Year 2004 2005 2006* Minimarket Supermarket Traditional Shop

* Notes: Up until June Source: ACNielsen Retail Index 2006

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Retail Market Overview 2.6 Retail provision and pipeline of shopping centres The opening of the domestic retail industry to global players in 1998 has boosted the development of retail shopping malls in Indonesia. In the early post-crisis period (2000-2001), new retail developments were concentrated in Jakarta and its surrounding areas, but more recently other cities such as Surabaya, Medan, Bandung, Semarang, Palembang, Denpasar, Makassar and a number of secondary cities have witnessed shopping centre development. In Greater Jakarta (which includes satellite cities such as Depok, Tangerang, Bekasi and Bogor), there are currently 130 shopping centres with a total stock of approximately 4.1 million sq.m, comprising leased and strata-title retail space. With limited regulations governing where new supply can be established, new centres continue to be built, often as part of mixed use projects and often within close proximity to existing malls. Figure 2.6.1: Retail distribution by area and type
600,000 500,000 400,000 300,000 200,000 100,000 0
CJ SJ NJ WJ EJ BGR BKS DPK TGR

Leased Malls Strata-titled Malls

'000 Sq. m

Location

Source: Jones Lang LaSalle Note: CJ: Central Jakarta; SJ: South Jakarta; NJ: North Jakarta; WJ: West Jakarta; EJ: East Jakarta, BGR: Bogor; BKS: Bekasi; DPK: Depok; TGR: Tangerang In Jakarta, existing shopping malls are concentrated in Central Jakarta, with around 30% of total stock, followed by South and North Jakarta with around 26% and 23% respectively. Existing shopping malls in West and East Jakarta make up around 14% and 8% of total stock respectively. Outside Jakarta, most of the retail stock, about 40%, is concentrated in Tangerang, followed by Bekasi (26%) and Bogor (21%). Retail stock in Depok accounts for approximately 13% of the outer Jakarta stock. Over the next three years, 19 new shopping malls are set to enter the market in Jakarta, with total potential stock of around 960,972 sq.m. Of this total stock, approximately 42% are Upper Grade, 39% are Middle Grade and 19% are Lower Grade. A further eight retail projects outside of Jakarta have been proposed. These are planned for completion by the end of 2008. They will potentially add approximately 234,600 sq.m of retail stock, of which approximately 58% and 42% are Middle Grade and Lower Grade respectively. Table 2.6.1: Proposed retail projects in greater jakarta area A. Within Jakarta
Completion year Name of shopping centre Address Developer Section Net lettable area (sq.m)

2007 . . . . . . . Grand Indonesia 2007 . . . . . . . Citywalk Sudirman 2007 . . . . . . . Pacific Place

Jl. MH Thamrin Jl. KH Mas Mansyur Sudirman CBD

Djarum Group Duta Anggada Realty PT Metropolitan Mulia Persada

Central Business District (CBD) CBD CBD

108,000 17,300 75,000

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Retail Market Overview

Completion year Name of shopping centre Net lettable area (sq.m)

Address

Developer

Section

2007 . . . . . . . Gajah Mada Square 2007 . . . . . . . Pluit Junction 2007 . . . . . . . Mal Kelapa Gading 5 2007 . . . . . . . Jakarta City Center Phase 2 2007 . . . . . . . Retail @ Oakwood Cozmo 2008 . . . . . . . Mall of Indonesia 2008 . . . . . . . Main Street Gandaria 2008 . . . . . . . Seasons City 2008 . . . . . . . Plaza Indonesia Extension 2008 . . . . . . . ITC Pasar Minggu 2008 . . . . . . . Blok M Square 2008 . 2009 . 2009 . 2009 . . . . . . . . . . . . . . . . . . . . . . . . . Kota Kasablanka Kemang Village Emporium Epicentrum Walk

PT Lumbung Artha Nugraha Jl. Raya Pluit Indah Jakarta Propertindo Jl. Blvd Kelapa Gading Summarecon Jl. Kebon Kacang Raya PT Jakarta Realty Mega Kuningan

Jl. Gajah Mada

Gajah Mada Pluit Kelapa Gading Tanah Abang

35,000 23,000 13,000 58,960 5,000 110,000 94,000 40,000 25,386 40,000 80,326 62,000 65,000 63,000 26,200 19,800 960,972

PT Cozmo International CBD Kelapa Gading Kebayoran Grogol CBD Pasar Minggu Blok M CBD Kemang Pluit CBD Glodok

Jl. Blvd Kelapa Gading PT Makmur Jaya Lestari Jl. Sultan Iskandar Pakuwon Muda Jl. Latumenten Podomoro Jl. MH Thamrin Plaza Indonesia Realty Jl. Pasar Minggu Jl. Melawai Raya Jl. Prof Dr Satrio Jl. P . Antasari Jl. Pluit Raya Jl. HR Rasuna Said Jl. Hayam Wuruk Surya Internusa PT Melawai Jaya Realty Pakuwon Lippo Karawaci PT Griya Emas Sejati PT Bakrie Swasakti Utama Duta Anggada Realty

2009 . . . . . . . Galeria Glodok

SUB TOTAL WITHIN JAKARTA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Source: Jones Lang LaSalle B. Outside Jakarta

Completion year Name of shopping centre Address Developer Section NLA (sq.m)

2007 . . . . . . . E-Center 2007 . . . . . . . CBD Ciledug 2007 . . . . . . . Pondok Gede Plaza 2 2007 . . . . . . . Soewarna Junction 2007 . . . . . . . Summarecon Mal Serpong Ph. 1 2008 . . . . . . . Cibinong Town Center 2008 . . . . . . . Blue Mall n/a . . . . . . . . Bekasi Square

Lippo Karawaci Jl. HOS Cokroaminoto Jl. Raya Pondok Gede Jl. Tol Prof. Sedyatmo Summarecon Serpong Jl Raya Bogor Jl. Chairil Anwar Jl. Achmad Yani

PT Supermal Karawaci PT Sari Indah Lestari PT Budi Kencana Megah Jaya PT Sanggraha Daksamitra PT. Summarecon Serpong PT Jaya Abadi Propertindo PT Rekapastika Asri PT Kilap Propertindo

Karawaci Ciledug Pondok Gede Cengkareng Serpong Cibinong Bekasi Timur Bekasi Barat

9,000 12,600 20,000 7,000 40,000 9,000 80,000 57,000

SUB TOTAL OUTSIDE JAKARTA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .234,600

Source: Jones Lang LaSalle 2.7 Retail sales performance Along with the growth of modern retailers, retail sales have also grown at a healthy pace. Most major players, both local and foreign, have enjoyed positive revenue growth over the past five years. Based on data from selected major public-listed retailers, total sales grew at an average of 14% per annum between 2002 and 2006.

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Retail Market Overview Figure 2.6.1: Annual revenue of Indonesias largest public retail companies, 2006
9,000,000 Annual Sales (Million Rp) 8,000,000 7,000,000 6,000,000 5,000,000 4,000,000 3,000,000 2,000,000 1,000,000 0
2002 2003 2004 2005 2006

PT Matahari Putra Prima Tbk PT Hero Supermarket Tbk PT Ramayana Lestari Sentosa Tbk Total Sales Growth p.a. (RHS)

20% 18% 16% 14% 12% 10% 8% 6% 4% 2% 0%

Year

Source: Jones Lang LaSalle Below are the profiles of major players in the retail industry in Indonesia. 2.7.1 Matahari Putra Prima One of the pioneers of the Indonesian retail industry, Matahari was founded by Hari Darmawan back in 1958 and was publicly listed in 1992. It has grown from a small fashion store in Jakarta into the largest retailer in the country today, with a market share of around 25%, as reported by industry analysts. Since being acquired by PT Multipolar Corporation in 1997, Matahari has introduced several new formats such as supermarkets and hypermarkets and other supporting formats such as Timezone family entertainment centres and the Boston pharmacy. The number of outlets under Matahari Group management currently totals over 270 across more than 50 cities throughout the country. Mataharis sales grew quite significantly after Mataharis consolidation in 2002-2003. Over the last three years saw sales grow at an average of 19% per annum. 2.7.2 Ramayana Lestari Sentosa Ramayana Department Store was founded in 1978 and registered with the Jakarta Stock Exchange in 1996. During the 1990s the business expanded into the supermarket format and acquired one local department store and a minimarket. Ramayana is considered the biggest player in the department store format in the middle to lower class segment. Currently, Ramayana has around 69 supermarket outlets and 94 department stores. Sales growth of around 13% per annum was achieved over the past two years. 2.7.3 Hero supermarket The Hero group is known as the pioneer of the modern supermarket format in Indonesia. Opening in 1972, Hero supermarket initially focused on catering to the middle to upper class market. Becoming a publicly listed company in 1991, Hero continued to dominate this segment, until the expansion of foreign hypermarkets such as Carrefour and Makro in the late 1990s provided significant competition. Since then, the group has undergone consolidation and repositioning, particularly after the entry of Dairy Farm International (Hong Kong). Currently, Hero caters to a wide segment, from middle-lower through to the middle-upper income segment. The company has expanded their business by introducing Giant hypermarket in Indonesia, in order to compete with other major players in the market. 2.7.4 Mitra Adi Perkasa Founded in 1995, the group is one among the leading retailers in specialty formats, controlling numerous international brands for the middle to upper income segment, as well as some foreign-labelled department stores under their management. Mitra Adi Perkasa was listed in 2004 and since then has continued to expand aggressively. With more than 40 store concepts, the group now has over 600 stores in 22 cities in Indonesia, including Sogo and Debenhams department stores. Revenue in 2006 grew by 16% to around Rp. 3.3 trillion.
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Retail Market Overview 2.7.5 Carrefour Frances Carrefour first entered the Indonesian market in 1998, almost at the same time as Continent (also from France). After its merger with Continent, Carrefour became the largest player in the hypermarket segment, which was fast gaining popularity in the domestic market. Carrefours strengths include lowpriced offerings, a wide range of goods, ample space and a comfortable shopping experience. The success of Carrefour has outpaced its predecessors such as Makro and Goro (local) and also attracted other new players to compete in this market, such as Giant (Hero Group) and Hypermart (Matahari Group). In 2006, the company recorded total sales of around e689 million in Indonesia, or a 19% growth from the previous year. 2.8 Supply constraints and the regulatory environment According to Indonesian Agrarian Law, a private company or formal institution can only own land certified under HGB (Hak Guna Bangunan or right to build), HGU (Hak Guna Usaha or right of exploitation) and HP (Hak Pakai or right of use) title. HGB is the most common type of legal ownership by private companies or institutions in Indonesia. This land right can be sold, exchanged, transferred, bequeathed or mortgaged. This type of right can be held by Indonesian individuals or entities as well as foreign joint-venture companies which are registered under current Indonesian laws. This right is granted for an initial period of 20 or 30 years and by law extendable for another 20 or 30 year period with further options for renewal. Based on Agrarian Ministry Regulation/Head of National Land Agency No. 4 Year 1998, the payment to the authority for HGB renewal is 1% to 3% of assessed property tax value, depending on the land size and tenure. HGU is the right to cultivate or exploit state-owned land for agricultural, fishery or husbandry purposes. The ownership is valid for a maximum of 35 years but extendable for another 25 year period with an option for renewal. The title can be held by Indonesian individuals or entities as well as foreign joint-venture companies and can be mortgaged. HP is the right to use state-owned land or land owned by others for a specific purpose as agreed by both parties such as for social activities, religious worship, embassies and international organisations. It is valid for a maximum of 25 years but extendable for another period of 20 years or occasionally for an indefinite period as stated in its grant or agreement. Indonesian citizens, individual foreigners residing in Indonesia, foreign embassies, or representative offices of foreign banks or other foreign entities are allowed to own land under this title. However, this type of land cannot be sold, exchanged or transferred unless explicitly provided for in the grant or agreement. At 30 March 2007, Indonesias House of Representative passed the 2007 Investment Law covering key issues such as guaranteed extension of land rights, equality between foreign and local firms, revamp of the negative investment list, less bureaucratic process, revamp of overlapping regional by-laws and fiscal incentives. Under the new law services for rights of land use can be provided and extended in advance, and be renewed as requested by an investor, i.e. 80 years for HBG, 95 years for HGU and 70 years for HP . The Government will soon finalize the implementation regulations as mandated by the Law. Investors or developers can buy land under HGB title from other companies/institutions or freehold land from individuals. But most of the land in prime locations in Indonesia belongs to the state. Typically, developers enter into a BOT (Build-Operate-Transfer) agreement between the developer and the stateowned company as the land owner. Under the BOT agreement, the developer (the operator) builds and operates the building for a predetermined period and transfers the building to the land owner upon the termination of the BOT agreement and this can be extended for another agreed period. The operator may pay the land owner either a lease payment (ground rent) or a percentage of revenues received from usage of the land. In some cases, the operator may provide space within the development for the land owners. The design, construction, operation, management, maintenance or financing of the development cost is the responsibility of the operator. All terms and conditions including the BOT term, ground rent, payment term, ownership of the improvement and related matters are stipulated in the BOT Agreement. The limited commercial land available in strategic locations for retail development could restrict supply in cities such as Jakarta, Bogor and Bandung. With high land prices in the CBD area, retail centre developments tend to be combined with other land uses to optimise development potential.
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Retail Market Overview A further constraint is that commercial buildings, including stand-alone retail developments and shopping centres, can only be built on land zoned for commercial use. This regulation is governed by the local city planning office that issued the regional master plan which details standard building codes such as site coverage, plot ratio and the maximum number of floors. However, the investor or developer may propose a revision/modification of the city planning schedule regarding their site as long as it is still in accordance with the general master plan. The government has enacted a number of policies and regulations with a view to regulating and controlling modern retailers and modern market formats and protecting small retailers and traders. So far, the implementation and supervision of these regulations has not been strong. Legal permits to establish new modern retail market formats are continuously being issued, even in areas where their issue is ostensibly prohibited. As a result, government regulations are in many ways failing to control the existence of modern markets and retailers, and small domestic traders are becoming vulnerable. Below is the list of government regulations related to the retail industry in Indonesia: Decree from Trade Ministry (SK Menperindag) No. 420/1997 Governing the location of modern retail centres such as department stores or supermarkets i.e. must be located within the commercial zone as in the City Planning and only permitted to build in provincial city level (Dati I) and regency level (Dati II). President Decree (Keppres) No. 99/1998 The opening of the retail market for foreign direct investment Jakarta Provincial Administration Regulation (Perda DKI) No. 2/2002 Regulating the operating hours of shopping centres Decree from Treasury Ministry (SK Menkeu) No. 253/2002 The collection of 10% VAT on all retail products in modern market formats Decree from Tax Directorate (SK Dirjen Pajak) No. SE-14/2003 The revision of VAT on service charge in shopping centres from 4% to 10 % 2.9 Retail rentals Rents in most upper grade shopping malls in Indonesias major cities are generally quoted in US Dollars but are paid in Rupiah on a fixed US Dollar to Rupiah exchange rate, which is typically lower than the market rate but generally tracks it. However, in many other shopping centres, rents are quoted and paid in Rupiah. Retail rents in the upper grade shopping malls in Jakarta have seen relatively modest growth in the past four years due to intense competition amongst landlords to attract tenants. Rental growth has been strongest in a number of sought-after shopping malls that enjoy high and stable occupancy rates. In these popular malls, which are mainly located in the CBD or near well established residential districts, rentals have increased within a range of 5-10% per annum between 2003 and 2005, while the overall rent grew by 2-5% annually in Rupiah terms. During this period, annual supply grew by an average of 74,000 sq.m, while average occupancy was 91%-93%. However, rental growth declined in 2006 due to a quite significant additional supply of 149,000 sq.m and a weakening of retail sales. Average occupancy at the end of 2006 decreased to 89%. The governments decision to increase fuel price by approximately 125% in October 2005 triggered high inflation and affected consumers buying power, leading to a stagnant retail market. At the end of 2006, the average net effective rent of prime retail space for specialty tenants (positioned on the first three floors) in Jakartas shopping centres was approximately Rp. 398,000 per sq.m per month. By grade, Upper Grade shopping malls commanded the highest asking rentals of between Rp. 350,000 per sq.m per month and up to Rp. 1.3 million per sq.m per month, while in the Middle Grade shopping centres, rentals varied between Rp. 200,000 per sq.m per month and Rp. 500,000 per sq.m per month for a typical lease of less than 300 sq.m.
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Retail Market Overview In view of the significant new supply coming online in the Upper Grade shopping malls, Jones Lang LaSalle expects that competition amongst landlords to attract tenants in this market segment is expected to cap rental growth over the next one to two years. However, in parts of the city where there is limited new competition in the pipeline, rental outlook should be more promising due to demand outpacing supply and strong growth in retail sales. In addition, it is also anticipated that rental growth in established shopping malls from the Middle Grade category is expected to outperform the market as competition in this sub-market is relatively lighter than in the Upper Grade sub-market. Newly completed retail malls are expected to enter the market between 2007 and 2009. Furthermore, the current high rental gap between Middle Grade and Upper Grade shopping centres could provide room for growth amongst good quality Middle Grade malls, especially those located in prime CBD areas or within close proximity to the established residential districts. In the longer term, improved rental growth from 2009 onwards is possible in view of slower and more selective retail developments. A stronger economic foundation after the election year (2009) is also seen as a factor that could potentially boost retail sales from 2009 onwards. As such, rentals are expected to grow by around 8-10% per annum between 2009 and 2011. Malls with high occupancy, particularly those located in the CBD and near prime residential districts, are expected to outperform the market due to their more stable frequency of visitors. 2.10 Future outlook for the retail sector Recovery in consumer purchasing power is key to the revival of the retail market in Indonesia. Looking ahead, Jones Lang LaSalle anticipates that the engine of the economy will gear up progressively this year, supported by an improving investment climate and a gradual increase in consumption. Therefore, the retail market is expected to gain a stronger foothold, starting mid-2007. In the meantime, competition among existing malls to attract tenants will continue to be tough following the emergence of new projects that offer more competitive packages. In Jakarta, Plaza Indonesia, Plaza Senayan and other similar projects, which lead the competition in terms of rents, now face greater challenges from new projects such as Senayan City, Grand Indonesia and Pacific Place. Therefore, competition in the upper grade sub-market, which is concentrated in the CBD area, is greater than in the middle grade sub-market, where future competitors are more broadly distributed and the target market is greater. Outside Greater Jakarta, particularly in cities where the subject properties are located, the level of competition is forecast to be more modest, thus providing opportunities for higher rental growth in the future. In terms of demand generators, large format anchor retailers such as department stores, hypermarkets and supermarkets will remain key stimulators of demand while smaller retailers with strong brand recognition and good positioning in the market are expected to continue to increase their store rollouts. Foreign retailers are also expected to continue expanding their presence in Greater Jakarta, one of the worlds 10 largest urban areas, as well as other major Indonesian cities, as part of their investment strategy. By sector, the F&B sector and fashion and accessories retailers offering modern lifestyle concepts are expected to remain the leaders in generating demand across all sub-markets. Expansions of chain restaurants and franchise outlets as well as department stores and hypermarkets are expected to generate strong demand, particularly in the middle to lower grade retail projects. In the upmarket segment, foreign department stores, branded fashion stores, cafs and restaurants as well as leisure and entertainment facilities should continue to generate substantial demand in the future.

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Overview of Portfolio 3. OVERVIEW OF PORTFOLIO 3.1 Regional context This section analyses the provinces that the subject centres are located. These provinces are: Jakarta West Java East Java Central Java North Sumatra Banten Bogor As at 2005 Indonesias population was 219 million people, with population growth over the past five years averaging 1.3% per annum. Of the provinces containing subject centres, Banten has experienced the strongest population growth at 2.8% per annum over the past five years. In terms of total wealth, Jakarta has the highest level of GRDP per capita, reflecting its role as the administrative and financial capital of Indonesia. Table 3.1.1 Selected Indonesian Provinces: population levels
Population (2005) Growth average annual growth (2001-2005)

Province

Jakarta . . . . . . . . . . West Java . . . . . . . . East Java . . . . . . . . Central Java . . . . . . North Sumatra . . . . . Banten. . . . . . . . . . . TOTAL INDONESIA

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

7,464,000 39,067,000 35,550,000 31,887,000 12,453,000 9,309,000 219,205,000

(0.1)% 1.8% 0.4% 0.4% 1.4% 2.8% 1.3%

Source: Central Statistics Bureau Table 3.1.2 Selected Indonesian Provinces: GRDP per capita
GRDP (2004 M Rupiah in current prices) GRDP per capita (M Rupiah in current prices)

Province

Jakarta . . . . . . . . . . . West Java . . . . . . . . . East Java . . . . . . . . . Central Java . . . . . . . North Sumatra . . . . . Banten . . . . . . . . . . . TOTAL INDONESIA .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

. . . . . . .

377,159,110 305,305,606 341,765,923 193,435,263 118,100,511 74,562,754 2,303,031,449

50.5 8.0 9.7 6.1 9.6 8.2 10.6

Source: Central Statistics Bureau 3.1.1 Jakarta The province of Jakarta is the capital of Indonesia. Jakarta consists of five municipalitiesJakarta Utara (North Jakarta), Jakarta Timur (East Jakarta), Jakarta Selatan (South Jakarta), Jakarta Barat (West Jakarta) and Jakarta Pusat (Central Jakarta).
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Overview of Portfolio As the administrative centre of Indonesia, Jakartas economy is based on finance and commerce and attracts a particularly high level of foreign investment compared to other parts of Indonesia. Income per capita is high partly driven by a large number of expatriates living in the city, as well as the types of employment available in the area. At the time of the most recent census, the population of Jakarta was 7.5 million. Despite rapid urbanisation over the past 40 years (with population at just 1.2 million people in 1960), and strong growth for Indonesia as a whole, population in Jakarta has been declining over the past five years. This is a result of a decline in the population of Central Jakarta, driven by the changing composition of the city from relatively high levels of residential accommodation to an increasing mix of office development, convention centres and hotels. Over the next five years, the population of Jakarta is expected to start increasing, with particularly strong growth in South Jakarta.

Figure 3.1.1 Jakarta

Source: Jones Lang LaSalle Research and Consulting

3.1.2 West Java West Java is the most populous province of Indonesia, with around 39 million people. The capital, Bandung, is located in a mountainous region of the province, approximately 128 kilometres southeast of Jakarta. Around 2 million people are resident in Bandung. The economy is based around manufacturing and agriculture, with this contributing around 50% of GRDP in 2001. Manufacturing is expected to continue to take an even greater role in the local economy as the agricultural sector contracts. At present, 60% of Indonesian manufacturing industries are located in West Java.
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Overview of Portfolio Figure 3.1.2 West Java

Source: Jones Lang LaSalle Research and Consulting & Jakarta Map & Street Guide 2004 3.1.3 East Java East Java has 35.6 million people and has experienced population growth of approximately 0.4% per annum over the past five years. The capital of East Java is Surabaya, the second largest city in Indonesia and a major industrial centre and port. The economy is driven by the agricultural sector. However, other sectors, manufacturing and trade sectors are playing a more important role in recent years. Major transport infrastructure developments have led to economic growth in East Java. These include the Suramadu Bridge connecting Surabaya City and Madura Island, the East Java Province Mega Project, the Juanda Airport development, the Paithon electricity generation project, and the development of the seaport and telecommunications networks. Figure 3.1.3 East Java

Source: Jones Lang LaSalle Research and Consulting & Jakarta Map & Street Guide 2004 3.1.4 Central Java Central Java has 31.9 million people and has experienced modest growth of 0.4% per annum over the past five years. The capital of Central Java is Semarang. The processing industries contribute around 30% of GRDP , while agriculture is still a major part of the economy, contributing 20% with rice and corn being the provinces dominant crops.
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Overview of Portfolio Figure 3.1.4: Central Java

Source: Jones Lang LaSalle Research and Consulting & Jakarta Map & Street Guide 2004 3.1.5 North Sumatra The province of North Sumatra is on the island of Sumatra, between the Indian Ocean and the Straits of Malacca. The capital is Medan. In 2005, the population of North Sumatra was 12.4 million with average annual growth of 1.4% per annum over the last 4 years. Agriculture remains the dominant sector (contributing 31% of GRDP). However, the manufacturing sector is experiencing strong growth and now contributes to 27% of GRDP . North Sumatras main crops are palm oil, rubber, coffee, cocoa and tobacco. Figure 3.1.5 North Sumatra

Source: Jones Lang LaSalle Research and Consulting & Travel Atlas Indonesia (Periplus) 3.1.6 Banten Banten has 9.3 million people and has experienced strong population growth of 2.8% per annum between 2000 and 2005. Banten is located close to Jakarta and hence benefits from economic growth in this province. The rapid increase in non-residential development in Jakarta has benefitted Banten resulting in its strong population growth.
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Overview of Portfolio Bantens economy relies very little on agriculture, contributing just 10% of GRDP . More than 51% of GDRP comes from industrial services including food processing. Figure 3.1.6 Banten

Source: Jones Lang LaSalle Research and Consulting & Jakarta Map & Street Guide 2004 3.2 Geographic spread The majority of the subject centres are located in Greater Jakarta and the surrounding provinces. Figure 3.2.1 Greater Jakarta: subject centres

NORTH JAKARTA WEST JAKARTA 2

Metropolis Town Square Gajah Mada Plaza

CENTRAL JAKARTA 1
Plaza Semanggi

TANGERANG 3
WTC Matahari

EAST JAKARTA

Mal Lippo Cikarang

17 km more by toll road to Cikarang area

3
Depok Town Square

Cibubur Junction

1 4
Plaza Ekalokasari

25 km more by toll road to Bogor City

Source: Jones Lang LaSalle Research and Consulting Jakarta Map (Periplus)
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Overview of Portfolio Figure 3.2.2 Bandung, West Java: subject centres

Istana Plaza
1

Bandung Indah Plaza

Source: Jones Lang LaSalle Research and Consulting

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Overview of Portfolio Figure 3.2.3 Medan, North Sumatra: subject centres

Grand Paladium

Source: Jones Lang LaSalle Research and Consulting & Medan Map (KPS Surabaya)

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Overview of Portfolio Figure 3.2.4 Semarang, Central Java: subject centre

Java Supermall

Source: Jones Lang LaSalle Research and Consulting & Semarang Map (KPS Surabaya)

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Overview of Portfolio Figure 3.2.5 Malang, East Java: subject centre

Malang Town Square

Source: Jones Lang LaSalle Research and Consulting & Travel Map Surakarta (PIN Maps)

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Overview of Portfolio Figure 3.2.6 Madiun, East Java: subject centre

Plaza Madiun

Source: Jones Lang LaSalle Research and Consulting & http://kotamadiun.go.id

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Overview of Portfolio 3.3 Summary of retail properties 3.3.1 Leased malls Table 3.3.1 summarises the Leased Malls. Please refer to Section 4 for more details. Table 3.3.1 Summary of leased malls (data as at 30 June 2007)
Centre Year opened Floorspace (NLA) Major tenants Other factors

Cibubur Junction . . . . .

2005

34,139 sq.m

Hypermart Hypermarket Matahari Department Store Studio 21 Cinema Fitness First

Plaza Semanggi . . . . .

2003

Total Office & Retail: 58,685 (61,685 sq.m following extension)

Giant Hypermarket Centro Department Store Fitness First 21 Cineplex Gramedia Electronic Solution

Gajah Mada Plaza. . . .

1982

34,278 sq.m

Bandung Indah Plaza. .

1990

26,472 sq.m (30,315 sq.m following extension)

Hypermart Rimo Department Store Millenium Executive Club Gajah Mada Cinema 21 Grand Gajah Mada (Eva Bun, Reception Centre) Hypermart hypermarket, Matahari Department Store

Istana Plaza . . . . . . . .

2001

27,247 sq.m

Rimo Department Store, Hero Supermarket, Ace Hardware

Mal Lippo Cikarang . . .

1995

17,974 sq.m (28,668 sq.m following extension)

Hypermart hypermarket (under construction), Matahari Department Store, Hero Supermarket

Ekalokasari Plaza . . . .

2003

20,587 sq.m (25,600 sq.m following extension)

Matahari Department Store, Marketplace Supermarket

TOTAL . . . . . . . . . . .

219,382 sq.m (241,932 sq.m following extension)

Occupancy Rate 86.4% Trade Area Retail Spending Rp. 18,932 billion Pedestrian Count Weekdays: 15,000 Weekends: 25,000-30,000 Occupancy Rate 96.4% Trade Area Retail Spending Rp. 19,377 billion Pedestrian Count Weekdays: 53,322 Weekends: 60,948 Occupancy Rate 89.1% Trade Area Retail Spending Rp. 20,662 billion Pedestrian Count Weekdays: 13,000 Weekends: 23,000 Occupancy Rate 83.2% Trade Area Retail Spending Rp. 5,661 billion Pedestrian Count Weekdays: 30,000 Weekends: 40,000 Occupancy Rate 98.9% Trade Area Retail Spending Rp. 4,697 billion Pedestrian Count Weekdays: 15-20,000 Weekends: 25-30,000 Occupancy Rate 96.3% Trade Area Retail Spending Rp. 2,865 billion Pedestrian Count Weekdays: 10,600 Weekends: 17,000 Occupancy Rate 87.3% Trade Area Retail Spending Rp. 4,243 billion Pedestrian Count Weekdays: 12-14,000 Weekends: 18-20,000 Average Occupancy Rate 91.6%

Source: Jones Lang LaSalle Research and Consulting, PT. Lippo Karawaci, Tbk

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Overview of Portfolio Figure 3.3.1 Leased malls Cibubur Junction Plaza Semanggi

Gajah Mada Plaza

Istana Plaza

Mal Lippo Cikarang

Ekalokasari Plaza

Bandung Indah Plaza

Source: Jones Lang LaSalle Research and Consulting

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Overview of Portfolio 3.3.2 Retail spaces malls Table 3.3.2 summarises the Retail Spaces Malls. These are each discussed in more detail in Section 5. Table 3.3.2 Summary of retail spaces malls
Centre Year opened Floorspace (NLA) Retail space within the portfolio (NLA)

Java Supermall . . . . . . . . . . . . . . . . . . Malang Town Square . . . . . . . . . . . . . .

2000 2005

19,800 24,740

Grand Palladium Medan . . . . . . . . . . . .

2005

29,272

Metropolis Town Square . . . . . . . . . . . .

2004

60,734

Depok Town Square . . . . . . . . . . . . . . .

2005

41,129

Plaza Madiun . . . . . . . . . . . . . . . . . . . . Mall WTC Matahari . . . . . . . . . . . . . . . .

2000 2003

19,029 48,204

Matahari (department store) Matahari (supermarket) Matahari (department store) Hypermart Timezone Matahari (department store) Hypermart Timezone Matahari (department store) Hypermart Timezone Matahari (department store) Hypermart Timezone Matahari (department store) Matahari (supermarket) Matahari (department store) Hypermart Timezone

11,082 11,065

13,417

15,248

13,045

19,029 11,184

TOTAL . . . . . . . . . . . . . . . . . . . . . . . . . Source: Jones Lang LaSalle Research and Consulting, PT. Lippo Karawaci, Tbk Figure 3.3.2 Retail spaces malls Java Supermall Malang Town Square

94,070

Grand Palladium Medan

Metropolis Town Square

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Overview of Portfolio Mall WTC Matahari Plaza Madiun

Depok Town Square

Source: Jones Lang LaSalle Research and Consulting, PT. Lippo Karawaci, Tbk

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Leased Malls 4. LEASED MALLS 4.1 Cibubur Junction 4.1.1 Regional context and local economy Cibubur is located in the DKI Jakarta Province, approximately 26 kilometres south east of the centre of Jakarta. As the capital city of Indonesia, Jakarta is the administrative and commercial centre of Indonesia. Cibubur Junction (CJ) is strategically located within a growing middle to middle-upper class district. Since opening in July 2005, CJ has quickly established itself as the key local retail destination for middle to middle-upper income residents within the region. CJ is located along Jalan Raya Jambore in East Jakarta, which is located a short distance from the Jagorawi toll road. The centre has good accessibility and visibility from this major road. Cibubur is also serviced by public transport, including metromini and angkot, as well as taxi services. Local industries within the trade area include the following plants and factories along Jl. Raya Bogor: PT Indomilkmilk products PT Bayer Indonesiapharmaceutical PT Amcol Grahaelectronics PT United Plastics Indonesiaplastics PT ICIpaints Pfizerpharmaceuticals Universitas Indonesia Campus, one of the most prominent universities in Indonesia, is located approximately eight kilometres from CJ. Since opening, CJ has quickly become the most prominent shopping centre for the local community and has captured a significant amount of expenditure from local middle-upper income residents that was previously leaving the trade area. As a result of providing these residents with a viable alternative, CJ has reduced the propensity of trade area residents to conduct discretionary shopping in Central Jakarta. The centre provides a one stop shopping destination to meet the everyday convenience shopping requirements of residents in its immediate catchment area. In addition, the centre possesses destinational appeal and a good mix of non-food retailing to meet the needs of its growing trade area. 4.1.2 Description Commencing operation in July 2005, CJ is a modern shopping centre comprising some 34,139 sq.m of NLA over five levels with a rooftop and basement. Table 4.1.1 provides details of the centre.

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Leased Malls Figure 4.1.1 Cibubur Junctionmain external entrance

Source: Jones Lang LaSalle Table 4.1.1 Centre details, Cibubur Junction
Characteristics

Address . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Year Opened . . . . . . . . . . . . . . . . . . . . . . . . . . . Last Refurbishment / Extension . . . . . . . . . . . . . NLA (sq.m): . . . . . . . . . . . . . . . . . . . . . . . . . . . . Site Area (sq.m) . . . . . . . . . . . . . . . . . . . . . . . . . Car Parking . . . . . . . . . . . . . . . . . . . . . . . . . . . . Motor Cycle Parking . . . . . . . . . . . . . . . . . . . . . . Levels . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Opening Hours . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . .

Occupancy Rate. . . . . . . . . . . . . . . . . . . . . . . . . . Major Retail Tenants: Majors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Mini Majors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Selected Other . . . . . . . . . . . . . . . . . . . . . . . . . . .

Jl. Raya Jambore 2005 Ongoing tenant rezoning 34,139 31,987 611 500 6 Weekdays: 10am - 10pm Weekends: 10am - 10pm 86.4% (as at 30 June 2007) Hypermart, Matahari Fitness First, Studio 21 Cinemas, Sport Warehouse, Karisma Bookstore A&W, Pizza Hut, Starbucks, Giordano, Body Shop, Polo Ralph Lauren, Charles & Keith, Guardian, Planet Surf 163 Weekdays: 15,000 Weekends: 25,000 - 30,000

Total Retail Tenancies. . . . . . . . . . . . . . . . . . . . . . Shopper Traffic . . . . . . . . . . . . . . . . . . . . . . . . . . .

Source: Jones Lang LaSalle Research and Consulting, PT. Lippo Karawaci, Tbk 4.1.3 Tenant mix Since opening, centre management has taken care to ensure an appropriate tenancy mix is developed at CJ. This has meant that vacancy levels have been slightly higher than would otherwise be the case, as vacancy has been tolerated in favour of leasing space to tenants that do not complement the carefully formulated tenant mix strategy. Most notably, the centre has successfully targeted a number of internationally branded retailers in order to appropriately cater for middle to middle-upper income residents within the trade area. These retailers include The Body Shop, Giordano, Polo Ralph Lauren, Charles & Keith, Guardian, Planet Surf, Starbucks Coffee and Pizza Hut.
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Leased Malls Table 4.1.2 Tenancy mix by level, Cibubur Junction

Level Tenant Mix

Lower Ground. Ground . . . . . . Upper Ground. First . . . . . . . . Second . . . . . . Third. . . . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

. . . . . .

Hypermart, food court, exhibition space/casual leasing, other specialties Fashion, accessories, exhibition space Matahari, fashion, beauty Matahari, Sports Warehouse, fashion Matahari, Timezone, lifestyle & entertainment, electronics Fitness First, cinemas

Source: Jones Lang LaSalle Research and Consulting Figure 4.1.2 Cibubur Junction: lower ground food court

Source: Jones Lang LaSalle Research and Consulting The centre is positioned to provide one stop shopping convenience by serving the convenience and discretionary retail needs of the local community. The lower ground floor is anchored by Hypermart, which accounts for approximately 25.8% of the NLA. This level is supported by a food court, exhibition space on short term leases and a range of retail services. The ground floor comprises predominantly branded fashion and accessories retailers and quality food and beverage retailers. The central atrium is utilised for short term exhibition space. The Matahari Department Store anchors the upper ground and first floors and is expanding into level 2. The expanded Matahari store accounts for 16.7% of the centre NLA. Upper Ground and Level 1 comprise a mix of specialty retailing including fashion, childrens wear, accessories and beauty. A large Sports Warehouse store is on Level 1 while Karisma Bookstore is on Upper Ground. Level 2 is focussed on entertainment and lifestyle retailing. This level includes the extended Matahari store, Timezone and the entrance to Fitness First and Cinema 21. There is also a large number of small tenancies, including electronics and handphone retailers. The top level comprises Fitness First and Cinema 21, which has four screens.

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Leased Malls Table 4.1.3 Major tenants as at 30 June 2007, Cibubur Junction
Tenant Expiry date % Gross monthly rent

Hypermart . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Matahari . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Fitness First . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Sport Warehouse . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Cinema 21 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Karisma Bookstore . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Timezone . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Other tenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Total Centre . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . .

27-Jul-15 30-Aug-15 14-Apr-21 9-Dec-10 23-Mar-16 30-Nov-10 30-Oct-15 Varies

14.2% 11.2% 3.0% 2.1% 1.6% 1.5% 1.5% 64.9% 100.0%

Source: Jones Lang LaSalle Research and Consulting, PT. Lippo Karawaci, Tbk Note: Excludes extension to Matahari Department Store, Level 2 4.1.4 Target market CJ targets the growing number of middle and middle-upper income households within the region. To cater for this target market, there has been a particular focus on attracting well known, internationally branded retailers to the centre. CJ is the only centre within the immediate region that effectively targets this market. 4.1.5 Trade area analysis To assist with the definition of trade areas, a market research survey of visitors to major leased malls was undertaken in February and March 2007. A total of seven (7) centres were included in the study. The survey was conducted by TNS on behalf of Jones Lang LaSalle for the purposes of this assessment. The main findings of the market research in relation to the profile of shoppers at CJ are as follows: Visitors to CJ are relatively young (80% of those surveyed are less than 35 years of age), with the vast majority (i.e. 98%) nominating their ethnicity as Malay; Visitation to CJ is much higher on weekends than weekdays, and shopper traffic is particularly high in the afternoon (between 16:00 and 19:00); CJ is more destinational in appeal, as it has the lowest frequency of visitation of all centres included in the portfolio. However, when patrons visit the centre they stay for long periods: CJ has the highest proportion of visitors who stay for two hours or more of all centres in the portfolio where visitors were surveyed; CJ recorded a very low proportion of survey respondents who were visiting the mall alone (i.e. 6%), while the proportion of respondents visiting with their partners or spouse is very high (i.e. 40% in total). Meals are the main reason for visiting the mall, followed by comparison shopping, grocery shopping and movies. Of all the malls included in the market research study, CJ has the third highest level of overall customer satisfaction. Visitors surveyed were generally very satisfied with the facilities, the tenancy mix and the level of security at CJ. The trade area for CJ has been defined based on the findings on customer origin from the market research survey, the strength of the subject site, the location and relative strength of competing retail facilities and accessibility to the centre, including the road network, public transport and physical barriers. According to the market research survey, the areas where the level of market penetration is highest for CJ are Ciracas, Cipayung, Pasar Rebo and Cimanggis. The primary trade area (PTA) also includes the districts of Kramat Jati, Gunung Putri and Pancoran Mas. The STA includes areas form which CJ attracts visitors. However, the level of customer draw (market share penetration) is below the level achieved in the PTA. Areas considered to fall within the STA include Duren Sawit, Jagakarsa, Pasar Minggu, Bekasi Selatan and Pondok Gede.
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Leased Malls The trade area, including major competing centres within the trade area, is illustrated in the map below. Figure 4.1.3 Cibubur Junction trade area
1. 2. 3. 4. 5. 6. 7. 8. 9. 10. Graha Cijantung Mal Depok Mal Citra Gran Plaza Cibubur Mal Cimanggis Cileungsi Trade Center Depok Town Square ITC Depok Margo City Tamini Square
10 1

Cibubur Junction

5 7 9 2 8 4 3 6

Source: Jones Lang LaSalle Research and Consulting & Jakarta Street Atlas (Gunther W. Holtorf) As at 2007, the PTA is estimated to comprise nearly 423,000 households in the middle and upper income target markets while the STA, which is smaller, comprises a further 319,000 such households. Numerous housing estates have been developed in recent years, increasing the market for quality shopping facilities at Cibubur. These include the following: Permata Puri Laguna Permata Puri Cibubur Indah Puri Sriwedari Raffles Hills Kota Wisata Legenda Wisata Bukit Golf Cibubur Riverside Based on recent population trends in the area, middle and upper income households in the PTA is forecast to grow by 2.8% per annum between 2007 and 2011, increasing to 473,000 households. Slightly lower growth is expected in the STA.

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Leased Malls Table 4.1.4 Cibubur Junction trade area: population growth and spending forecasts
% Growth 2007-2011 (p.a.)

2007 (f)

2011 (f)

Primary Trade Area . . . . . . .

Secondary Trade Area . . . . .

Population Households* Retail Spending per Household (Rp. Million) Total Retail Spend (Rp. Billion) Population Households* Retail Spending per Household (Rp. Million) Total Retail Spend (Rp. Billion)

2,255,374 422,862 18.03 7,624 1,608,510 318,865 18.62 5,937

2,460,252 472,826 21.10 9,977 1,728,964 351,311 21.79 7,655

2.2% 2.8% 4.0% 7.0% 1.8% 2.5% 4.0% 6.6%

Source: AC Nielsen; Economic Intelligence Unit; Jones Lang LaSalle Research and Consulting * Note: Total Households and Retail spending market only includes only those households assumed to fall within the target market (i.e., AC Nielsen Socio Economic Status (SES) categories A to C, described as middle and upper income households). Spend market at 2007 prices (i.e. 2011 spend market at 2007 prices; average annual retail spending per household and total retail spend market growth forecasts are real, not nominal, growth, excluding the effects of inflation) With real per capita spending expected to increase by an average of approximately 4% over the next four years and together with moderate population growth, total retail spend in the PTA for the target market is expected to grow by 7.0% per annum between 2007 and 2011. Slightly lower growth is expected in the STA. 4.1.6 Competition CJ is clearly the most visited mall amongst its customers, with 71% of respondents surveyed reporting the subject site as the centre they visit most often. The local centres of competitive relevance (i.e. centres larger than 10,000 sq.m), including their distance from CJ, opening year, amount of retail floor space and major tenants, are detailed in Table 4.1.5. The largest centres are discussed below: Pondok Indah Mall is a large leased mall located in South Jakarta, 23 kilometres from the subject site. The mall contains around 100,000 sq.m of retail space and is anchored by a number of middle-upper department stores and includes cinemas. Given its distance from the subject site and its tenancy mix (i.e. higher order retailing targeting middle-upper segments), Pondok Indah Mall is only considered likely to be competing with CJ for discretionary spending rather than weekly convenience retailing. Depok is situated approximately 10 kilometres west of CJ. Depok contains a number of retail facilities which, when combined, are of competitive relevance to the subject site. The main centres in Depok are Depok Town Square (a strata mall anchored by Matahari and Hypermart), Margo City (a leased mallanchored by Centro department store and Giant hypermarket), Mal Depok (a lease mall anchored by a Matahari Department Store and Matahari Supermarket) and ITC Depok (a strata mall anchored by Carrefour). Margo City is considered to be of most relevance to the subject site given it is targeting middle-upper income households and as it is the only major centre in Depok with a department store other than Matahari (i.e. Centro), which is a point of difference. Graha Cijantung is located 11 kilometres northwest of the subject site. This lease mall contains 45,000 sq.m of retail space anchored by a Ramayana Department Store and a Hero Supermarket. The centre is targeting middle-lower income households, therefore not considered as a major competitor to the subject site. Tamini Square is a strata mall located approximately 9 kilometres north of CJ. The mall is anchored by a Cahaya department store and a Carrefour hypermarket. The centre is considered to be of minimal competitive relevance as it is targeting a lower income segment compared with the subject site.
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Leased Malls There is a small but growing commercial precinct at Cibubur servicing the local community. This includes Plaza Cibubur, Mal Citra Gran and some traditional retailing along Jl. Trans Yogie. Mal Citra Gran, which opened in 2001, is located 5 kilometres from CJ, has an NLA of 10,900 sq.m and is anchored by Hero Supermarket. Plaza Cibubur, located 3 kilometres from CJ, also opened in 2001 and has an NLA of 17,000 sq.m, with Superindo Supermarket as its anchor tenant. These two retail malls mostly target their immediate population catchments and, reflective of the absence of a department store anchor, serve more as convenience shopping centres as opposed to being a destination mall. The future outlook for trading prospects at CJ is positive, supported by there being very little additional retail facilities proposed to be added to the trade area in the short term. There are a number of retail projects targeting middle income households currently under construction in Jakarta, such as Gajah Mada Square (due to open in the third quarter 2007), Mall of Indonesia (due to open in the first quarter 2008, and Emporium (due to open in the second quarter of 2009), which will add a combined 378,000 sq.m of retail floor space to the Jakarta retail market by the end of 2009. However, given the distance of these projects from the subject site, and the continued population growth expected in CJs trade area, these new centres are expected to have a negligible impact on the performance of the subject site. The potential threat for CJ is the possibility of the development of a centre which also targets middle-upper income households in its trade area. While this threat has not yet materialised, it is possible that a developer may seek to capitalise on the strong rise in the resident population which falls within this lucrative market segment and compete with CJ in its immediate vicinity. Table 4.1.5 Main competition, Cibubur Junction
Distance from Cibubur Junction NLA (sq.m) Year opened

Centre name

Type

Anchor tenants

Pondok Indah Mall . . . . . Depok Town Square. . . . Margo City . . . . . . . . . . . Graha Cijantung. . . . . . .

23 km 10 km 10 km 11 km

Lease Strata Lease Lease

100,500 59,000 49,000 45,000

1996 2005 2006 1997

Tamini Square . . . . . . . . Mal Depok . . . . . . . . . . . ITC Depok . . . . . . . . . . . Plaza Cibubur . . . . . . . .

9 km 10 km 10 km 3 km

Strata Lease Strata Lease

35,000 28,000 25,351 17,000

2006 1997 2005 2001 2003 2001 2004

Mal Cimanggis . . . . . . . . 6 km Lease 12,000 Mal Citra Gran . . . . . . . . 5 km Lease 10,900 Cileungsi Trade Centre. . 8 km Strata 10,000 Source: Jones Lang LaSalle Research and Consulting

Sogo, Sogo Food Hall, Metro, Hero Matahari Dept. Store, Hypermart Giant, Centro Dept. Store, Platinum Cineplex Hero Supermarket, Ramayana Dept. Store, Studio 21 Carrefour, Cahaya Dept. Store Matahari Dept. Store and Supermarket Carrefour Superindo Supermarket, Karisma Book Store Naga supermarket Hero Supermarket N/A

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Leased Malls 4.1.7 SWOT analysis Table 4.1.6 provides a summary of the strengths, weaknesses, opportunities and threats for CJ. Table 4.1.6 SWOT analysis, Cibubur Junction
Strengths Weaknesses

The centres has a strong and appropriate tenancy mix for its customer base with a good range of internationally recognised retailers sought after by middle to middle-upper income consumers The centres contains a good lifestyle offering which reflects the needs of its relatively young customer base, including food and beverage outlets, Fitness First, cinemas and Timezone CJ also performs well as a destination for non-discretionary shopping, containing the second best performing Hypermart in Jakarta with a high spend per customer The lack of competition in the region targeting middle to upper income residents makes CJ the leading retail destination amongst its target market
Opportunities

Shortage of parking, particularly on weekends The current occupancy level, at 86.4% of NLA, is above the industry average but below the level for a strong centre. In particular, the higher secondary malls appear to be underperforming compared with the rest of the centre

Threats

Further reduce escape expenditure from the middle-upper income residents that frequent centres closer to Jakarta Reduce overall vacancy by reconfiguring the mall to increase NLA and introduce new tenants (such as an electronics store) that complete the retail offer and reinforce the zoning strategy Extending the Matahari Department store by 2,000 sq.m should also assist in improving the performance of underperforming secondary malls on upper levels The centre can increase car parking space via the use of adjoining land Source: Jones Lang LaSalle Research and Consulting 4.1.8 Future outlook

Future shopping centre development may emerge to capitalise on the growing middle to middle-upper market in the region that CJ currently dominates

There is considerable upside for the trading performance in the short to medium term at CJ. New housing estates (both existing and proposed) are increasing the pool of middle and middle to upper income households within the centres trade area. Following the opening of the centre in mid 2005, which led to a significant reduction in spending by middle to upper income residents at centres outside the trade area in favour of CJ, further opportunities exist to reduce the escape expenditure that is directed towards other retail centres closer to Central Jakarta. The expansion of the Matahari Department store provides an opportunity to improve traffic flow in the secondary mall on level two, one of the areas in the centre where vacancy and shopper traffic flows are still a concern. Furthermore, it is understood that negotiations are in advanced stages with a major electronics retailer to be located on the lower ground floor. These major new additions to the retail offer could be expected to decrease the overall vacancy rate in the mall, improve the trading performance of associated specialty retailers and also provides the opportunity to further enhance the tenancy mix of the centre.
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Leased Malls Figure 4.1.4 Cibubur Junctionmall atrium

Source: Jones Lang LaSalle Research and Consulting While lack of parking within the centre remains an issue, management is negotiating with an adjoining land owner to gain access to additional parking spaces. This should alleviate congestion at the centre, particularly on weekends, improving customer perceptions of the centre and helping to increase shopper traffic at peak trading periods. Table 4.1.7: Rental positioning, Cibubur Junction
Average current rents (Rp./sqm/month) Estimated range of market rents (Rp./sqm/month)

Tenancy category

Growth prospects

Anchor Tenants . . Major Tenants . . . Specialty Tenants F&B, Restaurants

.. .. .. ..

... ... ... ...

47,000 58,000 229,000 192,000

45,000 - 50,000 50,000 - 70,000 200,000 - 230,000 150,000 - 200,000

Potential Potential Potential Potential

growth growth growth growth

upon upon upon upon

lease lease lease lease

renewal renewal renewal renewal

Source: Jones Lang LaSalle Research and Consulting While rent levels are considered to be currently at market, rental growth should be positively influenced by the above mentioned factors, which include: Growth in target middle-upper income market Expansion of anchor store, Matahari, improving traffic flow Potential for additional major stores, or mini-anchors Increased overall occupancy levels Improved parking Strong market position, with no new proposals currently in the pipeline Growth prospects of major and anchor tenants may be limited in the short term due to long lease terms, but considerable potential exists to grow specialty and F&B rentals due to the combination of these factors at lease renewal. Furthermore, the care that has been taken with retail zoning and attracting tenants that complement the existing mix should support long term growth in shopper traffic, turnover and ultimately rental income. Considering these factors and the potential growth of retail spending in the trade area, average rents of CJ are projected to grow at approximately 11-13% per year across 2007-2009. At present, no proposals currently exist for new centres to compete directly with CJ. However, given the attractiveness of its position as the only centre in the region serving the growing number of middle to upper income households in its immediate catchment, CJ should aim to consolidate its position as the leading shopping centre within its trade area. Centre management should ensure it follows through on the abovementioned improvements to the centre to ensure that it is appropriately prepared for the potential opportunistic entrance into the market by a competing centre in the medium to long term.
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Leased Malls 4.2 Plaza Semanggi 4.2.1 Regional context and local economy The Plaza Semanggi (PS) is located at Jalan Jend. Sudirman Kav. 50, Karet Semanggi, in the Setiabudi subdistrict of Jakarta. The centre is strategically located at the heart of the CBD within the citys Golden Triangle at the Semanggi interchange, which is a major thoroughfare for north-south and east-west traffic. Located in the heart of the Jakarta CBD, the centre is situated amongst the key commercial activities of the city, and near a number of Jakartas most prominent universities, including Atmajaya University, which is adjacent to the property. Since opening, The PS has established itself a focal point for the CBD and a meeting point for a wide range of visitors. The mall is complemented by a range of non-retail uses within the mixed use development, such as a convention hall and office tower, including a nightclub. The centre provides a one stop shopping destination to meet the everyday convenience retail requirements of customers in its target market, both residents in the area and the local workforce and student population. The centre also serves a lifestyle and entertainment function, and is a destination for comparison shopping. The centre possesses destinational appeal and caters for convenience shopping requirements in a central location that is easily accessible by car and public transport. 4.2.2 Description Commencing operation in November 2003 (with grand opening in March 2004), The PS is a modern shopping centre comprising approximately 58,685 sq.m of NLA over 7 levels of retail space 13 level office space and 2 basements. Table 4.2.1 provides details of the centre and Table 4.2.2 contains a listing of major tenancies at the subject site, including lease expiry date and the percentage contribution by the major tenant to gross monthly rent. Figure 4.2.1 The Plaza Semanggiexternal

Source: The Plaza Semanggi Business Plan Figure 4.2.2 The Plaza Semanggi: ground floor

Source: Jones Lang LaSalle Research and Consulting

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Leased Malls Table 4.2.1 Centre details, The Plaza Semanggi

Characteristics

Address . . . . . . . . . . . . . . . . . . Year Opened . . . . . . . . . . . . . . . Last Refurb/Extension . . . . . . . . NLA (sq.m): . . . . . . . . . . . . . . .

Jl. Jend. Sudirman Kav. 50, Karet Semanggi, Jakarta 2003 NA 58,685 (retail and office) (61,685 following extension) Site Area (sq.m): . . . . . . . . . . . . 19,000 (approximately) Car Parking . . . . . . . . . . . . . . . . 1,100 Motor Cycle Parking . . . . . . . . . 750 Levels . . . . . . . . . . . . . . . . . . . . 7 (retail), 13 (office), 7 (parking), 2 (basement) Opening Hours . . . . . . . . . . . . . Weekdays: 10am - 10pm Weekends: 10am - 10pm Occupancy Rate . . . . . . . . . . . . 96.4% (as at 30 June 2007) Major Retail Tenants: Name Centro Department Store . . . . . Giant Hypermarket . . . . . . . . . . Electronic Solution . . . . . . . . . . Fitness First . . . . . . . . . . . . . . . Gramedia . . . . . . . . . . . . . . . . . Gillians Billiard . . . . . . . . . . . . . Other Key Retailers . . . . . . . . . . Total Retail Tenancies . . . . . . . . Shopper Traffic . . . . . . . . . . . . . % NLA 13.3% 10.6% 7.2% 3.6% 3.0% 1.7% Ajisen Ramen, Balai Sabrini, Gillians Billiard, Giordano, Gloria Jeans, Pizza Hut, Starbucks 456 Weekdays: 53,000 Weekends: 60,000

Source: Jones Lang LaSalle Research and Consulting, PT. Lippo Karawaci, Tbk Table 4.2.2 Major tenants as at 30 June 2007, The Plaza Semanggi
Tenant Expiry date % Gross monthly rent

Centro Department Store . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Giant Hypermarket . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Electronic Solution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Fitness First . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Gramedia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Gillians Billiard . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Other tenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Total Centre . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

4-Nov-2013 14-Feb-2019 31-Oct-2011 17-May-2020 30-Nov-2010 19-Jul-2009

8.6% 5.6% 5.0% 2.5% 1.8% 1.5% 75.0% 100.0%

Source: Jones Lang LaSalle Research and Consulting, PT. Lippo Karawaci, Tbk 4.2.3 Tenant mix The PS possesses a good tenancy mix. The centre is anchored by the only Centro department store located in Jakarta and a Giant hypermarket. In addition, the centre contains a mix of traditional short-lease specialty stores, including a number targeting the middle to middle upper segments, as well as long-lease specialty stores across two precincts in the mall. Table 4.2.3 summarises the tenancy mix by level at The PS. The lower ground floor is tenanted by Giant hypermarket and the ground floor includes food and beverage, retail services, gifts, and health and beauty outlets. The ground floor also comprises a variety of small tenants (typically 5 sq.m to 10 sq.m) occupying space over a long lease structure (generally 30 years). The Centro department store anchors three levels, namely the upper ground level, level one and level two, while Fitness First also occupies space across these three levels. The upper ground floor contains a
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Leased Malls number of international fashion retailers to complement the department store and cater for middle to middle-upper segment visitors. High profile tenants on the upper ground level include Planet Surf, Giordano, Adidas and Da Vinci jewellery. Starbucks, Bread Talk and a number of optical retailers are also located on the upper ground floor. The first floor mainly covers fashion, including accessories and shoes. The second level has a focus on mobile phones, electronics and computers. This level includes long lease tenants, the majority of which are also focused on small electronics. The third level is dominated by homewares and furniture retailers, some of which are also on a long lease structure. Duck King, a popular local restaurant, is also on the third level. Level 3A is the location of the centres main food and beverage offering, including a traditional food court with small hawker style retailers and a restaurant precinct. The restaurant precinct includes traders with internal seating and enhanced ambience. The fifth level is the location of the centres cinema complex. Table 4.2.3 Tenancy mix of retail component by level, The Plaza Semanggi
Level Tenant mix

Lower Ground Floor. . . . . . . . . . Ground Floor . . . . . . . . . . . . . . . Upper Ground Floor. . . . . . . . . . First . . . . . . . . . . . . . . . . . . . . . Second . . . . . . . . . . . . . . . . . . . Third . . . . . . . . . . . . . . . . . . . . . Level 3A . . . . . . . . . . . . . . . . . . Fifth . . . . . . . . . . . . . . . . . . . . .

Giant (hypermarket) Food and beverage, retail services, gifts, health and beauty Centro (department store), Fitness First, fashion accessories, fashion, health and beauty Centro (department store), Fitness First, fashion, fashion accessories, textiles Centro (department store), Fitness First, computers, mobile phones, electronics Homewares, Furniture Food and beverage 21 Cineplex

Source: Jones Lang LaSalle Research and Consulting 4.2.4 Target market The PS primarily targets the growing number of consumers within Greater Jakarta that fall within the middle and middle to upper income segments. In particular, the presence of Centro, a less common but more upmarket department store, allows the centre to uniquely cater for this market. The centre contains a good mix of well known national and international retailers and has an excellent lifestyle offering which includes Fitness First and 21 Cineplex. It also has a very strong food and beverage offering. Given the PS strategic location, the centre is a focal meeting point for a wide range of visitors in the city, with its tenant mix suitable for a broader range of customer segments. For example, long-lease tenants located in the mall has broaden the centres appeal and the food court broadly targets the local market. 4.2.5 Trade area analysis To assist with the definition of trade areas, a market research survey of visitors to the major leased malls was undertaken in February and March 2007. A total of seven (7) centres were included in the study. The surveying was conducted by TNS on behalf of Jones Lang LaSalle for the purposes of this assessment. The main findings of the market research in relation to the profile of shoppers at The PS are as follows: Visitors to The PS are relatively young (91% of those surveyed are younger than 35 years of age); While the majority (i.e. more than 60%) nominate their ethnicity as Melayu, the centre also attracts a high proportion of Chinese visitors; The survey indicated that weekend visits to The PS is only slightly higher than weekday visits, which reflects the surrounding workforce and student population supporting pedestrian counts on weekdays; Shopper traffic is particularly high in the early and late afternoon (between 12:00 and 15:00 and again between 16:00 and 19:00), which reflects the strength of lunch time trading as a result of the surrounding
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Leased Malls workforce and student population, commuter traffic on weekday afternoons during peak hours, and the usual peaks for customers in the afternoon on weekends; Just over half of all visitors surveyed came directly from home to The PS. A significant proportion came from work (17%) and campus/school (19%). Home was the destination for the vast majority of respondents on leaving the centre (i.e. 86%); The PS has a high frequency of visitation, with 5% of respondents claiming to visit the mall everyday. A further 24% visit more than once a week; Visitors to The PS generally stay for long periods of time. The centre has the highest proportion of visitors who stays for an average of three hours or more (i.e. 45% of respondents) of all centres in the portfolio where visitors were surveyed. Just one in five frequent visitors to the mall stay for an average of less than two hours during each visit; Reflecting the centres function as a meeting point and its central location for commuters, The PS recorded a relatively high proportion of survey respondents who usually visit the mall alone, while the proportion of respondents visiting with friends is also very high; Meals are the main reason for visiting the mall, followed by window shopping, shopping for clothes, shopping for fashion accessories (bags, shoes) and meeting friends; Of all the malls included in the market research study, The PS has the second highest level of overall customer satisfaction. Visitors surveyed were generally satisfied with facilities, the tenancy mix and the level of security at the centre. The trade area for The PS has been defined based on the findings on customer origin from the market research survey, the strength of the subject site, the location and relative strength of competing retail facilities and accessibility to the centre, including the road network, public transport and physical barriers. Based on these considerations, the centres PTA has been defined to cover a number of areas. According to the market research survey, the areas where the level of market penetration is highest for The PS are areas in Jakarta including Setiabudi, Tanah Abang, Palmerah and Tebet. Other areas included within the primary catchment are Kebayoran Baru, Mampang Prapatan and Grogal Petamburan. The survey found that the secondary catchment includes areas where The PS attracts visitors from, however the level of customer draw (market share penetration) is below the level achieved in the PTA. Areas considered to fall within the STA include Pancoran, Kebayoran Lama, Jatinegara, Kebon Jeruk, Pesanggrahan and Pulo Gadung.

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Leased Malls Taking the survey and the other factors outlined above into account, the trade area, including major competing centres within the trade area, is illustrated in Figure 4.2.3. Figure 4.2.3 The Plaza Semanggi trade area
1. Sarinah 2. Ratu Plaza 3. Plaza Indonesia 4. Blok M Plaza 5. Pondok Indah Mall 6. Ciputra Mall 7. Plaza Senayan (Phase 1&2) 8. Pasar Festival 9. Taman Anggrek Mall 10. Mal Ambassador 11. Senayan City (Forum) 12. Pasaraya Blok M 3 (Pasaraya Grande) 13. ITC Kuningan 14. STC Senayan 15. Dharmawangsa Square City Walk 16. Plaza Indonesia EX 17. Grand ITC Permata Hijau 18. Setiabudi One d/h Plaza Setiabudi I 19. Bellagio Boutique Mall 20. Plaza Senayan Annex (Arcadia) 21. Jakarta City Center (JaCC) Hyperstore 22. Mall Pondok Indah 2 23. Mal Kelapa Gading 1, 2 & 3 PROPOSED 24. Grand Indonesia 25. Citywalk Sudirman @ Cityloft 26. Main Street Gandaria 27. Pacific Place 28. Kota Kasablanka 16. Plaza Indonesia Extension 29. Kemang Village 30. Epicentrum Walk 31. Sudirman Place

23

6 9 16 1 3
24

21

Plaza Semanggi
8 30 8 28

25 17 20 11 7 2 14 10 31 27 19

26

12

15 13 29

22

5km

Source: Jones Lang LaSalle Research and Consulting & Jakarta Street Atlas (Gunther W. Holtorf) As at 2003, the PTA is estimated to have a population of 1.18 million (within around 286,000 households) while the STA had a population of 1.90 million (approximately 447,000 households). In recent years, highrise residential development has been accelerating in Central Jakarta. Development of condominiums and apartment complexes has added thousands of households to the PTA of The PS serves over recent years. However, the growth in apartments, which are typically domiciled by middle to upper income residents, is being offset by other residents vacating the trade area in search of more affordable housing and a result of the dislocation of some residents by new property developments. The PTA population is estimated to remain virtually unchanged in the four years between 2003 and 2007 but the population is becoming more affluent. The PTA has declined by 0.1% per annum between 2003 and 2007, decreasing to an indicative population of 1.17 million. The STA is estimated to have exhibited a larger decline in population over the period, falling by 1.2% per annum, to approximately 1.81 million in 2007. Importantly for The PS, 95% of all households in the PTA fall within the targeted middle to upper income group (defined as including households which are classified as SES A, B and C), while a similar proportion of STA residents (92%) are also within this target demographic. As a result, the number of target market households in the PTA is estimated at 270,400 households in 2007. The corresponding figure for the STA is 417,500 target market households. The population is forecast to decrease over the next four years. However, as a result of a combination of population changes and reducing household sizes, the number of target market households is expected to
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Leased Malls continue growing up to 2011. The PTA is forecast to contain around 283,900 target households in 2011, while the STA is forecast to contain approximately 440,100 target households. Average expenditure by households within the subject sites target market is estimated at Rp. 21.3 million per annum in 2007. Average annual household retail expenditure is expected to reach Rp. 24.9 million by 2011. As a result, the annual total retail spending market in the PTA is forecast to increase from Rp. 5,759 billion in 2007 to Rp. 7,076 billion in 2011, which represents an average annual rise of 5.3%. The corresponding increase in the secondary retail market is a rise from Rp. 8,893 billion to Rp. 10,971 billion, which reflects average annual growth of 5.4%. Table 4.2.4 details the current and forecast levels of population growth and retail spending by households that fall within the centres target market (i.e. middle and upper income households). Table 4.2.4 The Plaza Semanggi trade area: population growth and spending forecasts
% Growth 2007-2011 (p.a.)

2007 (f)

2011 (f)

Primary Trade Area . . . . . . .

Secondary Trade Area . . . . .

Population Households* Retail Spending per Household (Rp. Million) Total Retail Spend (Rp. Billion) Population Households* Retail Spending per Household (Rp. Million) Total Retail Spend (Rp. Billion)

1,169,586 270,387 21.30 5,759 1,808,702 417,531 21.30 8,893

1,160,351 283,877 24.93 7,076 1,780,406 440,130 24.93 10,971

(0.2)% 1.2% 4.0% 5.3% (0.4)% 1.3% 4.0% 5.4%

* Note: Total Households and Retail spending market only includes only those households assumed to fall within the target market (i.e., AC Nielsen Socio Economic Status (SES) categories A to C, described as middle and upper income households). Spend market at 2007 prices (i.e. 2011 spend market at 2007 prices; average annual retail spending per household and total retail spend market growth forecasts are real, not nominal, growth, excluding the effects of inflation) Source: AC Nielsen; Economic Intelligence Unit; Jones Lang LaSalle Research and Consulting 4.2.6 Competition The PS is the most visited mall amongst its customers, with 43% of respondents to the market research survey reporting the subject site as the centre they visit most often. The local centres of competitive relevance (i.e. centres larger than 20,000 sq.m), including their distance from The PS, opening year, amount of retail floor space and major tenants, are detailed in Table 4.2.5. The largest centres are discussed below: Mal Kelapa Gading is located 10 kilometres from The PS. However, due to its large size (130,000 sq.m) and established position (the centre has been open since 1990), it is of competitive relevance in a broader sense. Mal Kelapa Gading is anchored by upmarket department stores and supermarket operators Sogo and Diamond. Pondok Indah Mall is a large lease mall located in South Jakarta, 6 kilometres southwest of the subject site. The mall contains around 100,000 sq.m of retail space and is anchored by a number of department stores. The centre also contains cinemas. Mal Taman Anggrek is situated 5 kilometres to the northwest of The PS, but is easily accessible from the subject site via Jendral Gatot Subroto, the tollway road. The centre contains nearly 100,000 sq.m of retail space, including Metro and Galleria department stores and a Hero hypermart. The centre also includes an ice skating rink. Mal Taman Anggrek is targeting a wider market than The PS.
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Leased Malls There are two major malls in Senayan, namely Plaza Senayan and the recently opened Senayan City. Situated just 2 kilometres southwest of the subject site, both malls contain around 80,000 sq.m of retail floor space each. Both centres target customers in the middle-upper income segment, with Plaza Senayan in particular targeting a slightly more affluent market. Mal Ciputra is situated 6 kilometres north of The PS. The mall is anchored by Batik Keris, Matahari and Hero. Given its size (51,000 sq.m) and market position (targeting middle to middle-upper households) this centre is the most similar to The PS when considering the major competing centres in the vicinity. Jakarta City Centre is located 3 kilometres north of the subject site. While the centre is near, it is of minimal competitive relevance due to its target market of the lower income segment; it is a strata mall anchored by a Hypermart but no department store. Plaza Indonesia is one of the most exclusive malls in Jakarta, situated 3 kilometres north of The PS. The centre contains 42,000 sq.m of mainly high-end retailing, including a Debenhams department store. The competitive environment of the trade area is expected to intensify over the next five years, with the planned development of a number of competing retail facilities. The competitive developments targeting middle and upper income households that are currently in the pipeline, which will add a combined 318,900 sq.m of retail floor space to the Jakarta CBD retail market, are scheduled for completion by the end of 2009. These include Grand Indonesia (due to open in the third quarter of 2007), Pacific Place (due to open in the third quarter of 2007), Kota Kasablanka and Plaza Indonesia Extension (both due to open in the fourth quarter of 2008). While these new projects could potentially impact the revenue growth that can be achieved at The PS, given its strategic geographic position in the centre of Jakarta, combined with the subject sites own development plans and its ability to withstand past changes to its competitive environment, these mainly upper new centres are expected to have a relatively small impact on the performance of the subject site.

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Leased Malls Table 4.2.5 Main competition, The Plaza Semanggi

Distance from Plaza Semanggi

Centre name

Type

NLA (sq.m)

Year opened

Anchor tenants

Mal Kelapa Gading . . . . . . . . . . Pondok Indah Mall 1 & 2 . . . . . . Mal Taman Anggrek . . . . . . . . . Senayan City . . . . . . . . . . . . . . . Plaza Senayan . . . . . . . . . . . . . Mal Ciputra . . . . . . . . . . . . . . . . Jakarta City Centre . . . . . . . . . . Plaza Indonesia . . . . . . . . . . . . Pasaraya Grande . . . . . . . . . . . Blok M Plaza. . . . . . . . . . . . . . . Grand ITC Permata Hijau . . . . . Mal Ambassador . . . . . . . . . . . . Future Competition Pacific Place . . . . . . . . . . . . . . . Grand Indonesia . . . . . . . . . . . . Citywalk Sudirman @ Cityloft. . . Main Street Gandaria . . . . . . . .

10 km 6 km 5 km 2 km 2 km 6 km 3 km 3 km 3 km 3 km 3 km 1 km 0.6 km 3 km 1.5 km 4.5 km

Lease Lease Lease Lease Lease Lease Strata Lease Lease Lease Strata Strata Lease Lease Lease Lease

130,000 100,000 97,000 80,000 76,000 51,000 50,000 42,000 42,000 32,000 30,000 30,000 75,000 108,000 17,300 94,000

1990 1991 1996 2006 1995 1993 2006 1990 1995 1990 2004 1997 2007 2007 2007 2008

Sogo, Diamon, Cinema 21 Giant, Sogo, Metro, Zara, Cinema 21 Galleria, Hero, Metro, Cinema 21 Debenhams, The Food Hall, Cinema 21 Hero, Metro, Sogo, Cinema 21 Batik Keris, Hero, Matahari, Cinema 21 Hypermart Debenhams, Food Hall Pasaraya, Hero, MPX Cinema Matahari, Hero, Cinema 21 Carrefour Matahari, Office One Metro, Kidzania Seibu, Harvey Nichols, Blitz Megaplex NA Metro, Fitness First, Studio 21, Amazone, Electronic Solutions NA Sogo, Fitness First NA NA NA

Plaza Indonesia Extension . . . . 3 km Kota Kasablanca . . . . . . . . . . . . 3.2 km Kemang Village . . . . . . . . . . . . . 4.5 km Sudirman Place. . . . . . . . . . . . . 1.3 km Epicentrum Walk . . . . . . . . . . . . 2.3 km Source: Jones Lang LaSalle Research and

Lease Lease Lease Lease Lease Consulting

25,386 62,000 65,000 31,000 26,200

2008 2008 2009 NA 2009

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Leased Malls 4.2.7 SWOT analysis Table 4.2.6 provides a summary of the strengths, weaknesses, opportunities and threats for The Plaza Semanggi. Table 4.2.6 SWOT analysis, The Plaza Semanggi
Strengths Weaknesses

The PS is prominently located in the heart of the Jakarta CBD, with good accessibility by private and public transport from all surrounding areas The centre has a diverse range of visitors, including local residents within the centres target market, the CBD workforce, students and other commuters The PS has a unique tenant mix, combining a traditional mall concept with long lease tenants. This allows the centre to cater for a wider range of customer segments and also diversifies the centres income stream The Centro department store is exclusive to The PS in Jakarta The lifestyle offering is extensive, in particular the selection of food and beverage retailers and the quality of the fitness centre Low rent arrears indicate good cash flow underpinned by strong trading performance
Opportunities

Similar to many Indonesian shopping centres, there is a shortage of parking space at peak times The centre can be difficult to navigate which may restrict optimal pedestrian flows The long lease precincts (particularly on level two) are underperforming relative to the rest of the centre and are negatively impacting on the integrity of the centres tenancy mix The centre is located in the 3 in 1 CBD area (enforced car pooling precinct) which could deter visitation by individuals travelling by private car during peak hours on weekday afternoons

Threats

Introduction of an open air retail concept, Plangi on the SkyPOTS, would further add to the unique range of retail concept offerings at The PS, and increase centre income

Future shopping centre development in Central Jakarta remains strong which will inevitably dilute the potential of some centres to maintain current market share

The opening of a busway interchange bridge to link Long lease tenancies may impact on the integrity of The PS with the busway interchange could improve the centres tenancy mix and target market position. occupancy levels on the second and third levels. Similar linkages to other adjoining facilities (i.e. university) would further improve accessibility, pedestrian flows and total centre income Further capitalising on The PSs central location by reinforcing The Best Meeting Point slogan could further increase shopper traffic and centre sales Further capitalising on the presence of Centro by increasing the prominence and interaction of Centro entrances with the rest of the mall Reacquiring long lease tenancies will assist in tighter adherence to tenant mix strategy Casual mall leasing can be more effectively utilised to integrate the offering with the rest of the centre Source: Jones Lang LaSalle Research and Consulting
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Leased Malls 4.2.8 Future outlook Despite the constant threat of new competition in the Jakarta retail market, the future outlook for The PS remains bright. The centres strategic location, combined with its unique tenancy mix, means that new entrants to the retail market in Jakarta are unlikely to compete directly with the subject site. Furthermore, The PS benefits from its relatively recent construction date (compared with older malls around Jakarta), meaning it is less likely to appear dated in comparison with new competitors. There are a number of strong, well advanced opportunities for The PS to improve upon its performance in the short to medium term. New retail concepts such as Plangi on the Sky, the proposal to add a 3,000 sq.m caf and restaurant, is one such opportunity which is well advanced. The opening of the busway interchange bridge, which will also include the addition of new tenants around one area of the centre which is currently underperforming, is another sound opportunity. Both of these proposals have the potential to assist centre management with reinforcing the tenancy mix, while they will also add to the centres vibrancy (thereby addressing the challenge posed by new shopping centre developments), diverse retail offering and income. Figure 4.2.5 The Plaza SemanggiCentre Atrium

Source: Jones Lang LaSalle Research and Consulting These factors all point to strong growth prospects for income growth at The PS in the short to medium term. Furthermore, it is considered that the PSs current rental positioning is below market, providing considerable upside for most tenancy categories at lease renewal. Considering these factors and the potential growth of retail spending in the trade area, average rents of PS are projected to grow at approximately 10-12% per year across 2007-2009. Table 4.2.7: Rental positioning, The Plaza Semanggi
Average current rents (Rp./sqm/month) Estimated range of market rents (Rp./sqm/month)

Tenancy category

Growth prospects

Anchor Tenants. . Major Tenants . . . Specialty Tenants F&B, Restaurants

. . . .

... ... ... ...

. . . .

55,000 72,000 219,000 216,000

50,000 - 60,000 70,000 - 100,000 225,000 - 275,000 200,000 - 250,000

Potential Potential Potential Potential

growth growth growth growth

upon upon upon upon

lease lease lease lease

renewal renewal renewal renewal

Source: Jones Lang LaSalle Research and Consulting Overall, The PS is well positioned to compete with new entrants to Jakartas growing retail market. The centre is well positioned in terms of its target market, with the centre targeting a slightly lower market than many of its existing and proposed competitors around central Jakarta. The centre is well positioned in
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Leased Malls terms of its very prominent and central geographic location, and centre management has proactively sought to capitalise on its positioning by exploring innovative ways to increase centre income. Overall, The PS is considered to be well placed to face new competitive threats, build upon its existing market and maximise its trading (and, therefore, its income producing) potential. 4.3 Bandung Indah Plaza 4.3.1 Regional context and local economy Bandung is the capital of West Java Province, the most populous province in Indonesia. It is located approximately 128 kilometres southeast of Jakarta and is connected to Jakarta by a toll road. The metropolitan area occupies an elevated basin some 770 metres above sea level, giving Bandung a relatively pleasant, cool climate. Bandung has a strong association with its Dutch colonial past. The Dutch influence can be seen through the Dutch colonial architecture prevalent in Bandung. Bandung is also famous for its textile industry, with numerous international labels having set up factories in the region. The city has become a popular weekend destination for residents from Jakarta, who are drawn to the factory outlets selling internationally famous designer brands and local designers clothes at low prices. Bandung has nearly 50 higher educational institutions, including numerous universities that attract students from throughout Indonesia and overseas. The most famous and oldest university is the Bandung Institute of Technology, which was established in 1920. Other well known institutions include the University of Parahyangan and the University of Pajajaran. Other industries associated with the Bandung region include agriculture (rice, tea etc.) and high-tech industries (aircraft, military and telecommunications). As at the 2000 National Census, the population of West Java was 35.7 million. This excludes the western part of the province, which was split in 2000 to form the province of Banten, and Jakarta, which is its own province. In 2006, the Bandung municipality had a population of approximately 2.3 million. 4.3.2 Description Bandung Indah Plaza (BIP) is a four level shopping centre with three basements. It is located in the heart of the Bandung CBD. The centre comprises two buildings and was developed in conjunction with the adjoining Hyatt Hotel in 1990. BIP is currently undergoing major refurbishment and re-configuration that will see the two existing buildings integrated and increase the NLA from approximately 26,472 sq.m to 30,315 sq.m. The work includes the following major changes: Four-storey extension to the northern end of the centre; Replacement of Yogya department store and supermarket with additional specialty retailers; New Hypermart on the ground floor, replacing the previous ground floor space and occupied by Matahari specialty tenants; Additional floor created for Matahari (Level 1 split into Level 1-a and 1b); New food court in former level 3 Matahari space, replacing smaller food court on this level; Creation of plaza area in front of ground floor shops, providing opportunities for al fresco dining; Improved pedestrian movement via additional escalators, travelator to basement parking and integration of the two buildings; and, Additional parking in basement through relocation of centre management offices.
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Leased Malls Table 4.3.1 provides details of the centre. Figure 4.3.1 Bandung Indah PlazaImages

Source: Jones Lang LaSalle Table 4.3.1 Centre details, Bandung Indah Plaza
Characteristics

Address . . . . . . . . . . . . . . . . . Year Opened . . . . . . . . . . . . . Last Refurbishment/Extension. NLA (sq.m): . . . . . . . . . . . . . . Site Area (sq.m) . . . . . . . . . . . Car Parking . . . . . . . . . . . . . . Motor Cycle Parking . . . . . . . . Levels. . . . . . . . . . . . . . . . . . . Opening Hours . . . . . . . . . . . . Occupancy Rate . . . . . . . . . . .

. . . . . . . . . .

Jl. Merdeka 1990 On-going 26,472 (30,315 following extension) 15,779 602 700 4 (retail), 3 (basement) 10am - 10pm 83.2% (as at 30 June 2007) Hypermart, Matahari Cinema 21, Toko Gunung Agung, Timezone McDonalds, Body Shop, Giordano, Quiksilver, Starbucks, Polo Ralph Lauren, Adidas, Levis, A&W, Rice Bowl, X-Treem 180 Weekdays: 30,000 Weekends: 40,000

Major Retail Tenants: Majors . . . . . . . . . . . . . . . . . . . Mini Majors . . . . . . . . . . . . . . . . Selected Other . . . . . . . . . . . . . Total Retail Tenancies . . . . . . . . Shopper Traffic . . . . . . . . . . . . .

Source: Jones Lang LaSalle Research and Consulting, PT. Lippo Karawaci, Tbk

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Leased Malls Figure 4.3.2 Bandung Indah Plaza: internal images

Source: Jones Lang LaSalle Research and Consulting 4.3.3 Tenant mix The current renovation has provided centre management with an opportunity to change the tenancy mix of BIP . The centre previously comprised two department stores and one supermarket. While this provided relatively strong anchors, it limited the number and range of specialty shops as the majority of space was taken up by anchor tenants. The centre provides a one stop shopping destination with a good mix of everyday convenience retailers and specialty retailers. The mix is skewed towards the large youth market, given the location of nearby universities in Bandung. Youth fashion, lifestyle, entertainment and food and beverage offerings are all relatively strong. There is significant potential to consolidate BIPs strong destination appeal for youth by attracting additional tenants that cater to this market. At the same time, centre management has indicated a desire to increase its offerings for young families. Areas that could be targeted include electronics and homewares. There is no fitness centre, because of its large space requirement. However, this is mitigated by the higher rents available from specialty tenants. Table 4.3.2 Tenancy mix by level, Bandung Indah Plaza Source: Jones Lang LaSalle Research and Consulting
Level Tenant mix (post renovations)

Ground . First . . . Second. Third. . .

. . . .

. . . .

. . . .

. . . .

. . . .

. . . .

. . . .

. . . .

. . . .

. . . .

. . . .

. . . .

. . . .

. . . .

. . . .

. . . .

. . . .

. . . .

. . . .

. . . .

. . . .

. . . .

. . . .

. . . .

. . . .

. . . .

. . . .

. . . .

. . . .

. . . .

. . . .

Hypermart, Branded Fashion & Accessories, Cafes Matahari, Lifestyle, Fashion Matahari, Toko Gunung Agung, Lifestyle, Hobbies Cinemas, Timezone, Food Court

Source: Jones Lang LaSalle Research and Consulting The Ground Floor is anchored by Hypermart, which accounts for 16.9% of the NLA and 6.5% of the centres gross rental income. Specialty retailers on this level include food and beverage outlets (McDonalds, Starbucks) and fashion and accessories retailers, including Quiksilver and Giordano. Level 1 is anchored by Matahari, which accounts for 22.8% of NLA and 11.6% of gross rental income. Matahari extends across three floors. Youth fashion retailers are well represented, including City Surf and
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Leased Malls Levis. Vacant tenancies created from the former Yogya department store provide opportunities to consolidate the fashion offering on this level. Level 2 is anchored by the top level of the Matahari Department Store and Toko Gunung Agung bookstore. Lifestyle retailers such as X-Treem and MG Music cater to the youth segment. A Yogya supermarket anchors the southern end of this level, but it will be replaced upon its lease expiry with additional specialty retailers in 2008. Level 3 provides the centres major entertainment offering, comprising Cinema 21 (6 screens), Timezone and a new food court, created in the former Matahari Department Store space. Other food tenancies are also on this level. Table 4.3.3 Major Tenants as at 30 June 2007, Bandung Indah Plaza
Tenant Expiry date % Gross monthly rent

Matahari . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Hypermart . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Toko Buku Gunung Agung . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . McDonalds. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Rice Bowl . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Extreme Store. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Felice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Cinema 21 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Texas Chicken . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Timezone . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Other tenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Total Centre . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

31-May-15 31-May-15 23-May-11 16-May-09 29-Jun-11 15-Sep-11 16-Mar-11 31-Dec-15 4-Aug-13 31-May-15 Varies

11.6% 6.5% 3.9% 2.4% 2.2% 2.2% 1.9% 1.6% 1.4% 1.4% 64.9% 100.0%

Source: Jones Lang LaSalle Research and Consulting, PT. Lippo Karawaci, Tbk Note: Yogya Supermarket to be replaced with specialty retailing 4.3.4 Target market BIP targets the middle to middle-upper income market, particularly the youth market. The tenancy mix is considered appropriate for this target market, providing a mix of local, national and internationally branded retailers. The centre also caters to a relatively large local workforce, being centrally located in the CBD. 4.3.5 Trade area analysis To assist with the definition of trade areas, a market research survey of visitors to the major leased malls was undertaken in February and March 2007. A total of seven (7) centres were included in the study. The surveying was conducted by TNS on behalf of Jones Lang LaSalle for the purposes of this assessment. The main findings of the market research in relation to the profile of shoppers at BIP is as follows: BIP is the most popular centre in the portfolio with young couples, a reflection of the youthful characteristics of the customer profile, especially during weekdays. Older people (30-40 years) generally visit the centre during weekends; As with all centres in the portfolio, Saturdays and Sundays are the most popular days to visit BIP . Peak hours are between 12:00 and 16:00. Most customers spend between one and three hours in the centre; Approximately 50% of BIPs customers visit the centre at least once a week; The most popular reason given for visiting BIP is sightseeing or comparison shopping. A high proportion of customers indicated they visited BIP to watch a movie;
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Leased Malls In terms of reasons for choosing BIP , accessibility is the key reason, including good access via public transport and close proximity to school/college. The centre is perceived to have a complete mix of stores and is a popular meeting place for the younger generation; Visitors surveyed were generally very satisfied with facilities, the tenancy mix and the level of security at BIP . The trade area for BIP has been defined based on the findings of customer origin from the market research survey, the strength of the subject site, the location and relative strength of competing retail facilities and accessibility to the centre, including the road network, public transport and physical barriers. Based on these considerations, the centres PTA has been defined to cover a number of areas. According to the market research survey, the areas where the level of market penetration is highest for BIP are Coblong, Sukasari, Bandung Wetan, Cibeunying Kidul, Sumur Bandung, Cicadas and Lengkong. The secondary catchment includes areas where BIP attracts visitors from, however the level of customer draw (market share penetration) is below the level achieved in the PTA. Areas considered to fall within the STA include Pancoran Mas, Serang Baru, Gunung and Putri. The trade area, including major competing centres within the trade area, is illustrated in the below map. Figure 4.3.3 Bandung Indah Plaza trade area
1. 2. 3. 4. 5. 6. 7. Istana Plaza Bandung Trade Center Bandung Supermall Ciwalk (Cihampelas Walk) Dago Plaza Parisj Van Java Riau Junction

3 Km

6 2 4 5 1 7

Source: Jones Lang LaSalle Research and Consulting & RTRW Kota Bandung (Pemkot Bandung) As at 2005, the PTA included a population of 534,000 persons while the STA included a further 562,000 persons. Based on recent population trends in the area, the primary and secondary trade areas are forecast to grow by 1.0% per annum between 2007 and 2011, increasing to an indicative forecast population of 566,000 (PTA) and 597,000 (STA) respectively. The target market for BIP are middle and upper income households, which represent 90% of all households in the PTA and 81% of households in the STA.

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Leased Malls Trade area retail spending and forecast retail spending growth is summarised in Table 4.3.4 below. Together with modest population growth, total retail spending in the PTA and STA is expected to grow by 5.0% per annum between 2007 and 2011. Table 4.3.4 Bandung Indah plaza trade area: population growth and spending forecasts Source: AC Nielsen; Economic Intelligence Unit; Jones Lang LaSalle Research and Consulting
2007 (f) 2011 (f) % Growth 20072011 (p.a.)

Primary Trade Area . . . . . . . . . . . . . . . .

Secondary Trade Area . . . . . . . . . . . . .

Population Households* Retail Spending per Household (Rp. Million) Total Retail Spend (Rp. Billion) Population Households* Retail Spending per Household (Rp. Million) Total Retail Spend (Rp. Billion)

544,313 124,947

566,187 129,968

1.0% 1.0%

19.5 2,436 573,521 97,213

22.8 2,965 596,569 101,119

4.0% 5.0% 1.0% 1.0%

19.5 1,895

22.8 2,307

4.0% 5.0%

* Note: Total Households and Retail spending market only includes only those households assumed to fall within the target market (i.e., AC Nielsen Socio Economic Status (SES) categories A to C, described as middle and upper income households). Spend market at 2007 prices (i.e. 2011 spend market at 2007 prices; average annual retail spending per household and total retail spend market growth forecasts are real, not nominal, growth, excluding the effects of inflation) Source: AC Nielsen; Economic Intelligence Unit; Jones Lang LaSalle Research and Consulting 4.3.6 Competition BIP is the most visited mall amongst its customers, with 57% of respondents surveyed reporting the subject site as the centre they visit most often. The main competing centres to BIP are summarised in Table 4.3.5 and discussed below: Bandung Supermal is considered the centre of greater competitive relevance, according to the market research undertaken. The centre targets the upper income market in Bandung and is anchored by Metro and Giant Hypermarket. It has a strong entertainment offering, including cinemas, bowling and Kota Fantasi. It is the largest shopping centre in the metropolitan area with an NLA of 48,800 sq.m, and is approximately 4 kilometres south east of BIP . It is considered that Bandung Supermal will primarily compete for discretionary spending from the upper income market rather than weekly convenience shopping. Riau Junction (Yogya) is less than 1 kilometre north of BIP . At the time of the market research, only the Yogya supermarket at Riau Junction was opened. This centre will be fully opened by mid 2007 and will include a Yogya department store on levels 1 and 2 and food retailers on level 3. Its small size (approximately 6,400 sq.m) and limited offering suggests it will primarily compete with the department store, supermarket and food & beverage retailers at BIP rather than the whole centre. Istana Plaza is approximately 2 kilometres west of BIP and comprises over 27,000 sq.m of NLA over five levels. The centre is anchored by a small Hero supermarket, Rimo department store and Ace Hardware and targets the middle to middle-upper income market. Paris Van Java, a recently opened centre, has the potential to increase its competitive relevance once all tenancies are occupied and established. This centre has strong anchor tenants in Sogo and Carrefour
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Leased Malls and approximately 38,000 sq.m of NLA. Its lifestyle offering is quite strong, including Bandungs only Blitz Megaplex cinemas. It is approximately 4 kilometres north west of BIP , which is considerably further from BIP than other competitors such as Istana Plaza. There are no known major shopping mall developments approved or under construction in the Bandung metropolitan area. However, given the relative strength of retail supply in recent years, particularly in Greater Jakarta, it is possible that further centres will be developed. Major drivers will be the continued expansion plans of major international and national department store and hypermart chains into the main metropolitan areas of Indonesia. Table 4.3.5 Main competition, Bandung Indah Plaza
Dist. from Bandung Indah Plaza NLA (sq.m) Year open

Centre name

Type

Anchor tenants

Istana Plaza . . . . . . . . . . . Bandung Supermal . . . . . . Riau Junction . . . . . . . . . . Cihampelas Walk . . . . . . . Paris Van Java . . . . . . . . .

2 km 4 km 1 km 2 km 4 km

Lease Lease Lease Lease Lease

27,247 48,800 6,400 28,400 38,000

2001 2001 2007 2004 2006

Rimo, Hero, Ace Hardware Metro, Giant, Kota Fantasi, Cinemas, GUBA (bowling) Yogya supermarket & department store Yogya supermarket & department store, Cinemas Sogo, Carrefour, Blitz Megaplex

Source: Jones Lang LaSalle Research and Consulting 4.3.7 SWOT analysis Table 4.3.6 provides a summary of the strengths, weaknesses, opportunities and threats for BIP . Table 4.3.6 SWOT analysis, Bandung Indah Plaza
Strengths Weaknesses

Central location with good accessibility from Jl. Merdeka to metropolitan population of Bandung as well as nearby working population. Well established centre and well regarded as a meeting place for Bandung residents, particularly its large student population. Strong youth retail offer, serving the local student population. Comprehensive one stop shopping centre with full range of convenience and comparison shopping.

Parking space is in high demand and regularly at above full capacity. Entertainment offer not considered as strong as some of its competition

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Leased Malls
Opportunities Threats

Existing renovation and extension provides opportunities to consolidate in the youth segment, improve entertainment and F&B offer and attract additional mini-major anchors (eg. large format sports stores, and electronics stores) Increased parking provision by relocating centre management offices out of basement. Fully utilising plaza area for al fresco dining and open air activities/special events. This reinforces BIP as the meeting place for Bandung.

Potential for new centres to come into the market and compete in the middle income target market. Strong new competition in the leisure and lifestyle area from Bandung Supermal (which is constructing an adjoining snow centre) and Paris van Java (Blitz Cinemas, al fresco dining)

Source: Jones Lang LaSalle Research and Consulting 4.3.8 Future Outlook There is considerable upside for the trading performance in the short to medium term at BIP due to the current renovations. While there is considerable space remaining to be leased, the centre has the benefit of a very good location in the centre of Bandung and is well established in the local market. Its strength in the youth segment should be consolidated as a result of the current upgrade. The reconfiguration of the Matahari Department Store provides an opportunity to better integrate this store with the main building fronting Jl. Merdeka. While the loss of Yogya, particularly on level 1 and 2, has removed a destination anchor from the southern end of the centre, the reconfigured floor plans provide an opportunity to greatly increase the level of specialty retailing and rental income. Attracting high profile specialty retailers and mini anchor stores (for example sports stores, and electronics stores) will assist in generating foot traffic and leasing up these areas. The plaza area provides significant potential to attract major F&B retailers, which in turn should attract additional customers to the centre. The refurbished plaza should reinforce BIP as the meeting place in Bandung. Parking at the centre remains an issue, despite additional spaces being available nearby. Additional spaces created through the removal of the basement centre managers office will partially relieve the parking congestion. Current rental positioning at BIP is considered to be at the high side of market rentals, suggesting that income growth prospects may be limited in the short term. It is considered, however, that the re-positioning of the centre, which will change the tenant balance in favour of higher rental generating specialty and F&B tenants, should have an overall positive influence on rental income in the short to medium term. Considering these factors and the potential growth of retail spending in the trade area, average rents of BIP are projected to grow at approximately 11-13% per year across 2007-2009. Table 4.3.7: Rental positioning, Bandung Indah Plaza
Average current rents (Rp./sqm/month) Estimated range of market rents (Rp./sqm/month)

Tenancy category

Growth prospects

Anchor Tenants. . . . . . .

50,000

40,000 - 50,000

Major Tenants . . . . . . . . Specialty Tenants . . . . . F&B, Restaurants . . . . .

112,000 334,000 214,000

80,000 - 110,000 200,000 - 325,000 225,000 - 280,000

New Hypermart and renovated Matahari should improve overall centre performance Potential growth upon rental review Centre re-positioning will increase proportion of specialty tenants Centre re-positioning will increase proportion of F&B

Source: Jones Lang LaSalle Research and Consulting

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Leased Malls While BIP is likely to continue to be subject to new competition, it has retained its strong position as one of the metropolitan areas most favoured retail destinations by virtue of its central location, popularity with the youth segment and strong tenancy mix. Current redevelopment should consolidate BIPs position as a major shopping destination in Bandung, despite new competition. 4.4 Istana Plaza 4.4.1 Regional context and local economy Bandung is the capital of West Java Province, the most populous province in Indonesia. It is located approximately 128 kilometres southeast of Jakarta and is connected to Jakarta by a toll road. The metropolitan area occupies an elevated basin some 770 metres above sea level, giving Bandung a relatively pleasant, cool climate. Bandung has a strong association with its Dutch colonial past. The Dutch influence can be seen through the Dutch colonial architecture prevalent in Bandung. Bandung is also famous for its textile industry, with numerous international labels having set up factories in the region. The city has become a popular weekend destination for residents from Jakarta, who are drawn to the factory outlets selling internationally famous designer brands and local designers clothes at low prices. Bandung has nearly 50 higher educational institutions, including numerous universities that attract students from throughout Indonesia and overseas. The most famous and oldest university is the Bandung Institute of Technology, which was established in 1920. Other well known institutions include the University of Parahyangan and the University of Pajajaran. Other industries associated with the Bandung region include agriculture (rice, tea etc.) and high-tech industries (aircraft, military and telecommunications). As at the 2000 National Census, the population of West Java was 35.7 million. This excludes the western part of the province, which was split in 2000 to form the province of Banten, and Jakarta, which is its own province. In 2006, the Bandung municipality had a population of approximately 2.3 million. 4.4.2 Description Commencing operation in November 2001, Istana Plaza (IP) has quickly become a major community focus for the northern and western region of Bandung, including the large local Chinese population. The centre provides a relatively comprehensive retail offering targeting the middle to middle-upper income residents in this region. The centre is located at the junction of two busy roads, Jl. Pasir Kaliki and Jl. Pajajaran, and is considered one of the major modern shopping malls serving the population of Bandung. It is approximately 2 kilometres west of the centre of Bandung. IP comprises four retail levels and two basements with a total NLA of 27,247 sq.m. Table 4.4.1 provides details of the centre.

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Leased Malls Figure 4.4.1 Istana Plaza, Bandung

Source: Jones Lang LaSalle Table 4.4.1 Centre details, Istana Plaza
Characteristics

Address. . . . . . . . . . . . . . . . . . . . Year Opened . . . . . . . . . . . . . . . . Last Refurbishment / Extension . . Net Lettable Area (sq.m): . . . . . . Site Area (sq.m): . . . . . . . . . . . . . Car Parking . . . . . . . . . . . . . . . . . Motor Cycle Parking . . . . . . . . . . Levels . . . . . . . . . . . . . . . . . . . . . Opening Hours . . . . . . . . . . . . . .

. . . . . . . . .

Occupancy Rate . . . . . . . . . . . . . . Major Retail Tenants: Majors . . . . . . . . . . . . . . . . . . . . . . Mini Majors . . . . . . . . . . . . . . . . . . Selected Other . . . . . . . . . . . . . . . Total Retail Tenancies . . . . . . . . . . Shopper Traffic . . . . . . . . . . . . . . .

Corner Jl. Pajajaran & Jl. Pasir Kaliki 2001 Minor renovations underway 27,247 13,082 700 500 4 (retail), 2 (basement) 10am - 9.30pm Weekdays 10am - 10pm Weekends 98.9% (as at 30 June 2007) Rimo Department Store, Hero Supermarket, Ace Hardware Gramedia, Eastern Restaurant, Agis Electronics, Game Master Pizza Hut, Adidas, Body Shop, Fila, Giordano, Nike, The Executive, McDonalds, Bread Talk, Charles & Keith, Nautica 205 15 - 20,000 Weekdays 25 - 30,000 Weekends

Source: Jones Lang LaSalle Research and Consulting, PT. Lippo Karawaci, Tbk

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Leased Malls Figure 4.4.2 Istana Plaza: images

Source: Jones Lang LaSalle Research and Consulting 4.4.3 Tenant mix IP is a well established centre with a loyal customer profile. It has proved to be popular with the local Chinese community as well as young families. It caters to its primary customer base through its strong tenancy mix, which includes a strong offering of food, fashion and accessories, and childrens fashion and entertainment. Since opening, the centre has enjoyed a high occupancy rate, which currently sits at approximately 98.9%. The tenancy mix provides a one stop shopping destination, with three anchor tenancies (Rimo, Hero, ACE Hardware), lifestyle and entertainment mini-anchors and a wide range of specialty tenants. Notable exclusions from the tenancy mix are cinemas and a fitness centre. With a large hardware store and electronics store (Agis Electronics), the centre caters particularly well to male shoppers. This is reinforced further with popular male fashion brands such as The Executive and Nautica. The lower ground floor is anchored by a small Hero Supermarket. There is direct access to parking on this level and a number of small tenancies and casual leasing. These small tenancies are particularly popular with the youth segment. A group of external shops are located on this level, including Pizza Hut, banks and Holland Bakery. The ground floor is anchored by ACE Hardware and includes branded fashion and a range of cafes and restaurants (Eastern Restaurant). The atrium area is utilised for casual leasing, events and exhibitions. This creates a busy market atmosphere within the centre of the mall. Level 1 is anchored by Rimo department store. There is a large childrens themed area, which has fashion and entertainment uses. Agis Electronic provides a further anchor on this level. Major fashion brands such as Nautica, Planet Surf and The Executive are present, providing a focus for the male shopper. Level 2 comprises the second level of Rimo, addition fashion retailers as well as some food and beverage offerings, including Gloria Jeans and Solaria. Level 3 comprises Bandungs only ice skating rink, the centres food court and a range of other lifestyle and entertainment retailers, including Gramedia bookstore, Game Master and Disc Tarra. A mezzanine dining area overlooks the ice skating arena. The centre manager has indicated that Level Three is proposed to be redeveloped, with the removal of the ice skating rink, providing an opportunity to strengthen the food and entertainment offering of the centre.
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Leased Malls Table 4.4.2 Tenancy mix by level, Istana Plaza

Level Tenant mix

Lower Ground. Ground . . . . . . First . . . . . . . . Second . . . . . . Third . . . . . . . .

. . . . .

. . . . .

. . . . .

. . . . .

. . . . .

. . . . .

. . . . .

Hero Supermarket, External tenancies, ATMS, Small Casual Leasing area ACE Hardware, Restaurants, Branded Fashion, Exhibition space Rimo, Childrens play area, Branded fashion Fashion, Accessories LifestyleBooks, Games, Game Master, Ice Skating, Food Court

Source: Jones Lang LaSalle Research and Consulting Compared to other modern shopping malls, the anchor tenants are relatively small and account for a relatively small proportion of NLA and gross rental income. The centre, however, has particularly strong mini-anchors and has consistently achieved high occupancies, suggesting that the anchor tenants are providing sufficient destination appeal to the centre. It is noted that the Hero Supermarket is relatively small, with an NLA of only 1,341 sq.m, which restricts the product lines that it can carry. This may see customers using the supermarket for top up style grocery shopping rather than major weekly grocery shopping. Table 4.4.3 Major tenants as at 30 June 2007, Istana Plaza
Tenant Expiry Date % of Gross Monthly Rent

Rimo. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Ace Hardware . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Gramedia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Game Master . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Giovanni . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Pizza Hut . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Planet Sport . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Other tenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Total Centre . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . .

28-Feb-12 28-Feb-12 29-Feb-12 30-Nov-11 29-Jan-12 29-Jan-12 29-Nov-11

11.5% 6.5% 3.6% 3.1% 2.1% 2.0% 1.9% 69.3% 100.0%

Source: Jones Lang LaSalle Research and Consulting, PT. Lippo Karawaci, Tbk 4.4.4 Target market IP targets the primarily middle and middle-upper income segment within the region. A particular focus are families and the local Chinese community. To cater for this target market, the centre has attracted a relatively strong mix of well known, internationally branded retailers in the areas of fashion and food to the centre. 4.4.5 Trade area analysis To assist with the definition of trade areas, a market research survey of visitors to the major leased malls was undertaken in February and March 2007. A total of seven (7) centres were included in the study. The surveying was conducted by TNS on behalf of Jones Lang LaSalle for the purposes of this assessment. The main findings of the market research in relation to the profile of shoppers at IP is as follows: Customers tend to be from the higher income groups with a large number of college students, people aged under 25 and a significant Chinese customer group; IP has the lowest percentage of all centres in the portfolio visiting the centre primarily for supermarket shopping. As noted, the Hero supermarket is relatively small compared to larger comprehensive supermarkets; Approximately two thirds of customers spend between one and three hours at the centre; IP appears to be frequented for less multi-purpose trips than other centres within the portfolio. This suggests there is scope to increase the length of stay in the centre by increasing the reasons for customers to visit the centre;
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Leased Malls The main reason stated for visiting IP was its comfortable atmosphere followed by its proximity from home and accessibility; Personal transport (motorcycle, car) was the main form of transport used to visit the centre; Overall satisfaction level at the centre was relatively high; As with all centres in the portfolio, IP is primarily a weekend destination mall; Peak trading hours tend to be between 12:00 and 17:00; IPs main competition, based on other malls visited by survey respondents, was BIP (Bandung Indah Plaza). Paris van Java and Bandung Supermal are also frequently visited by a significant proportion of those surveyed. The trade area for IP has been defined based on the findings of customer origin from the market research survey, the strength of the subject site, the location and relative strength of competing retail facilities and accessibility to the centre, including the road network, public transport and physical barriers. Based on these considerations, the centres PTA has been defined to cover a number of areas. According to the market research survey, the areas where the level of market penetration is highest for IP are the northern and western suburbs of Bandung. Sub-districts within the PTA include Cicendo, Sukasari, Sukajadi, Coblong, Andir, Cimahi, Cimahi Selatan, Soreang, Sumur Bandung, Cidadap and Bandung Kulon. The secondary catchment includes areas where IP attracts visitors from, however the level of customer draw (market share penetration) is below the level achieved in the PTA. Areas considered to fall within the STA include Cimahi Utara, Cimahi Tengah, Batununggal, Regol and Cicadas. The trade area, including major competing centres within the trade area, is illustrated in the below map. Figure 4.4.3: Istana Plaza trade area
1. 2. 3. 4. 5. 6. 7. Bandung Indah Plaza Bandung Trade Center Bandung Supermall Ciwalk (Cihampelas Walk) Dago Plaza Paris Van Java Riau Junction
3 Km

6 2 4 5 7 1

Source: Jones Lang LaSalle Research and Consulting & RUTR Kota Bnadung (Pemkot Bandung) As at 2005, the PTA included a population of 389,000 persons while the STA included a further 480,000 persons. Based on recent population trends in the area, the primary and STAs are forecast to grow by 1.0% per annum between 2007 and 2011, increasing to an indicative forecast population of 412,000 (PTA) and 509,000 (STA). The target market for IP is middle and upper income households, which represent 92% of all households in the PTA and 83% of households in the STA. Centre management indicated that the PTA has a particularly
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Leased Malls strong and loyal Chinese customer base, which was also confirmed through market research. This group comprises a high percentage of high income households. Trade area retail spending and forecast retail spending growth is summarised in Table 4.4.2 below. Together with modest population growth, total retail pending in the PTA and STA is expected to grow by 5% per annum between 2007 and 2011. Table 4.4.4 Istana Plaza trade area: population growth and spending forecasts
% Growth 2007-2011 (p.a.)

2007 (f)

2011 (f)

Primary Trade Area . . . . . . .

Population Households* Retail Spending per Household (Rp. Million) Total Retail Spend (Rp. Billion) Population Households* Retail Spending per Household (Rp. Million) Total Retail Spend (Rp. Billion)

396,430 99,525 19.5 1,940 489,545 84,824 19.5 1,654

412,361 103,524 22.8 2,362 509,218 88,233 22.8 2,013

1.0% 1.0% 4.0% 5.0% 1.0% 1.0% 4.0% 5.0%

Secondary Trade Area . . . . . . .

* Note: Total Households and Retail spending market only includes only those households assumed to fall within the target market (i.e., AC Nielsen Socio Economic Status (SES) categories A to C, described as middle and upper income households). Spend market at 2007 prices (i.e. 2011 spend market at 2007 prices; average annual retail spending per household and total retail spend market growth forecasts are real, not nominal, growth, excluding the effects of inflation) Source: AC Nielsen; Economic Intelligence Unit; Jones Lang LaSalle Research and Consulting 4.4.6 Competition IP is the most visited mall amongst its customers, with 52% of respondents surveyed reporting the subject site as the centre they visit most often. The main competing centres to IP are summarised in Table 4.4.5 and discussed below: Bandung Indah Plaza is approximately 2km east of IP and comprises 30,315 sq.m of NLA (following extension) across four levels. The centre is anchored by a Hypermart and Matahari Department Store. It is currently undergoing renovations which will increase the range of specialty retailers present as well as upgrade the entertainment and lifestyle offering in the centre. According to the market research survey of visitors to IP , Bandung Indah Plaza is the centre of most competitive relevance, targeting a similar market segment to IP (middle to middle-upper income market). Bandung Supermal is the largest shopping centre in the metropolitan area of Bandung with an NLA of 48,800 sq.m NLA, and is located approximately 6km south east of IP . The centre targets the upper income market in Bandung and is anchored by Metro department store and Giant Hypermart. It has a strong entertainment offering, including cinemas, bowling and Kota Fantasi. Given the large considerable distance between the two centres, Bandung Supermal will primarily compete for discretionary spending from the upper income market rather than weekly convenience shopping and may attract visitors from a wide area to its family oriented entertainment offerings. Paris Van Java, a recently opened centre, It is approximately 2km north of IP . It has the potential to increase in competitive relevance once all tenancies are occupied and established. The centre comprises strong anchor tenants in Sogo department store and Carrefour and approximately 38,000 sq.m of floor area. Its lifestyle offering is stronger than IP and includes Bandungs only Blitz Megaplex cinemas. The centre targets the middle-upper income market.
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Leased Malls Cihampelas Walk is located 2km north east of IP . The open air centre of approximately 28,400 sq.m has a significant lifestyle focus, with al fresco dining and cinemas. It also comprises a Yogya department store and supermarket. The centre targets the middle and middle-upper market. Riau Junction (Yogya) is approximately 2km east of IP . At the time of the market research, only the Yogya supermarket at Riau Junction was opened. This centre will be fully opened by mid 2007 and will include a Yogya department store on levels 1 and 2 and food retailers on level 3. Its small size (approximately 6,400 sq.m) and limited offering suggests it will not be a major competitive threat to IP , but it does strengthen the overall retail offering within the Bandung CBD, being near Bandung Indah Plaza. Each of IPs four major competitors has cinemas and as a result it could be argued that they provide a more complete entertainment offering. However, IP enjoys a higher occupancy rate than its major competition, suggesting that it has successfully provided the right combination of retailers for its target market. Other shopping centres within the trade area do not tend to provide the full range of shopping that is available at IP . There are no known major shopping mall developments approved or under construction in Bandung. However, given the relative strength of retail supply in recent years, particularly in Greater Jakarta, it is possible that further centres will be developed. Major drivers will be the continued expansion plans of major international and national department stores and hypermart chains in the main metropolitan areas of Indonesia. Table 4.4.5: Main competition, Istana Plaza
Distance from Istana Plaza

Centre name

Type

NLA (sq.m)

Year open

Anchor tenants

Bandung Indah Plaza . . . . . .

2 km

Lease

Bandung Supermal . . . . . . . Paris Van Java . . . . . . . . . . . Cihampelas Walk . . . . . . . . .

6 km 2 km 2 km

Lease Lease Lease

30,315 (following extension) 48,800 38,000 28,400

1990

Matahari, Hypermart, Yogya supermarket, Studio 21 Metro, Giant, Kota Fantasi, Cinemas, GUBA (bowling) Sogo, Carrefour, Blitz Megaplex Yogya supermarket & department store, Cinemas

2001 2006 2004

Source: Jones Lang LaSalle Research and Consulting 4.4.7 SWOT analysis Table 4.4.6 provides a summary of the strengths, weaknesses, opportunities and threats for IP . Table 4.4.6 SWOT analysis, Istana Plaza
Strengths Weaknesses

Strategically located at the junction of two main roads. It has a loyal customer base and strong appeal from the large Chinese population It acts as a community hub for the middle-upper residential community within close proximity to the centre Provides a unique and comprehensive tenancy mix including Ace Hardware store and Agis Electronic, catering well to both male and female shoppers

The Hero supermarket is relatively small at 1,341 sq.m, significantly smaller than the competition There are no cinemas or fitness centre, which would appeal to customers otherwise Parking can be very difficult on weekend, although adjacent sites provide additional capacity

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Leased Malls
Opportunities Threats

While the tenancy mix is generally very good, an opportunity exists to improve the entertainment/lifestyle offering by removing the skating rink. The centre manager has indicated that an improved F&B offering is planned There is potential to introduce cinemas to Level 3 if such a facility was deemed feasible. However, generated income from such a use is likely to be lower than specialty retailers Improvements to parking and access will help maintain customer loyalty Source: Jones Lang LaSalle Research and Consulting 4.4.8 Future outlook

Paris Van Java is very close, has an abundance of parking, strong anchor tenants, outdoor dining as well as Bandungs only Blitz Cinema complex. Once fully functional and established, it poses strong competition Other potential new competition may directly compete for customers, particularly in the core northern and western Bandung trade areas

IP faces considerable competition from centres that provide a strong entertainment and lifestyle offer, such as Bandung Supermal, Bandung Indah Plaza, Paris van Java and Cihampelas Walk. Improvements to the F&B offering through the redevelopment of the under-utilised skating rink should improve the entertainment offering and also help increase the average length of stay per visit and average spend per customer. The centre is well established and has consistently achieved a very high occupancy rate with significant enquiry from new tenants looking to establish themselves at the centre. The high level of lease expiries in 2007 provides considerable upside for the centre to build on its already strong tenancy mix, target new tenants with destinational appeal and grow rental income. The lack of parking space within the centre remains an issue. However, centre management has negotiated with an adjoining land owner to gain access to additional parking spaces. This has alleviated congestion at the centre, particularly on weekends. As indicated below, the current rental positioning for anchor tenants, majors and specialty tenants are all considered to be on the low side of the market rentals and, specifically, considerably below one of its main competitors, Bandung Indah Plaza. Furthermore, the re-positioning of level 3 provides an opportunity to increase the number and range of specialty, F&B and restaurant tenancies and to grow rental income through increasing the proportion of higher income generating uses. This should also have a positive impact on shopper traffic and future income growth of existing tenants. Table 4.4.7: Rental positioning, Istana Plaza
Average current rents (Rp./sqm/month) Est. range of market rents (Rp./sqm/month)

Tenancy category

Growth prospects

Anchor Tenants . . Major Tenants . . . Specialty Tenants F&B, Restaurants

. . . .

.. .. .. ..

... ... ... ...

. . . .

39,000 64,000 168,000 100,000

40,000 - 45,000 50,000 - 70,000 180,000 - 200,000 175,000 - 200,000

Potential growth on lease renewal Potential growth on lease renewal Potential growth on lease renewal Re-positioning on Level Three to improve offer and rental growth prospects

Source: Jones Lang LaSalle Research and Consulting On balance, IPs strengths far outweigh its weaknesses and there are opportunities to improve the centre further, building on its already strong tenancy profile. The most obvious opportunity in the short to medium term is the redevelopment of the Level 3 ice skating rink to improve the entertainment and lifestyle offering on this level. Considering these factors and the potential growth of retail spending in the trade area, average rents of IP are projected to grow at approximately 12-15% per year across 2007-2009.
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Leased Malls Figure 4.4.4: Istana Plaza at night

Source: Jones Lang LaSalle Research and Consulting 4.5 Mal Lippo Cikarang 4.5.1 Regional context and local economy Cikarang is part of Greater Jakarta and is located in West Java, the most populous province in Indonesia. Lippo Cikarang, near Bekasi, was founded in 1993 and has been developed as a self contained satellite city in Greater Jakarta. The estate comprises industrial, commercial and residential elements and has attracted around 600 companies, including many overseas manufacturers taking advantage of the lower cost of manufacturing in Indonesia. Its main shopping centre is Mal Lippo Cikarang (MLC). Lippo Cikarang is home to 25,000 residents and approximately 65,000 jobs. It is approximately 40 kilometres east of Jakarta and is connected to Jakarta via the Jakarta-Cilkampek toll road. The Cikarang Industrial Estate focuses on clean light and hi-tech industries. Examples include batik producers, cosmetics manufacturers and assembly factories for automobiles, motorcycles and computers. Companies from Japan (Hitachi, Uniplast), England (BOC Gas) and Taiwan (Kymco) are represented, as well as many other Asian and European companies. The Cikarang region continues to grow in importance as a location for foreign investments, with other prime industrial estates nearby, including the 3,000 hectare Jababeka Industrial Estate. Similarly, this estate is developing as a self contained city, with the Jababeka CBD complementing the industrial and residential developments within the estate. 4.5.2 Description MLC commenced operations in early 1995 as a relatively small one stop shopping complex serving the surrounding residential areas and workers in the nearby industrial estates. The centre currently comprises some 17,974 sq.m of NLA across two levels. Following the completion of the extension, total NLA will be 28,668 sq.m. Table 4.5.1 provides details of the centre. Figure 4.5.1 Mal Lippo Cikarang Source: PTLippo Karawaci Tbk

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Leased Malls Table 4.5.1 Centre details, Mal Lippo Cikarang

Characteristics

Address . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Year Opened . . . . . . . . . . . . . . . . . . . . . . . . . . . Last Refurb/Extension . . . . . . . . . . . . . . . . . . . . NLA (sq.m): . . . . . . . . . . . . . . . . . . . . . . . . . . . . Car Parking . . . . . . . . . . . . . . . . . . . . . . . . . . . . Motor Cycle Parking . . . . . . . . . . . . . . . . . . . . . . Levels . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Opening Hours . . . . . . . . . . . . . . . . . . . . . . . . . . Occupancy Rate. . . . . . . . . . . . . . . . . . . . . . . . . Major Retail Tenants: Majors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . .

Jl. M.H. Thamrin 1995 N.A. 17,974 (28,668 following extension) 513 950 2 10am - 9pm 96.3% (as at 30 June 2007) Hypermart (under construction), Matahari, Hero Supermarket Studio 21 Cinemas, Toko Buku Utama, Timezone Kentucky Fried Chicken, Pizza Hut, Wendys, Solaria, The Executive/Wrangler, Sports Station, Century Healthcare, Toys City 116 Weekdays: 10,600 Weekends: 17,000

Mini Majors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Selected Other . . . . . . . . . . . . . . . . . . . . . . . . . . .

Total Retail Tenancies. . . . . . . . . . . . . . . . . . . . . . Shopper Traffic . . . . . . . . . . . . . . . . . . . . . . . . . . .

Figure 4.5.2 Mal Lippo Cikarang: Images

Source: Jones Lang LaSalle Research and Consulting 4.5.3 Tenant mix The tenancy mix combines quality anchor tenants supported by a range of mini anchors and specialty retailers cater to provide for weekly shopping needs as well as comparison shopping. The completion of the Hypermart will increase the destination appeal of the centre and allow the Matahari Department Store to expand into the existing Matahari Supermarket space. Table 4.5.2 Tenancy mix by level, Mal Lippo Cikarang
Level Tenant mix (post hypermart extension)

Ground . . . . . . . . . . . . . . . . . . . . First . . . . . . . . . . . . . . . . . . . . . .

Hypermart, Matahari, Hero supermarket, F&B, Fashion, Accessories Matahari, Food Court, Cinemas, Timezone, Bookstore, Lifestyle & Entertainment, mixed fashion & beauty

Source: Jones Lang LaSalle Research and Consulting

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Leased Malls On the completion of the current extensions, the ground floor will be anchored by Matahari Department Store, Hypermart and Hero Supermarket. Consequently, the existing secondary malls should benefit from improved customer traffic accessing the Hypermart. Specialty retailers comprise food and beverage, fashion and accessories retailers. Key retailers include Kentucky Fried Chicken, Lee/Wrangler, Nokia and Wendys. This level also includes a considerable amount of casual mall leasing and kiosks, creating a market atmosphere within the central mall. Local retailers pitched at the middle income market dominate. Level One is anchored by the second level of Matahari and comprises the centres main entertainment precinct, including cinemas, Timezone and a food court. A book and stationery store (Toko Buku Utama) is located on this level. There is a broad mix of specialty retailers, including mixed fashion, salons and accessories. With the completion of the Hypermart, there will be a relatively large proportion of anchor and mini-anchor tenants to specialty retailers. The Hero supermarket, Hypermart and Matahari Department Store account for over 59% of total NLA while mini anchors (Cinema 21, Timezone, bookstore) account for a further 16.6%. This limits the number of specialty tenants within the centre but the strength of the anchor tenants has kept the occupancy rate high and within the range of 95% to 98% in recent years. Compared to other shopping centres within the portfolio, there are relatively few internationally branded retailers, a possible reflection of the customer profile. The centre does not include a fitness centre and has a limited lifestyle and entertainment offer. There are some homewares and home furnishings retailers. However, this offering should be improved considerably with the opening of Hypermart. Nevertheless, the retail mix is considered to provide an appropriate selection of convenience and comparison shopping for the residents of Cikarang. Table 4.5.3 Major tenants as at 30 June 2007, Mal Lippo Cikarang
Tenant Expiry date % Gross monthly rent

Matahari Dept Store . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Hero Supermarket . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Studio 21 Cinemas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Solaria . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Kentucky Fried Chicken . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Toko Buku Utama . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Sting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Wendys Restaurant . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Hoka-Hoka Bento . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Timezone . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Other tenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Total Centre . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

9-Feb-26 9-Aug-08 16-Feb-15 16-May-12 9-Jun-10 31-Aug-07 31-Jan-12 14-Mar-12 22-Aug-07 30-Sep-11 Varies

18.0% 11.8% 4.2% 4.1% 3.1% 3.1% 2.8% 2.4% 2.2% 1.9% 53.5% 100.0%

Source: Jones Lang LaSalle Research and Consulting, PT. Lippo Karawaci, Tbk Note: Hypermart under construction. Matahari Department Store to expand into supermarket space 4.5.4 Target market MLC primarily targets the middle income market, with the majority of its customer base coming from the Lippo Cikarang residential and industrial estates. During the week, the centre is also frequented by the large working population within the estate, which totals 65,000. On weekends, it is frequented mainly by families. 4.5.5 Trade area analysis To assist with the definition of trade areas and to understand the make-up of the customer base, a market research survey of visitors to the major leased malls was undertaken in February and March 2007. A total of seven (7) centres were included in the study. The surveying was conducted by TNS on behalf of Jones
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Leased Malls Lang LaSalle for the purposes of this assessment. The main findings of the market research in relation to the profile of shoppers at MLC are as follows: The mall attracts residents and employees of the Lippo Cikarang Estate, with Cikarang Selatan accounting for 55% of shoppers surveyed. Mall visitation is primarily driven by the centres location to either workplace or home; The majority of shoppers are regular customers to the mall, averaging three visits per month; MLC enjoys a virtual monopoly amongst its customer base with a very high 95% of survey respondents indicating this was the centre visited most often; Weekends are the most popular time to visit the mall, although MLC enjoys strong visitation from the local workforce during the week; Peak traffic hours occur around lunch time (12:00 to 14:00) and 16:00 to 19:00; The majority of shoppers arrive at the centre by either metromini or motorcycle; and Most shoppers are satisfied to very satisfied with MLC in terms of facilities, shops available and security. The trade area for MLC has been defined based on the findings of customer origin from the market research survey, the strength of the subject site, the location and relative strength of competing retail facilities and accessibility to the centre, including the road network, public transport and physical barriers. Based on these considerations, the centres PTA has been defined to cover a number of areas. According to the market research survey, the areas where the level of market penetration is highest for MLC are essentially sub-districts within Cikarang, including Cikarang Selatan, Cikarang Utara, Cikarang Pusat, Cikarang Timur and Cikarang Barat. The market penetration by MLC is also relatively strong in Serang Baru. The secondary catchment includes areas where MLC attracts visitors from, however the level of customer draw (market share penetration) is below the level achieved in the PTA. Areas considered to fall within the STA include Bekasi Timur, Karawang and Bekasi Utara. The trade area, including major competing centres within the trade area, is illustrated in the map below. As mentioned earlier, Cikarang Selatan, which includes the Lippo Cikarang Estate, provides the major source of customers. Figure 4.5.3: Mal Lippo Cikarang trade area
1. 2. 3. 4. 5. 6. Cikarang Trade Center Mal Carrefour Cikarang Sentra Grosir Cikarang Mega Bekasi Hypermall Bekasi Trade Centre Metropolitan Mall
6 4 5 3

Mall Lippo Cikarang

1

5 Km

Source: Jones Lang LaSalle Research and Consulting & Jakarta Street Atlas (Gunther W. Holtorf) As at 2007, the PTA shown on the above map included a population of 462,000 persons while the STA included a further 361,000 persons. Based on recent population trends in the area, the primary and secondary trade areas are forecast to grow by 1.1% per annum between 2007 and 2011, increasing to an indicative forecast population of 483,000 (PTA) and 378,000 (STA).
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Leased Malls The target market for MLC are middle-upper income households, which represent 71% of all households in the PTA and 64% of households in the STA. Trade area retail spending and forecast retail spending growth is summarised in Table 4.5.4 below. Together with modest population growth, total retail spending in the PTA and STA is expected to grow by 5.2% per annum between 2007 and 2011. Table 4.5.4 Mal Lippo Cikarang trade area: population growth and spending forecasts
% Growth 2007-2011 (p.a.)

2007 (f)

2011 (f)

Primary Trade Area . . . . . . . . .

Secondary Trade Area . . . . . .

Population Households* Retail Spending per Household (Rp. Million) Total Retail Spend (Rp. Billion) Population Households* Retail Spending per Household (Rp. Million) Total Retail Spend (Rp. Billion)

462,085 84,962 15.0 1,277 361,362 60,099 15.0 903

483,170 88,839 17.6 1,563 377,851 62,842 17.6 1,106

1.1% 1.1% 4.0% 5.2% 1.1% 1.1% 4.0% 5.2%

* Note: Total Households and Retail spending market only includes only those households assumed to fall within the target market (i.e., AC Nielsen Socio Economic Status (SES) categories A to C, described as middle and upper income households). Spend market at 2007 prices (i.e. 2011 spend market at 2007 prices; average annual retail spending per household and total retail spend market growth forecasts are real, not nominal, growth, excluding the effects of inflation) Source: AC Nielsen; Economic Intelligence Unit; Jones Lang LaSalle Research and Consulting 4.5.6 Competition MLC enjoys the benefit of a very captive market, being the only major shopping centre serving the Lippo Cikarang Estate. Therefore, it does not have major competitors for everyday shopping needs. It does, however, compete with a number of other shopping centres in the wider trade area for discretionary spending. The main competing centres to MLC are summarised in Table 4.5.5 and discussed below: Mal Metropolitan is located 20 kilometres north west of MLC in Bekasi. The centre comprises 74,000 sq.m of NLA and is anchored by Matahari and Ace Hardware. The centre is targeting middle income households and is considerably larger than MLC but its distance from MLC reduces the level of direct competition. Mal Carrefour Cikarang was completed in early 2007. The two-level centre is 4 kilometres from MLC and is likely to provide competition in the grocery and variety retailing market. It does not, however, provide such a complete range of retailing as is provided by MLC and is not as conveniently located to the captive target market of Lippo Cikarang Estate. Apart from Carrefour, there is a limited range of food and beverage retailers, specialty retailers and trade mall style retailing. SGC Cikarang is a strata titled mall approximately 9 kilometres to the north of MLC. The centre opened in 2006 and is anchored by Ramayana Hypermarket. Cikarang Trade Centre is located 2 kilometres north of MLC. The strata titled centre comprises approximately 10,000 sq.m of NLA, does not include an anchor tenant and targets the low-middle income market. Mega Bekasi Hypermall is a relatively large centre of 63,000 sq.m anchored by Giant Hypermarket. The centre is located 20 kilometres north west of MLC, which reduces the level of direct competition to the subject centre.
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Leased Malls Plaza JB (Jababeka) is located 5 kilometres northwest of MLC. The centre comprises 8,800 sq.m of NLA and is anchored by Pojok Busana. This primarily serves the growing residential and working population within the Jababeka Estate. Table 4.5.5 Main competition, Mal Lippo Cikarang
Centre name Dist. from MLC Type NLA (sq.m) Year open Anchor tenants

Mal Metropolitan . . . . . . . . . . Mal Carrefour Cikarang . . . . . SGC Cikarang . . . . . . . . . . . . Cikarang Trade Centre . . . . . . Mega Bekasi Hypermall . . . . . Plaza JB . . . . . . . . . . . . . . . .

20 4 9 2 20 5

km km km km km km

Lease Lease Strata Strata Strata Lease

74,000 8,000 29,150 10,000 63,000 8,800

1993 2007 2006 2005 2003 2003

Matahari, Ace Hardware Carrefour Ramayana Hypermarket N.A. Giant Pojok Busana

Source: Jones Lang LaSalle Research and Consulting 4.5.7 SWOT analysis Table 4.5.6 provides a summary of the strengths, weaknesses, opportunities and threats for MLC. Table 4.5.6 SWOT analysis, Mal Lippo Cikarang Source: Jones Lang LaSalle Research and Consulting
Strengths Weaknesses

Enjoys a strong trading position with limited competitive centres within its immediate trade area of Lippo Cikarang Very good access for both residents and workers of Lippo Cikarang via Jl. M.H. Thamrin Excellent exposure from main road Ample parking provided
Opportunities

Relatively small centre, currently 17,974 sq.m. This will increase with the completion of the Hypermart extension in 2007 Limited entertainment and lifestyle offerings

Threats

Opening of Hypermart will counter the recently opened Carrefour and provide a more complete retail offer at MLC. This also provides the opportunity for Matahari to extend its retail offering into the space vacated by Matahari Supermarket. Additional specialty retailers may be considered, given the relative imbalance between anchor tenant NLA and specialty NLA Survey results suggest a relatively high proportion of SES A and B customers. Opportunity to increase the proportion of retailers catering specifically to this market 4.5.8 Future outlook

New Carrefour Hypermarket, located approximately 4 kilometres from MLC Future competition such as Plaza JB and the Kota Deltamas retail centre may provide alternative destinations, particularly for discretionary spending

MLC has changed little since opening in 1995 but continues to successfully provide a one stop shopping convenience for its main target market of Lippo Cikarang Estate. Its size, however, has limited the range of retailing available to local residents.
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Leased Malls The current Hypermart extension provides a significant opportunity to improve the retail offering as well as the overall trading performance and income of the centre. Not only will Hypermart provide improved supermarket and variety shopping at MLC but it should strengthen the performance of specialty retailers by increasing the overall destination appeal of the centre. The extension also provides the opportunity for Matahari Department Store to extend its floor space into the existing Matahari Supermarket (which will close once Hypermart opens) and therefore increase its department store offering. While population growth is forecast to be quite modest over the short to medium term, the centres current expansion has the potential to increase market share and attract more customers to the centre, particularly from outside the Lippo Cikarang Estate. The expansion should also provide scope for income growth. There has been quite limited refurbishment of the centre since it opened 12 years ago. It is considered that the centre requires minor refurbishment and maintenance to ensure the captive customer base remains loyal in the face of future competition. Additional specialty retailers focusing on the middle-upper market is an area for consideration in the future. Relatively few retailers cater for the wealthier income brackets despite a relatively large middle to upper income customer base in the PTA. The factors above should all provide considerable upside to growth prospects for rental income over the short to medium term. It is considered that current specialty, F&B and restaurant rent levels are on the low side of market rentals, suggesting there is potential to increase rental levels upon lease renewal. This is further boosted by the addition of a new anchor tenant in Hypermart and an expanded Matahari Department Store. Considering these factors and the potential growth of retail spending in the trade area, average rents of MLC are projected to grow at approximately 12-15% per year across 2007-2009. Table 4.5.7: Rental positioning, Mal Lippo Cikarang
Tenancy category Average current rents (Rp./sqm/month) Estimated range of market rents (Rp./sqm/month)

Growth prospects

Anchor Tenants . . . . . . . . . . . Major Tenants . . . . . . . . . . . . Specialty Tenants . . . . . . . . . .

46,000 42,000 144,000

45,000 - 50,000 60,000 - 70,000 150,000 - 175,000

F&B, Restaurants . . . . . . . . . .

121,000

125,000 - 150,000

Potential growth on lease renewal Potential growth on lease renewal Potential growth on lease renewal. Upside due to new Hypermart and expanded Matahari Potential growth on lease renewal. Upside due to new Hypermart and expanded Matahari

Source: Jones Lang LaSalle Research and Consulting 4.6 Gajah Mada Plaza 4.6.1 Regional context and local economy Gajah Mada Plaza (GMP) is located at Jalan Gajah Mada 19-26, Jakarta, in the citys traditional Chinatown precinct. This area includes a mix of residential and commercial uses. The centre is also located just north of Gambir, where a number of the citys main civic buildings are located. Having been opened for 25 years, the centre is well established as one the first enclosed malls with an anchor tenant and a number of supporting specialty stores operating in Jakarta. The centre has firmed its position as a shopping destination able to meet the everyday retail requirements of local residents considered to be in the middle and middle-upper segments. Similarly, the centre also performs the broader
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Leased Malls function of being a major destination for comparison shopping in a number of specialist categories, in particular jewellery and pet shops. GMP effectively mixes traditional retail uses with lifestyle and entertainment facilities targeted primarily at the local Chinese market. As a result, a significant part of the centre remains open beyond the core retail trading hours.

4.6.2 Description Commencing operation in 1982, GMP is a well established shopping centre comprising 34,278 sq.m of NLA of retail space over seven levels and a basement. Table 4.6.1 provides details of the centre and Table 4.6.2 contains a listing of major tenancies at the subject site, including lease expiry date and the percentage contribution to gross monthly rent by the major tenant.

Figure 4.6.1 Gajah Mada Plazaexternal

Source: Gajah Mada Plaza Business Plan, PT. Lippo Karawaci, Tbk

Table 4.6.1 Centre details, Gajah Mada Plaza

Characteristics

Address . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Year Opened . . . . . . . . . . . . . . . . . . . . . . . . . . . Last Refurb / Extension . . . . . . . . . . . . . . . . . . . NLA (sq.m): . . . . . . . . . . . . . . . . . . . . . . . . . . . . Property Area (sq.m): . . . . . . . . . . . . . . . . . . . . . Car Parking . . . . . . . . . . . . . . . . . . . . . . . . . . . . Motor Cycle Parking . . . . . . . . . . . . . . . . . . . . . . Levels . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Opening Hours . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . .

Occupancy Rate. . . . . . . . . . . . . . . . . . . . . . . . . . Major Retail Tenants: Name . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Millenium Executive Club . . . . . . . . . . . . . . . . . . Hypermart . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Rimo Department Store . . . . . . . . . . . . . . . . . . . Gajah Mada Cinema 21 . . . . . . . . . . . . . . . . . . . Inul Viesta . . . . . . . . . . . . . . . . . . . . . . . . . . . . . McDonalds . . . . . . . . . . . . . . . . . . . . . . . . . . . . Total Retail Tenancies. . . . . . . . . . . . . . . . . . . . . Shopper Traffic . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Jl. Gajah Mada 19-26, Jakarta 1982 2005 34,278 37,501 885 665 7 (retail), 1 (basement) Weekdays: 10am - 10pm Weekends: 10am - 10pm 89.1% (as at 30 June 2007) % NLA 20.2% 14.5% 8.0% 4.9% 2.6% 1.8% 222 Weekdays: 23,000 Weekends: 35,000

Source: Jones Lang LaSalle Research and Consulting, PT. Lippo Karawaci, Tbk
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Leased Malls Figure 4.6.2 Gajah Mada Plaza: food court

Source: Jones Lang LaSalle Research and Consulting Table 4.6.2 Major tenants as at 30 June 2007, Gajah Mada Plaza
Tenant Expiry Date % Gross Monthly Rent

Millenium International . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Rimo Department Store . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Hypermart . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . McDonalds. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Inul Viesta . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Gajah Mada Cinema 21 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Other tenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Total Centre . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

29-Oct-2014 30-Jun-2008 2-Feb-2015 28-Jul-2013 31-Aug-2011 31-Mar-2013 Varies

8.6% 7.7% 7.3% 3.6% 2.5% 1.9% 68.4% 100.0%

Source: Jones Lang LaSalle Research and Consulting, PT. Lippo Karawaci, Tbk 4.6.3 Tenant mix GMP is somewhat unique in terms of its tenancy mix. The department store anchor is only located on one level (level three) and the Hypermart on the semi ground floor was opened following renovations in 2005. Pedestrian movements throughout the centre are supported by the specialty shop mix, which includes a number of zoned precincts where clusters of like-tenants are located. Table 4.6.3 summarises the tenancy mix by level at GMP . Table 4.6.3 Tenancy mix by level, Gajah Mada Plaza
Level Tenant mix

Semi Ground . . . . . . . . . . Ground . . First . . . . Second . . Third . . . . Third - A . Fifth . . . . Sixth . . . . Seventh . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Hypermart, casual mall leasing, mobile phone precinct (under development) Food and beverage, retail services, fashion, fashion accessories Jewellery, pet shops, fashion, retail services Entertainment and leisure, restaurants, jewellery Rimo department store, assorted specialties Food court, IT Restaurant/discotheque, cinemas Offices, to be sport and entertainment space Fitness centre, swimming pool, reception centre

Source: Jones Lang LaSalle Research and Consulting The semi ground floor is tenanted by Hypermart and a small amount of casual mall leasing. A large section of the semi ground level is currently vacant and is set to be converted to a mobile phone retailing precinct. The ground floor includes food and beverage operators, retail services, a small selection of fashion retailers, fashion accessories and optical stores. The first floor at GMP includes the pet shop precinct (pet centre), a number of jewellery retailers and a mix of fashion retailing, retail services and small electrical retailers.
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Leased Malls Level 2 is predominantly a lifestyle precinct, with a number of games centres, karaoke and restaurants. There are also a number of specialty stores, with jewellery dominating on this level. Level 3 is dominated by the Rimo department store. The store, which appears to be in need of additional floorspace, is currently trading from its core tenancy of 2,745 sq.m and a number of specialty shop spaces around its entrance (increasing its selling area by around 200 sq.m). While food and beverage is available throughout the centre, the main food court is located on level 3A. The food court includes around 20 small, hawker style tenancies with communal seating. Level 3A also contains a considerable number of IT-related shops and other small electronics retailers (e.g. cameras). Level 5 contains Millenium Executive Club, which operates during the day as a restaurant and late at night as a discotheque. Gajah Mada Cinema 21 is also located on this level. The seventh level comprises a small fitness centre and an outdoor swimming pool and the upper level of level seven is the location of Grand Gajah Mada and the Eva Bun reception centre regularly used for weddings and other large private events. 4.6.4 Target market GMP primarily targets the growing number of consumers within its trade area that fall within the middle and middle to upper income segments. GMP also has a Chinese-skew in its target market, with the centre being located in Chinatown and a number of retailers in the centre directly targeting this lucrative ethnic group. The centre also targets a broader market for comparison shopping purposes as a result of the centres destinational appeal within the product categories in which it is strong, namely jewellery and pet shops, and to a lesser extent IT and small electronics (including mobile phones following the opening of the new precinct in the lower ground floor). 4.6.5 Trade area analysis To assist with the definition of trade areas, a market research survey of visitors to the major leased malls was undertaken in February and March 2007. A total of seven (7) centres were included in the study. The surveying was conducted by TNS on behalf of Jones Lang LaSalle for the purposes of this assessment. The main findings of the market research in relation to the profile of shoppers at GMP are as follows: Visitors to GMP are relatively young (86% of those surveyed are younger than 35 years of age); The survey found that Saturday and Sunday were the most popular days to visit GMP , in line with other centres within the portfolio; Shopper traffic is particularly high in the early and late afternoon (between 12:00 and 14:00 and again between 16:00 and 19:00); One third of all visitors surveyed came directly from home to visit GMP . A significant proportion came from work (11%) and school (12%). Upon leaving the centre, home was the next destination for the majority of respondents (i.e. 84%); GMP has a high frequency of visitation, with 6% of visitors claiming to visit the mall everyday. A further 44% visit more than once a week; Visitors to GMP generally stay for relatively short periods. The centre has the lowest proportion of visitors who stay for an average of two hours or more (i.e. 48% of respondents) of all centres in the portfolio where visitors were surveyed. Just one in five frequent visitors to the mall stay for an average of more than three hours during each visit; Most respondents to the survey indicated that they mostly visit the mall with friends (68%; this is a multiple response question). 23% of respondents regularly visit the centre alone; Reflecting the centres status as a destination for comparison shopping in certain product categories (e.g. jewellery, pet shops, IT), the most commonly cited reason for visiting GMP is comparison shopping (i.e. 70%; this is a multiple response question). Eating was the second most common reason for visiting the mall. The strength of the lifestyle offer is reflected in statistics which show that a significant proportion (i.e. 38%) of respondents said meeting friends was one of the reasons for visiting the subject site;
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Leased Malls Of all the malls included in the market research study, GMP has the third highest level of overall customer satisfaction. Visitors surveyed were generally very satisfied with facilities, the tenancy mix and the level of security at the centre. The trade area for GMP has been defined based on the findings of customer origin from the market research survey, the strength of the subject site, the location and relative strength of competing retail facilities and accessibility to the centre, including the road network, public transport and physical barriers. Based on these considerations, the centres PTA has been defined to cover a number of areas. According to the market research survey, the areas where the level of market penetration is highest for GMP are areas in Jakarta including Gambir, Taman Sari and Tambora. Other areas included within the primary catchment are Kebayoran, Sawah Besar, Senen and Tanah Abang. The secondary catchment includes areas where GMP attracts visitors from, however the level of customer draw (market share penetration) is below the level achieved in the PTA. Areas considered to fall within the STA include Cengkareng, Palmerah, Kebayoran Baru and Kebon Jeruk. Taking the survey and the other factors outlined above into account, the trade area, including major competing centres within the trade area, is illustrated in the map below. Figure 4.6.3 Gajah Mada Plaza trade area
1. Mega Glodok Kemayoran, 2. Glodok Plaza 3. Istana Pasar Baru 4. Plaza Indonesia 5. ITC Mangga Dua 6. Plaza Atrium 7. Ciputra Mall 8. Roxy Square 9. Mega Mall Pluit 10. Mal Mangga Dua 11. Lindeteves Trade Centre 12. Taman Anggrek Mall 13. Wisma Maspion 14. ITC Harco Mas Mangga Dua 15. WTC Mangga Dua 16. Plaza Indonesia EX 17. Mangga Dua Square 18. JaCC Hyperstore 19. Plaza Semanggi 20. Plaza Senayan 21. Senayan City PROPOSED 22. Gajah Mada Square 23. Grand Indonesia 24. Seasons City 16. Plaza Indonesia Extension 25. Galeria Glodok 26. Emporium (CBD Pluit) 27. Pluit Junction

9 27 26

5
25 24 22 2 11

15 13 10 14 17

Gajah mada Plaza

1

6 12

16 4 1823

19 21 20

5km

Source: Jones Lang LaSalle Research and Consulting & Jakarta Street Atlas (Gunther W. Holtorf) As at 2003, the PTA is estimated to have included a population of 1.91 million (within around 474,000 households) while the STA included 1.17 million persons (with approximately 312,000 households). Recent population trends in the immediate surrounding area include the growing number of apartments typically domiciled by middle to upper income residents being offset by other residents vacating the trade area in search of more affordable housing and a result of the dislocation of some residents following new property developments. As a result, the net outcome is that the PTA population is estimated to have declined by 1.0% per annum between 2003 and 2007, decreasing to an indicative population of 1.83 million. Conversely, the STA is estimated to have exhibited modest population growth of 0.4% per annum, with population increasing to approximately 1.19 million in 2007. However, population declines are forecast for the STA moving forward.
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Leased Malls Importantly for GMP , 92% of all households in the PTA fall within the targeted middle to upper income group (defined as including households which are classified as SES A, B and C), while a similar proportion of STA residents (91%) are also within this target demographic. As a result, the number of target market households in the PTA is estimated at 429,300 households in 2007. The corresponding figure for the STA is 297,600 households. The population is forecast to decrease over the next four years, however as a result of the composition of population changes and reducing household sizes, the number of target market households is expected to continue growing up to 2011. The PTA is forecast to contain around 456,500 target households in 2011, while the STA is forecast to contain 315,500 target households. Average expenditure by households within the subject sites target market is estimated at Rp. 21.3 million per annum in 2007. Over the next four years, average annual household retail expenditure is expected to reach Rp. 24.93 million by 2011. As a result, the annual total retail spending market in the PTA is forecast to increase from Rp. 9,144 billion in 2007 to Rp. 11.380 billion in 2011, which represents an average annual rise of 5.6%. The corresponding increase in the STA is a rise from Rp. 6,339 billion to Rp. 7,872 billion, which reflects an average annual growth of 5.6%. Table 4.6.4 details the current and forecast levels of population growth and retail spending by households that fall within the centres target market (i.e. middle and upper income households). Table 4.6.4 Gajah Mada Plaza trade area: population growth and spending forecasts Source: AC Nielsen; Economic Intelligence Unit; Jones Lang LaSalle Research and Consulting
% Growth 2007-2011 (p.a.)

2007 (f)

2011 (f)

Primary Trade Area . . . . . . . . . Population Households Retail Spending per Household (Rp. Million) Total Retail Spend (Rp. Billion) Secondary Trade Area . . . . . . . Population Households Retail Spending per Household (Rp. Million) Total Retail Spend (Rp. Billion)

1,826,353 429,298 21.30 9,144 1,190,502 297,587 21.30 6,338

1,767,411 456,523 24.93 11,380 1,167,889 315,823 24.93 7,872

(0.8)% 1.5% 4.0% 5.6% (0.8)% 1.5% 4.0% 5.6%

* Note: Total Households and Retail spending market only includes only those households assumed to fall within the target market (i.e., AC Nielsen Socio Economic Status (SES) categories A to C, described as middle and upper income households). Spend market at 2007 prices (i.e. 2011 spend market at 2007 prices; average annual retail spending per household and total retail spend market growth forecasts are real, not nominal, growth, excluding the effects of inflation) Source: AC Nielsen; Economic Intelligence Unit; Jones Lang LaSalle Research and Consulting 4.6.6 Competition GMP is the most visited mall amongst its customers, with 53% of respondents surveyed reporting the subject site as the centre they visit most often. Located in the affluent Chinatown precinct of Jakarta, GMP faces strong competition locally from 13 large malls located within a 6 kilometre radius of the centre. However, a large number of the nearby centres are positioned to cater for a higher or lower market segment than that being catered for at GMP . The local centres of competitive relevance (i.e. centres larger than 20,000 sq.m), including their distance from GMP , opening year, amount of retail floor space and major tenants, are detailed in Table 4.6.5. The largest centres are discussed below: Mal Taman Anggrek is situated 3 kilometres to the south west of the subject site. The centre contains nearly 100,000 sq.m of retail space, including Metro and Galleria department stores and a Hero
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Leased Malls hypermart. The centre also includes an ice skating rink. Mal Taman Anggrek is targeting a wider market than GMP . Megamall Pluit is located 6 kilometres northwest of GMP . The centre is anchored by Matahari and Carrefour and contains around 84,000 sq.m of retail space. While this centre is much larger than the subject site, and is located 6 kilometres away, it is considered to be of competitive relevance as it is positioned to cater for a similar target market as GMP . A major redevelopment of this mall is imminent as the centre responds to competitive threats from new retail developments in its immediate vicinity. Mangga Dua contains a number of retail facilities, predominantly strata malls, located 3 kilometres north of the subject site. The main malls include Mangga Dua Square (60,000 sq.m), WTC Mangga Dua (45,000 sq.m), ITC Mangga Dua (44,000 sq.m) and Mal Mangga Dua (35,000 sq.m). Based on the retail offering at these centres, the area is targeting lower to middle income segment households which is below the customer profile targeted by GMP . Mal Ciputra is situated 3 kilometres west of GMP . The mall is anchored by Batik Keris, Matahari and Hero. This centre is also considered to be of particular competitive relevance, given it is located just 3 kilometres away and as it is targeting a similar market to GMP , although without the Chinese target market skew. Mega Glodok Kemayoran is situated 3 kilometres east of GMP . Anchored by Indonesia Marine Centre and Home Ciento, the tenancy mix of the mall is dominated by automotive part retailers. Hence, it is of minimal competitive relevance to the subject site. Plaza Indonesia is one of the most exclusive malls in Jakarta, situated 3 kilometres south of GMP . The centre contains 42,000 sq.m of mainly high-end retailing, including a Debenhams department store. Plaza Indonesia is targeting a more exclusive market than GMP . Jakarta City Centre is located 3 kilometres south of the subject site. While the centre is relatively close, it is of minimal competitive relevance due to its lower target market position. It is a strata mall anchored by a Hypermart but no department store. The competitive environment of the trade area is expected to intensify over the next five years, with the planned development of a number of competing retail facilities. There are a number of retail projects targeting middle income households currently under construction in Jakarta, such as Gajah Mada Square (due to open in the third quarter of 2007), Mall of Indonesia (due to open in the first quarter of 2008, and Emporium (due to open in the second quarter of 2009) , which will add a combined 378,000 sq.m of retail floor space to the Jakarta retail market by the end of 2009. These new projects are expected to reduce the sales growth that could have been achieved at GMP . However, given ongoing improvements proposed to the subject site, combined with its established market position as a value centre catering for middle to middle upper income Chinese households, GMP is well placed to withstand the new competitive threats. Furthermore, given GMPs well defined target market, these centres are expected to have a relatively small impact on the performance of the subject site (compared with their impact on other centres in Jakarta).

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Leased Malls Table 4.6.5: Main competition, Gajah Mada Plaza

Centre name Distance from GMP Type NLA (sq.m) Year opened Anchor tenants

Mal Taman Anggrek . . . . . . . . . . Megamal Pluit . . . . . . . . . . . . . . . Mangga Dua Square . . . . . . . . . . Mal Ciputra . . . . . . . . . . . . . . . . . Mega Glodok Kemayoran . . . . . . WTC Mangga Dua. . . . . . . . . . . . ITC Mangga Dua . . . . . . . . . . . . . Plaza Indonesia. . . . . . . . . . . . . . JaCC (Jakarta City Centre) . . . . . Mal Mangga Dua. . . . . . . . . . . . . Plaza Atrium . . . . . . . . . . . . . . . . Lindeteves Trade Centre . . . . . . . Glodok Plaza. . . . . . . . . . . . . . . . Future Competition Gajah Mada Square . . . . . . . . . Pluit Junction. . . . . . . . . . . . . . . Seasons City . . . . . . . . . . . . . . Galeria Glodok . . . . . . . . . . . . . Emporium (CBD Pluit) . . . . . . . .

3 km 6 km 3 km 3 km 3 km 3 km 3 3 3 3 3 2 2 km km km km km km km

Lease Lease Strata Lease Strata Strata Strata Lease Strata Strata Lease Strata Lease

97,000 84,000 60,000 51,000 47,000 45,000 44,000 42,000 38,000 35,000 34,000 30,000 26,000

1996 1996 2005 1993 2005 2003 1992 1990 2006 1995 1992 2006 2001

Galleria, Hero, Metro, Cinema 21 Matahari, Carrefour 1st Computer Square Batik Keris, Hero, Matahari, Watson Indonesia Marine Center, Home Cientro Electronic World, Life Spa Fitness N/A Debenhams, Food Hall Hypermart Yogya Matahari, Cinema 21 Giant, Ace Hardware Golden Crown Entertainment NA Studio 21, Timezone Carrefour NA NA

. . . . .

1 5 3 2 5

km km km km km

Lease Lease Strata Lease Lease

35,000 23,000 40,000 19,800 63,000

2007 2007 2008 2009 2009

Source: Jones Lang LaSalle Research and Consulting

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Leased Malls 4.6.7 SWOT analysis Table 4.6.6 provides a summary of the strengths, weaknesses, opportunities and threats for GMP . Table 4.6.6: SWOT analysis, Gajah Mada Plaza
Strengths Weaknesses

GMP is a well established, prominently located centre located near Chinatown, an area with a large number of middle and middle upper segment residents, with an above average proportion of Chinese residents GMP effectively caters for its target market (i.e. middle and middle to upper income segment with Chinese skew) as a one stop destination for shopping and leisure needs The centre is unique as it offers value for money retailing without compromising its target markets requirements for quality and ambience The centre benefits from a number of non-retail uses which generate income outside of normal shopping hours
Opportunities

The Rimo department store is poorly presented and appears to be in need of more space The centre is relatively old, hence it faces greater challenges in terms of competing with recently constructed centres (e.g. building services, ambience, etc.) The centre is located in the 3 in 1 CBD area (enforced car pooling precinct) which could deter visitation by individuals travelling by private car during peak hours on weekday afternoons

Threats

Reconfigure level 3 in conjunction with a refurbishment and expansion of the Rimo department store Further cement zoning strategy by fine tuning tenant mix throughout the centre (jewellery is concentrated around levels 1 and 2, there are jewellers The mobile phone precinct proposed for the basement level should reduce vacancy in this area and add further credence to GMPs profile as a comparison shopping centre destination (e.g. pets, jewellery, IT) Expand customer profile by capturing a higher share of the growing middle class market Devise strategies to increase average visit duration and average spending levels There is an opportunity to further enhance the tenancy mix by branding and minor refurbishment works such as lighting finishes and main entrance which enhance the ambience

Future shopping centre development in GMPs trade area remains strong which will inevitably dilute the potential of some centres in the area to maintain current market share The centre should avoid moving to an higher market position in line with its existing and new competitors as it would risk alienating core customers and jeopardise a point of difference for the centre

Source: Jones Lang LaSalle Research and Consulting 4.6.8 Future outlook Despite the threat of new competitors, the centre has a well established position in the market which should remain intact. GMP also has a number of opportunities to counteract new competition and consolidate its position as a leading destination offering value for middle to middle-upper income residents (particularly Chinese residents) in its trade area.
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Leased Malls A number of planned and potential improvements to the centre will be beneficial. Further enhancements to certain precincts in the centre (such as the new mobile phone precinct on the basement level) will improve the ambience of the centre, helping it to compete with newer shopping centre developments. If undertaken in coordination with a broader reinforcement of the tenancy mix strategy, these enhancements should improve centre income by maximising pedestrian flows, reducing vacancy levels and increasing revenues. Figure 4.6.4 Gajah Mada Plazacentre atrium

Source: Jones Lang LaSalle Research and Consulting Reinforcing the centre zoning strategy by creating stronger destinations around the mall should also assist with improving average spending levels and length of visitation. Given that visitors to the centre, and residents of the trade area more broadly, have relatively high levels of disposable income, further opportunities exist to increase GMPs market share of total retail spending amongst its target market by increasing visitors time spent at the centre (and, ultimately, increasing their average spend at the centre). The Rimo department store is considered to have further potential. Currently trading from a number of specialty store as well as its own main tenancy, reconfiguring the specialty shop layout near the entrance to Rimo would have a number of benefits. Firstly, it could increase the area of the department store anchor and improve its presentation. In addition, converting some specialty shop space to department store space would trigger some further remix of tenants, which could result in some inappropriately located tenancies moving to a location which reflects the tenancy mix strategy to create a number of destination zones where comparison shopping opportunities are stronger, resulting in customers staying for longer periods. With current rent levels considered to be below market and positive improvements to the tenancy mix currently taking place, the rental growth prospects for GMP are sound. As highlighted earlier, there is also potential upside from increasing existing occupancy levels. Considering these factors and the potential growth of retail spending in the trade area, average rents of GMP are projected to grow at approximately 11-13% per year across 2007-2009.

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Leased Malls Table 4.6.7: Rental positioning, Gajah Mada Plaza

Ave. current rents (Rp./sqm/mo) Est. range of market rents (Rp./sqm/mo)

Tenancy category

Growth prospects

Anchor Tenants. . . . . . . Major Tenants . . . . . . . . Specialty Tenants . . . . .

33,000 44,000 159,000

40,000 - 45,000 50,000 - 55,000 160,000 - 170,000

F&B, Restaurants . . . . .

137,000

175,000 - 200,000

Potential growth on lease renewal Potential growth on lease renewal Potential growth on lease renewal. Ongoing tenancy re-mix may improve prospects. Ongoing tenancy re-mix may improve growth prospects.

Source: Jones Lang LaSalle Research and Consulting Further increases in the centres market share in its trade area are possible, in particular by attracting new visitors to the centre by improving its retail offerings and by increasing the average time spent by current visitors. However, any strategies should not compromise GMPs strongly established position as a value centre for middle and middle-upper residents. 4.7 Ekalokasari Plaza 4.7.1 Regional context and local economy The municipality of Bogor is located in West Java Province, the most populous province in Java. It is approximately 50 kilometres south of Jakarta and is connected to Jakarta via the Jagorawi toll road. It is on one of the main routes that connect Jakarta to Bandung. The population of Bogor municipality in 2002 was approximately 855,000 while the metropolitan area comprises nearly 3 million residents. The surrounding area is a prime agricultural area with tea, coffee, rice, and rubber being important crops. An agricultural research centre, as well as an agricultural university and other research institutes associated with rural industries, is located in the City of Bogor. The city is also famous for its extensive botanical gardens, which is a significant tourist attraction. Bogor is part of Greater Jakarta referred to as Jabotabek, or Jabodetabek, a name formed from taking the first two or three letters of each major municipality in the metropolitan area. The metropolitan area of greater Jakarta comprises Jakarta (a province on its own), Bogor, Depok and Bekasi (all in West Java Province) and Tangerang (in Banten Province). Its population in 2005 was estimated to be 22.3 million, making it the largest metropolitan area in Indonesia, and one of the ten largest metropolitan areas in the world. The greater Jakarta metropolitan area is the political and economic heart of Indonesia. Ekalokasari Plaza (EP) is located in the municipality of Bogor, south-east of the city centre. It is one of the major modern shopping malls serving the Bogor metropolitan area. 4.7.2 Description EP is a large modern shopping centre over six retail levels and three basements, which commenced operation in December 2003. The shopping centre is located approximately 2 kilometres south east of the Bogor City Centre on a major road, Jl. Siliwangi, approximately 1 kilometre west of the Jagorawi Tollroad. The centre is currently undergoing major refurbishment and extensions that will see the addition of two new floors (level 3 and Mezzanine) comprising a range of lifestyle and entertainment facilities. A convention centre is also being built above the mezzanine, however this facility will be under separate ownership and does not form part of this market report. Upon completion of the current upper level extensions, the centre will have a NLA of 25,600 sq.m. Table 4.7.1 provides details of the centre.
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Leased Malls Figure 4.7.1 Ekalokasari Plazamain external entrance

Source: Jones Lang LaSalle Table 4.7.1 Centre details, Ekalokasari Plaza
Characteristics

Address. . . . . . . . . . . . . . . . . . . . . Year Opened . . . . . . . . . . . . . . . . . Last Refurb/Extension . . . . . . . . . . NLA (sq.m):. . . . . . . . . . . . . . . . . . Site Area . . . . . . . . . . . . . . . . . . . . Car Parking . . . . . . . . . . . . . . . . . . Motor Cycle Parking . . . . . . . . . . . Levels . . . . . . . . . . . . . . . . . . . . . . Opening Hours . . . . . . . . . . . . . . . Occupancy Rate . . . . . . . . . . . . . .

. . . . . . . . . .

Jl. Siliwangi No. 123, Bogor 2003 Ongoing 20,587 (25,600 following extension) 10,500 390 382 6 (retail), 3 (basement) 10am - 10pm 87.3% (as at 30 June 2007) Matahari, Marketplace supermarket Fit by Beat, Studio 21 Cinemas, Gramedia, Karisma, Timezone KFC, Dunkin Donuts, Popeyes Fried Chicken, Giordano, The Executive, Disk Tarra 107 Weekdays: 12,000 - 14,000 Weekends: 18,000 - 20,000

Major Retail Tenants: Majors . . . . . . . . . . . . . . . . . . . . . . . Mini Majors . . . . . . . . . . . . . . . . . . . Selected Other. . . . . . . . . . . . . . . . . Total Retail Tenancies . . . . . . . . . . . Shopper Traffic . . . . . . . . . . . . . . . .

Source: Jones Lang LaSalle Research and Consulting, PT. Lippo Karawaci, Tbk Figure 4.7.2 Ekalokasari Plaza: interior

Source: Jones Lang LaSalle Research and Consulting

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Leased Malls 4.7.3 Tenant mix The current extension to EP has the potential to alter the tenancy mix substantially. This analysis focuses on the existing tenancy mix of levels from Lower Ground to Level Two and provides an overview of the proposed uses for the two new upper levels. EP is one of the larger modern shopping centres in the Bogor, providing a range of both convenience and comparison shopping. Since being acquired by its current owners in 2005, the centre has undergone a remix and re-positioning, culminating in the current extension program. This repositioning is aimed at capturing a larger share of the middle-upper income segment. The Lower Ground level houses Matahari Marketplace, an upmarket ranch style supermarket that targets the middle-upper income households. There is a food court on this level, although this will be relocated to Level Three. The balance of this level comprises car parks. The Ground level provides mixed fashion and accessories, food and beverage and childrens entertainment offerings. There is considerable scope for exhibition space/casual mall leasing. The common mall areas are very generous and centre management indicated there is scope to move forward existing lease lines. Upper Ground has a fashion focus. The level is anchored by the Matahari Department Store, which extends across three levels. Karisma Bookstore is also located on this level. Similarly, specialty retailers on level 1 are primarily fashion retailers. Level 2 has a small concentration of childrens fashion, which complements Mataharis children department. Household and electronics retailers are also featured on this level, as is Gramedia. The two new levels focus on lifestyle and entertainment. Level 3 will comprise a large food court with 25 kiosks, mid to large sized restaurants, cinemas, Timezone, a range of small specialty retailers and a casual leasing area. The mezzanine level will comprise a fitness centre and a billiards centre. Table 4.7.2 Tenancy mix by level, Ekalokasari Plaza Source: Jones Lang LaSalle Research and Consulting
Level* Former level name Tenant mix (post Additions)

Lower Ground. . . . . Ground . . . . . . . . . . Upper Ground . . . First . . . . . . . . . . . Second. . . . . . . . . Third. . . . . . . . . . . Mezzanine . . . . . . . . . . .

Basement 1 Ground First Second Third NA NA

Marketplace Supermarket, Electronics, Household goods Fashion, Jewellery, Accessories, Beauty, Restaurants, Kids entertainment Matahari, Fashion Focus, Karisma Bookstore Matahari, Fashion, Beauty Matahari, Gramedia, Kids fashion, homewares Food Court, Cinemas, Restaurants, Timezone, Electronic stores Fitness Centre, Billiards, Access to Convention Centre (separate ownership)

Source: Jones Lang LaSalle Research and Consulting Note: *) New level naming has been in used starting January 2007 It is considered that EP provides the most comprehensive retail mix in the Bogor, with strengths in fashion, two large bookstores and strong anchor tenants. Entertainment and lifestyle retailing will be strengthened upon completion of the upper two levels in 2007.
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Leased Malls Table 4.7.3 Major tenants as at 30 June 2007, Ekalokasari Plaza
Tenant Expiry Date % Gross monthly rent

Matahari Department Store & Market Place Supermarket . . . . . . . . . . . . . . Gramedia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Karisma . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Number 61 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Other tenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Total Centre . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

23-Mar-15 21-May-14 29-Feb-24 11-Dec-08 Varies

21.6% 5.4% 4.0% 3.6% 65.4% 100.0%

Source: Jones Lang LaSalle Research and Consulting, PT. Lippo Karawaci, Tbk Note: *Excludes current extensions at Level 3 & Mezzanine 4.7.4 Target market EP targets the middle to middle-upper income segment within Bogor, particularly East and South Bogor (Bogor Timur and Bogor Selatan). Its current market is quite young. Current visitation to the centre is predominantly from the middle income groups. The re-positioning of the centre, including extensions, aims to attract a greater proportion of the upper income group and is targeting both the youth and young family markets. 4.7.5 Trade area analysis To assist with the definition of trade areas, a market research survey of visitors to the major leased malls was undertaken in February and March 2007. A total of seven (7) centres were included in the study. The surveying was conducted by TNS on behalf of Jones Lang LaSalle for the purposes of this assessment. The main findings of the market research in relation to the profile of shoppers at EP are as follows: The majority of customers come from East and South Bogor, within close proximity to the centre; 72% of the survey respondents were aged below 25 years old, the highest proportion of youth across all centres surveyed; Relatively low average income reported by respondents (the lowest across the eight centres) but this is partly due to the high proportion of youth in the profile. EP taps into the local middle income (SES C) market, which accounted for 41% of all respondents; Of the eight centres surveyed, respondents ranked EP highest in terms of customer satisfaction (facilities, range of shops and overall customer satisfaction); Prime times to visit the mall were on weekends. The busiest times tended to be between 3pm and 6pm. Night time is less popular, but entertainment uses are being added to the centre, which may well increase night time visitation; Main activities undertaken by shoppers were sightseeing/comparison shopping followed by eating, shopping for clothes, meeting friends and visiting bookstores; and Customers surveyed chose to shop at EP for a range of reasons, including its comfortable atmosphere and complete mix of stores. Customers perceive the mall as a trendy, popular location to visit. EP is in a very good position to build on what is already regarded by its customers as a high quality centre with a strong tenancy mix. The lifestyle and entertainment uses being added to the centre has the potential to not only improve the overall shopping experience but increase market share within its trade area. The trade area of EP has been defined based on the findings from the market research survey, the strength of the subject site, the location and relative strength of competing retail facilities and accessibility to the centre, including the road network, public transport and physical barriers. Based on these considerations, the centres PTA has been defined to cover a number of areas. According to the market research survey, the areas where the level of market penetration is highest for EP are
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Leased Malls primarily the city of Bogor (Bogor Timur, Bogor Selatan, Bogor Barat, Bogor Utara, Bogor Tengah) and Tanah Sereal. The secondary catchment includes areas where EP attracts visitors from, however the level of customer draw (market share penetration) is below the level achieved in the PTA. Areas considered to fall within the STA include Pancoran Mas, Serang Baru and Gunung Putri. The trade area, including major competing centres within the trade area, is illustrated in the below map. Figure 4.7.3: Ekalokasari Plaza trade area
1. 2. 3. 4. 5. 6. 7. 8. Plaza Jambu Dua Plaza Bogor Merdeka Bogor Bogor Trade Mall Bellanova Country Mall Botani Square Pangrango Plaza Plaza Indah Bogor

8 1

Ekalokasari Plaza
3 4 7 6 2

5 Km

Source: Jones Lang LaSalle Research and Consulting & Jakarta Street Atlas (Gunther W. Holtorf) As at 2005, the PTA shown on the above map included a population of 808,000 persons while the STA included a further 334,000 persons. Based on recent population trends in the area, the primary and secondary trade areas are forecast to grow by 3.0% and 3.4% per annum respectively between 2007 and 2011, increasing to an indicative forecast population of 967,000 (PTA) and 408,000 (STA). The target market for EP are middle-upper income households, which represent 74% of all households in the PTA and 72% of households in the STA. Trade area retail spending and forecast retail spending growth is summarised in Table 4.7.4 below. Together with strong population growth, total retail spending in the PTA is expected to grow by 6.2% per annum between 2007 and 2011 while total retail spending is forecast to grow by 6.9% per annum. There is also potential for the proportion of middle-upper income households to increase significantly within the trade area as new residential estates within commuting distance of Jakarta are developed. This should increase EPs target market.

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Leased Malls Table 4.7.4 Ekalokasari Plaza trade area: population growth and spending forecasts
% Growth 2007-2011 (p.a.)

2007 (f)

2011 (f)

Primary Trade Area . . . . . . .

Population Households* Retail Spending per Household (Rp. Million) Total Retail Spend (Rp. Billion) Population Households* Retail Spending per Household (Rp. Million) Total Retail Spend (Rp. Billion)

857,518 144,451 15.0 2,172 356,950 60,319 15.0 907

966,786 157,165 17.6 2,765 407,508 67,446 17.6 1,187

3.0% 2.1% 4.0% 6.2% 3.4% 2.8% 4.0% 6.9%

Secondary Trade Area . . . . . . .

* Note: Total Households and Retail spending market only includes only those households assumed to fall within the target market (i.e., AC Nielsen Socio Economic Status (SES) categories A to C, described as middle and upper income households). Spend market at 2007 prices (i.e. 2011 spend market at 2007 prices; average annual retail spending per household and total retail spend market growth forecasts are real, not nominal, growth, excluding the effects of inflation) Source: AC Nielsen; Economic Intelligence Unit; Jones Lang LaSalle Research and Consulting 4.7.6 Competition EP is the most visited mall amongst its customers, with 66% of respondents surveyed reporting the subject site as the centre they visit most often. The main competing centres to EP are summarised in Table 4.7.5 and discussed below: Botani Square opened in late 2006 and is potentially the strongest competitor to EP . Located 2 kilometres north west of the subject centre, the two level mall of approximately 30,000 sq.m targets a similar market to EP (middle income) and is anchored by a Giant Hypermarket and small Rimo department store. A third level of retail is expected to be added to the centre in 2008. As the centre becomes established and achieves higher occupancy, its potential competitiveness to EP is likely to increase. Pangrango Plaza is a strata mall approximately 3 kilometres northwest of EP . The centre comprises a Sarinah department store, Toko Bookstore and a large number of strata units over 7 levels. Total NLA is 30,000 sq.m, although a large proportion of the upper floors are vacant. The centre targets the low-middle income segment. Bogor Trade Mall is located 3.5 kilometres west of EP and opened in 2006. It is anchored by Ramayana department store and targets a lower income segment than the subject site. Plaza Jambu Dua is located 7 kilometre north of EP and is a relatively small lease mall of 20,800 sq.m. It is anchored by Ramayana and targets the middle lower income segment. Plaza Bogor is a lease mall approximately 3 kilometres to the west of EP . The centre opened in 1993 and is anchored by Robinson and targets the middle income segment. Future competition will come from the proposed extension to Botani Square as mentioned above. Apart from this extension, there are no other known shopping mall developments within the Bogor region that would be considered a competitive threat to EP . Continued expansion, however, by major department store retailers, hypermarkets and supermarkets may see further supply in the medium term, particularly in this relatively fast growing area of Greater Jakarta.
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Leased Malls Table 4.7.5: Main competition, Ekalokasari Plaza

Centre name Distance from EP Type NLA (sq.m) Year opened Anchor tenants

Botani Square . . . . . . . . . . . . Pangrango Plaza . . . . . . . . . . Bogor Trade Mall . . . . . . . . . Plaza Jambu Dua . . . . . . . . Plaza Indah Bogor . . . . . . . . Plaza Bogor . . . . . . . . . . . . . Bellanova Country Mall . . . . . . . . .

2.5 km 3 km 3.5 7 8 3 7 km km km km km

Lease Strata Strata Lease Lease Lease Strata

30,000 30,000 45,000 20,800 18,000 27,500 21,000

2006 2005 2006 1997 1999 1993 2006

Giant, Rimo, Electronic City, Gramedia Sarinah, Hero, Gunung Agung Bookstore Ramayana Ramayana Yogya Robinson Hypermart

Source: Jones Lang LaSalle Research and Consulting 4.7.7 SWOT analysis Table 4.7.6 provides a summary of the strengths, weaknesses, opportunities and threats for EP . Table 4.7.6 SWOT analysis, Ekalokasari Plaza
Strengths Weaknesses

The supermarket (Matahari Marketplace) is unique and helps the centre serve its core middle to middle-upper income trade area The centre is considered the dominant shopping mall in Bogor, with the most complete range of convenience and comparison shopping The factory outlet retailers located nearby are considered to complement the retail offering Tenancy mix, particularly fashion retail, is considered to be strong and the best in Bogor
Opportunities

There are insufficient parking space on weekends and this may become a greater issue once centre renovations and extensions are completed An existing lack of food options is perceived by some customers as a weakness

Threats

A major refurbishment and expansion of the F&B, lifestyle, cinema and gym precinct should complete the retail offering and increase its customer base The level 3 and Mezzanine extension should pull shoppers up through the mall, thereby improving trade on level 2 The completion of the extensions prior to Botani Square becoming well established provides a first mover advantage over this new market entrant Repositioning provides opportunity to improve tenancy zoning and mix, although customers consider the tenancy mix to be already quite good Centre management has considered moving forward lease lines at ground floor, reducing excessive common mall areas and increasing NLA

Botani Square is a potential threat to EP , however it has yet to establish its market. Once the third level is completed (in 2008) it may provide greater competition Other future competition may target the growing middle to middle-upper market

Source: Jones Lang LaSalle Research and Consulting

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Leased Malls 4.7.8 Future outlook Since opening in December 2003, EP has become the leading modern shopping mall in Bogor. Its customer base is derived primarily from nearby residential areas and market research suggests its customers are very satisfied with the atmosphere and retail offering currently available. With the centre currently undergoing a major re-positioning that is aimed to greatly improve both these aspects, EP is well placed to build further on its strengths. With vacant space within the shopping centre, the owners have the potential to greatly increase rental income at the centre by leasing up such space. Over time, the proportion of SES A and B customers is forecast to show strong growth in the trade area, providing further opportunities for the centre to tap into this lucrative market by targetting retailers that appeal to the middle-upper income segment. The market research surveys indicated relatively low per visit spend and a large proportion of window shoppers at the centre. Increasing the average spend per customer will be aided by the introduction of the lifestyle and entertainment precinct, which should also increase the average length of stay at the centre. The entertainment offer should also improve night time customer numbers, ensuring greater utilisation of the shopping centre throughout the day and night. On the competition front, Botani Square, once established, may provide increased competition in the middle-upper income segment. The current re-positioning at EP , however, should safeguard against this competitive threat and strengthen the market position of EP as the leading retail centre in Bogor. Parking issues are likely to increase as the new levels become fully functional and establish a customer base. Centre management has indicated that this is a priority and are considering alternatives to increase parking spaces on the site, improve efficiency and provide overflow spaces on neighbouring sites. It is considered that rental levels for anchor tenants are at the low side of market rentals whilst other categories are at the market average. The re-positioning of the centre through the centre expansion and remix will potentially increase customer traffic and sales across the various tenancy categories. This will provide further rental income growth prospects. Considering these factors and the potential growth of retail spending in the trade area, average rents of EP are projected to grow at approximately 12-15% per year across 2007-2009. Table 4.7.7: Rental Positioning, Ekalokasari Plaza
Average current rents (Rp./sqm/month) Estimated range of market rents (Rp./sqm/month)

Tenancy category

Growth prospects

Anchor Tenants . . . . . . . . . Major Tenants . . . . . . . . . . Specialty Tenants . . . . . . .

28,000 49,000 157,000 136,000

35,000 - 40,000 50,000 - 60,000 150,000 - 175,000 125,000 - 150,000

F&B, Restaurants . . . . . . . Source: Jones Lang LaSalle Research and Consulting

Potential growth on lease renewal Potential growth on lease renewal Potential growth due to centre expansion and re-positioning Potential growth due to centre expansion and re-positioning

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Retail Spaces Malls 5. RETAIL SPACES MALLS 5.1 Java Supermall 5.1.1 Regional context and local economy Located 423 kilometres east of Jakarta, Semarang is the capital city of Central Java Province and the fifth largest city in terms of population in Indonesia. With its location along the northern coast of Java, Semarang is an important trading port for the region. According to Central Bureau of Statistics, Central Java Province comprised 31.2 million people in 2000, recording average annual growth of 1.0% between 1995 and 2000. The municipality of Semarang had a population of 1.3 million in 2000 and this is estimated to have increased by 1.5 million in 2007, or 2.6% per annum. Of particular note is that Semarang contains a sizeable middle to upper income segment from various ethnic backgrounds. Figure 5.1.1 Java supermall, external frontage

Source: Jones Lang LaSalle Research and Consulting 5.1.2 Description Commencing operations in 2000, Java Supermall comprises approximately 19,800 sq.m of NLA. The centre is located in the centre of Semarang. The subject strata units are currently occupied by Matahari Department Store and Matahari Supermarket. Table 5.1.1 contains some key facts regarding Java Supermall, including details of the subject strata units. Table 5.1.1 Centre details, Java Supermall Source: Jones Lang LaSalle Research and Consulting
Centre name Java Supermall

Year Completed . . . . . . . . . . . . NLA (sq.m.) . . . . . . . . . . . . . . . Car Park Spaces . . . . . . . . . . . Motor Cycle Spaces . . . . . . . . . Strata Unit Area (sq.m) . . . . . . Major Tenants in the Centre . .

. . . . . .

2000 19,800 700 2,000 11,082* Matahari Supermarket, Matahari Department Store, food court, entertainment (including karaoke, bowling)

Source: Jones Lang LaSalle Research and Consulting * Note: The total area is based on the Strata Title Ownership Certificates. Java Supermall differs from other retail spaces malls in the portfolio due to the fact that specialty traders in the mall operate under a lease, rather than a strata ownership structure. As a result the centre includes a number of high profile retailers, including The Body Shop, Pizza Hut and McDonalds. With its mix of mall tenants, high profile retailers and major anchors, Java Supermall caters for a wide market, from the middle-lower to the middle-upper income segment.
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Retail Spaces Malls Matahari Department Store Matahari Department Store at Java Supermall is a full-line department store, offering a good selection of products in the core cosmetics, apparel and homewares categories. Matahari at Java Supermall is one of four Matahari Department Stores in Semarang. The subject site is facing strong competition from other and department store operators at nearby centres such as Mal Ciputra (Robinsons) and local operators such as Sriratu. The subject store targets the middle to middle-upper income segment, while competing department stores in the region are primarily targeting the middle or low to middle income segments. Figure 5.1.2 Java supermall, Matahari department store

Source: Jones Lang LaSalle and Consulting Future revenue growth is expected to be supported by renovation to the store which are planned to be conducted in mid 2007. While there may be a short-term disruption to sales, it is expected that the renovation will bring the subject site up to the latest Matahari fitout standards and will cement the department store as the most professionally presented in Semarang. Matahari Supermarket The Matahari Supermarket is a single level supermarket. It is likely to face more intense competition as Carrefour is expected to enter the local market by late 2007. Figure 5.1.3 Java supermall, Matahari supermarket

Source: Jones Lang LaSalle Research and Consulting 5.1.3 Trade area analysis Based on discussions with the store managers of Matahari Department Store and Matahari Supermarket, the trade area for Java Supermall is considered to approximate the extent of the Semarang municipality. In terms of competition, Java Supermall competes with the major malls in Semarang, in particular Plaza Simpang Lima and Mal Ciputra (which are interconnected via a pedestrian bridge in the centre of town). Overall, Mal Ciputra is considered to be pitched to a slightly higher income segment than Java Supermall and Plaza Simpang Lima is considered to be targeting a lower income segment. However, as noted earlier, both centres anchor department stores are considered to be targeting a lower income segment than Matahari at Java Supermall.
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Retail Spaces Malls In addition, local hypermarket operators are also of competitive relevance. In particular, ADA Setiabudi, approximately 15 minutes, drive from the subject site, is understood to attract a strong proportion of Semarang residents for their large monthly non-perishable grocery shopping needs. Future competition will come from DP Mall, a leased mall, located along Jl. Pemuda, about 3 km northwest of Java Supermall. Total NLA will be 19,000 sq.m with Carrefour as the anchor tenant. It will be completed in September 2007. The location of Java Supermall within Semarang, together with the locations of major competing centres, is illustrated in the map below. Figure 5.1.4 Java Supermall trade area
Shopping Centra (red dot) 1. Mal Ciputra 2. Plaza Simpang Lima 3. Plaza Johar 4. Semarang Plaza 5. Plaza Candi 6. Maja Mall Department Store (blue dot) 1. Ada Dept Store 2. Sri Ratu Dept Store 3. Sri Ratu Dept Store 4. Ada Dept Store 5. Ada Dept Store
5 1 1 2 34 2

3 4

Java Supermall

Source: Jones Lang LaSalle Research and Consulting & Travel Map Surakarta (PIN Maps) Target market household growth in the PTA is forecast to be significant between 2007 and 2011, increasing at an average annual rate of 4.8% per annum. By 2011, total target households is forecast to increase to 385,200 households. Table 5.1.2 Java Supermall trade area: population growth
% Growth 2007-2011 (p.a.)

2007 (f)

2011 (f)

Primary Trade Area . . . . . . . . . . . . . . . .

Population* Households*

1,286,906 318,877

1,486,968 385,233

3.7% 4.8%

Source: AC Nielsen; Economic Intelligence Unit; Jones Lang LaSalle Research and Consulting * Note: Total Population and Households only includes those population and households assumed to fall within the target market (i.e., Socio Economic Status (SES) categories A-C, described as middle and upper income households). 5.2 Malang Town Square 5.2.1 Regional context and local economy Malang is the second largest city in East Java Province with a population of approximately 800,000 and a regency population of approximately 2.4 million. Due to its elevation, it has a comparatively cool climate. The city is located less than 100 kilometres from Surabaya, Indonesias second largest city, and the region is a popular tourist destination due to its natural attractions (eg. Mount Bromo, one of Javas largest volcanoes), cool climate and colonial history. Malang also has a large student population, being home to five universities (Brawijaya, State, Muhammadiyah, Widya Gama and Merdeka Universities).
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Retail Spaces Malls As at the 2000 National Census, East Java Province had a population of nearly 35 million people, the second largest population of all Indonesian provinces after West Java. Malang Town Square is the largest modern shopping centre in the greater metropolitan area, and is located at Jl. Veteran No. 2. The centre opened for trade in 2005 and has quickly established itself as a major shopping destination for residents of Malang and from nearby cities and towns. It has also reduced the need for middle and middle-upper income residents of Malang to travel to Surabaya for higher quality retail goods. Figure 5.2.1: Malang Town Square

Source: Jones Lang LaSalle 5.2.2 Description Commencing operation in 2005, Malang Town Square comprises some 24,740 sq.m of NLA. The centre is located approximately 3 kilometres northwest of the centre of Malang. The subject strata units are currently occupied by Hypermart, Matahari Department Store and Timezone. Other major stores represented at Malang Town Square include a bookstore (Gramedia) and cinemas. Table 5.2.1 Relevant information, Malang Town Square
Centre name Malang Town Square

Year Completed . . . . . . . . . . . . . . . . NLA (sq.m.) . . . . . . . . . . . . . . . . . . . Car Park Spaces . . . . . . . . . . . . . . . Motor Cycle Spaces. . . . . . . . . . . . . Strata Unit Area (sq.m.) . . . . . . . . . Major Tenants in the Centre . . . . .

. . . . . .

2005 24,740 544 720 11,065* Hypermart, Matahari Department Store, Gramedia, Timezone, Cinemas, Entertainment

Source: Jones Lang LaSalle Research and Consulting * Note: The total area is based on Kiosks Sale and Purchase Binding Agreements and may not be the same as reflected on the Strata Title Ownership Certificates that are currently being processed. There is a relatively high concentration of fashion retailers in Malang Town Square, particularly aimed at the youth segment. The centre targets the middle to middle-upper income segment, being located near prime residential areas of Malang. During the week, the centre is popular with the youth segment due to the proximity of nearby major educational establishments. On weekends, the centre attracts a large number of young families. Matahari Department Store The Matahari Department Store is one of two Matahari stores in Malang. It is relatively small at approximately 3,079 sq.m and is not considered a full-line department store, with its range limited to fashion, beauty and accessories.
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Retail Spaces Malls The store targets the middle to middle-upper income segment. Competing department stores are primarily targeting the middle-lower income segment and located in the Malang CBD. These stores include Ramayana, Sarinah, Mitra and Ratu. Hypermart Hypermart is the only hypermarket in Malang. As such, the store enjoys a very strong market position, illustrated by it being the third best performing Hypermart within Indonesia in terms of total revenue. 5.2.3 Trade area analysis Based on discussions with the store manager of Matahari and Hypermart, the trade area for Malang Town Square is considered to approximate the whole city of Malang. The centre is conveniently located along a major road (Jl. Veteran No. 2), providing the centre with good access to the surrounding population base, which includes prime residential districts and a large student population. The location of Malang Town Square within the context of the City of Malang, together with the locations of major competing centres, is illustrated in the map below. Figure 5.2.2: Malang Town Square trade area
Leased Malls 1. Plaza Araya 2. Plaza Dieng 3. Gajah Mada 4. Plaza Malang Future Project
Malang Town Square 1

5. Mal Olympic Garden Department Store 6. Mitra II 7. Mitra I

2 5 7 3 4

Source: Jones Lang LaSalle Research and Consulting & Malang City Map (KPS) It is noted that a major competing centre, Mal Olympic Garden, is currently under construction. The strata titled centre will be anchored by a Giant Hypermarket with potential for a department store, although this is not yet confirmed. It is located approximately 2 kilometres from Malang Town Square. Between 2007 and 2011, the population of the PTA is forecast to growth by an average annual rate of 2.2%. Future demand for high quality retail centres and retail stores is likely to be driven by income growth, population growth and changing patterns in customer shopping away from traditional markets towards modern shopping complexes. The number of target market households in the PTA is estimated at around 147,300 households in 2007. The PTA is forecast to contain approximately 160,700 target households in 2011.
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Retail Spaces Malls Table 5.2.2 Malang Town Square trade area: population growth
% Growth 2007-2011 (p.a.)

2007 (f)

2011 (f)

Primary Trade Area . . . . . . . . . . . . . . . . . . .

Population* Households*

441,880 147,293

482,218 160,739

2.2% 2.2%

Source: AC Nielsen; Economic Intelligence Unit; Jones Lang LaSalle Research and Consulting * Note: Total Population and Households only includes those population and households assumed to fall within the target market (i.e., Socio Economic Status (SES) categories A-C, described as middle and upper income households). 5.3 Grand Palladium Medan 5.3.1 Regional context and local economy Medan, the provincial capital of North Sumatra, is the largest city in Sumatra, and the fourth largest in the nation after Jakarta, Surabaya and Bandung. It is a cosmopolitan city with a population of over 2 million plus a regency population of an additional 1.8 millon (e.g Deli Serdang and Binjai). Medan is renowned as a growing commercial centre in the region mainly with agriculture and industry businesses. The city has developed from a tobacco plantation village in the 19th century to a major government and commercial centre at present. Based on the 2000 National Census and Central Statistics Bureau projections, North Sumatra Province had a population of nearly 12.5 million people in 2005, the most populous province outside of Java. The city has a mix of communities, predominantly consisting of Batak, Melayu, Chinese, Javanese, and Tamil. Grand Palladium Medan is the newest strata title shopping centre in Greater Medan, commencing operations in October 2005. The centre is located along Jl. Kapten Maulana Lubis within the CBD. It has easy access to the other city amenities and is situated approximately 2.5 kilometres north of Polonia International Airport. Figure 5.3.1: Grand Palladium Medan: external

Source: Jones Lang LaSalle 5.3.2 Description Grand Palladium Medan comprises about 29,272 sq.m of NLA. The centre is located in the centre of Medan, surrounded by office and government buildings. The subject strata units are currently occupied by Hypermart, Matahari Department Store and Timezone. Other major stores represented at Grand Palladium Medan include a cinema (Cineplex 21).
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Retail Spaces Malls Table 5.3.1: Centre details, Grand Palladium Medan
Centre name Grand Palladium Medan

Year Completed . . . . . . . . . . . . . . . . . . . . . . . . . . . . . NLA (sq.m) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Car Park Spaces . . . . . . . . . . . . . . . . . . . . . . . . . . . . Motor Cycle Spaces . . . . . . . . . . . . . . . . . . . . . . . . . . Strata Unit Area (sq.m.) . . . . . . . . . . . . . . . . . . . . . . Major Tenants in the Centre . . . . . . . . . . . . . . . . . .

. . . . . .

2005 29,272 1,200 700 13,417* Hypermart, Matahari, Cineplex 21, Timezone

Source: Jones Lang LaSalle Research and Consulting * Note: The total area is based on Kiosks Sale and Purchase Binding Agreements and may not be the same as reflected on the Strata Title Ownership Certificates that are currently being processed Strata title shop units in Grand Palladium Medan are dominated by non-branded fashion retailers targeting the middle income segments. Due to its location in the CBD area, visitors to the centre are mainly people who work in the office buildings in the surrounding area on weekdays and from people in the surrounding residential areas on weekends. The centre currently has some vacancies on the upper levels and this may improve over time as additional strata units are sold and the centre becomes more established. Matahari Department Store The Matahari Department Store in Grand Palladium Medan is the smallest of the four Matahari stores in Medan, the other stores being located at Thamrin Plaza, Medan Fair and Medan Mall. Matahari occupies 5,020 sq.m. It is not considered a full-line department store, with its range limited to fashion, beauty and accessories. The store targets the middle to middle-upper income segment. Hypermart The Hypermart is one of only three hypermarkets in Medan with other hypermarkets being the Hypermart in Sun Plaza and Carrefour in Medan Fair. Currently, the store with the Hypermart at Sun Plaza dominates the Medan hypermarket segment and compete directly with other hypermarkets within the city. Future competition will arrive in July 2007, with the opening of another Hypermart in the Binjai area. 5.3.3 Trade area analysis Based on discussions with the store manager of Matahari and Hypermart, the PTA for Grand Palladium Medan covers the central areas of Medan. The centres strategic location along a major road (Jl. Kapten Maulana Lubis) creates high exposure to passing traffic from Jalan Gatot Subroto and good access to the surrounding population base, which includes prime residential districts.

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Retail Spaces Malls The trade area of Grand Palladium Medan is illustrated in the map below. Figure 5.3.2: Grand Palladium Medan trade area

Grand Paladium

Source: Jones Lang LaSalle Research and Consulting & Medan Street Map (ADL) In 2007, the estimated target households of the PTA is approximately 247,500 households with growth of around 1.3% per annum expected over the next four years. Table 5.3.2 Grand Palladium Medan trade area: population growth
% Growth 2007-2011 (p.a.)

2007 (f)

2011 (f)

Primary Trade Area . . . . . . . . . . . . . . . .

Population* Households*

1,075,843 247,537

1,135,062 261,162

1.3% 1.3%

Source: AC Nielsen; Economic Intelligence Unit; Jones Lang LaSalle Research and Consulting * Note: Total Population and Households only includes those population and households assumed to fall within the target market (i.e., Socio Economic Status (SES) categories A-C, described as middle and upper income households). The major competing centre is Medan Fair which is located approximately 1 kilometre west of Grand Palladium Medan. This centre commenced operations in 2004 with 53,500 sq.m of NLA across four levels and is anchored by Matahari and Carrefour. The other competing centres are Thamrin Plaza and Medan Mall, situated 1.5 kilometres and 2.3 kilometres to the east respectively. Both centres have an NLA of approximately 20,000 sq.m. Future competition will come from Deli Grand City, a redevelopment of Deli Plaza, located at Jalan Soekarno-Hatta, about 600 metres north of the Grand Palladium Medan. This centre is a leased mall within a mixed used complex comprising apartments, a hotel and a convention centre. The tenancy is a combination of short and long term lease. It will be completed in 2010 with 35,000 sq.m of NLA.

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Retail Spaces Malls Figure 5.3.3: Grand Palladium Medan competition map

2 5

Grand Palladium

3 1

Source: Jones Lang LaSalle Research and Consulting & Medan Map (KPS) 5.4 Metropolis Town Square 5.4.1 Regional context and local economy Metropolis Town Square is located in Tangerang, Banten Province, approximately 20 kilometres west of the Jakarta CBD. The centres strategic location near the main road connecting the toll road to Tangerang city provides easy access to the Jakarta-Merak toll gate and to surrounding residential areas in Tangerang. Tangerang is an industrial and manufacturing city in Greater Jakarta, being home to seven industrial estates occupying 1,700 hectares of land. Due to its proximity to Jakarta, Tangerang is a popular residential location for commuters who work in Jakarta. In recent years, residential estates and satellite cities such as Lippo Karawaci, Bumi Serpong Damai, Kota Modern, Alam Sutra, Summarecon Serpong and Bintaro Jaya have been developed in Tangerang. According to the Central Statistics Bureau, Tangerang has a city and regency population of approximately 1.5 million and 3.3 million respectively, totalling approximately 4.8 million in 2005. Between 2000 and 2005, the population of Tangerang grew by an average of 3.5% per annum. Metropolis Town Square is located along Jalan Hartono Raya within the Kota Modern residential estate, about 2.6 kilometres south of the city centre of Tangerang. The centre commenced operations in 2004 and has become the largest strata title shopping centre in Tangerang, catering for the needs of a growing number of middle income residents. Figure 5.4.1 Metropolis Town Square

Source: Jones Lang LaSalle Research and Consulting

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Retail Spaces Malls 5.4.2 Description Commencing operations in 2004, Metropolis Town Square comprises about 60,734 sq.m of NLA. The subject strata units are currently occupied by Hypermart, Matahari Department Store and Timezone. Other major stores represented in Metropolis Town Square include a bookstore (Utama Bookstore) and a cinema (Cineplex 21). Table 5.4.1 Relevant information, Metropolis Town Square
Centre name Metropolis Town Square

Year Completed. . . . . . . . . . . . . . . NLA ( sq.m). . . . . . . . . . . . . . . . . . Car Park Spaces . . . . . . . . . . . . . . Motor Cycle Spaces . . . . . . . . . . . Strata Unit Area (sq.m.) . . . . . . . . Major Tenants in the Centre . . . .

. . . . . .

2004 60,734 800 1,200 15,248* Hypermart, Matahari, Timezone, Utama Bookstore, Cineplex 21

Source: Jones Lang LaSalle Research and Consulting * Note: The total area is based on Kiosks Sale and Purchase Binding Agreements and may not be the same as reflected on the Strata Title Ownership Certificates that are currently being processed. Strata title shop units in Metropolis Town Square are dominated by non-branded fashion retailers, particularly targeted at youth segment. Electronics and telecommunication retailers are highly represented on the Second Floor. The centre targets the middle income segment, particularly young families from residential estates in Tangerang. In general, the centre has performed well in relation to the number of shop openings with the estimated occupancy rate at above 80%. As a strata title mall, it is reasonably well tenanted and well laid out in terms of zoning. Matahari Department Store The Matahari Department Store in Metropolis Town Square is one of three Matahari stores in Tangerang. The department store opened in 2004 but has since relinquished some space to allow Hypermart to expand. Despite its reduced size, the store accommodates most product lines including fashion, accessories, cosmetics and homewares. The store has performed well since opening and achieved good growth in revenues. The store targets the middle income segment, as does the Matahari store in Mall WTC Matahari, differing from Matahari store in Lippo Karawaci Supermal, which targets the middle-upper income segment. Most other department stores in Tangerang mainly target the middle to middle-lower income segment. These stores include Robinson in Plaza Tangerang, Diamond in DBest, Ramayana in ITC BSD and Pojok Busana in Plaza Serpong. Hypermart Hypermart is one of six hypermarkets in Tangerang. The other hypermarkets include Giant in Serpong Town Square and a stand-alone Giant hypermarket along Jalan Serpong Raya, Carrefour stores in DBest Plaza and ITC BSD, as well as other Hypermart stores in Mall WTC Matahari and Lippo Karawaci Supermal. The strongest competition to Hypermart comes from Carrefour in DBest Plaza, due to its proximity. 5.4.3 Trade area analysis Based on discussions with the store manager of Matahari and Hypermart, the PTA for Metropolis Town Square covers approximately the whole of Tangerang.
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Retail Spaces Malls This relatively high population growth together with changing patterns in customer shopping behavior away from traditional markets towards modern shopping centres is expected to continue to drive demand within modern shopping centres in Tangerang. The location of Metropolis Town Square within Tangerang, together with the locations of major competing centres, is illustrated in the map below. Figure 5.4.2: Metropolis Town Square trade area map
1. 2. 3. 4. 5. 6. 7. 8. 9. Supermal Karawaci DBest Plaza Plaza Tangerang Serpong Town Square Mal ITC Matahari Plaza BSD Plaza Serpong ITC BSD BSD Junction

Metropolis Town Square

2 4 1 7

5 6 8 9

Source: Jones Lang LaSalle Research and Consulting & Jakarta Street Atlas (Gunther W. Holtorf) The total population of the PTA in 2007 is approximately 1.6 million. This locality is a growing urban area with an average population growth of about 3.4% over the past five years, driven by strong growth in residential estate developments. It is expected that the population in the area will continue to increase at a similar level over the next five years. Between 2007 and 2011, target market household growth in the PTA is forecast to be significant, increasing at an average annual rate of 5.2% per annum. By 2011, total target households is forecast to increase to approximately 400,000 households. Table 5.4.2 Metropolis Town Square trade area: population growth
% Growth 2007-2011 (p.a.)

2007 (f)

2011 (f)

Primary Trade Area . . . . . . . . . . . . . . . . . . . . .

Population* Households*

1,186,507 327,446

1,358,702 401,153

3.4% 5.2%

Source: AC Nielsen; Economic Intelligence Unit; Jones Lang LaSalle Research and Consulting * Note: Total Population and Households only includes those population and households assumed to fall within the target market (i.e., Socio Economic Status (SES) categories A-C, described as middle and upper income households).
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Retail Spaces Malls 5.5 Depok Town Square 5.5.1 Regional context and local economy Depok is located in West Java Province, situated between South Jakarta and the northern side of Bogor. The city is located approximately 16 kilometres south of Jakarta CBD. Depok is renowned as a city of students, being home to four large universities (University of Indonesia, Gunadarma University, Tugu Polytechnic and Jakarta Polytechnic). Depoks population is estimated at 1.5 million in 2007 and has shown strong growth recently, averaging 3.3% per annum between 2000 to 2005. The growth is predominantly driven by demands for residential accommodation within close proximity to Jakarta, which is being served by new residential estate development in the region. In line with city population growth, the commercial area of Depok has been growing rapidly for the last few years, as evidenced by modern shopping centre developments (eg. ITC Depok, Margo City and Depok Town Square) and commercial buildings built along the main road of Depok, Jalan Margonda Raya. Depok Town Square is located along Jalan Margonda Raya, adjacent to the southeastern side of the University of Indonesia, the largest university in the country. The centre has a direct access to Pondok Cina Railway Station from its rear entrance, and therefore connect the Station to Jalan Margonda Raya. Developments in the surrounding area comprise mainly shopping centres, commercial buildings, shops and shophouses along Jalan Margonda Raya. Figure 5.5.1 Depok Town Square

Source: Jones Lang LaSalle Research and Consulting 5.5.2 Description Commencing operations in October 2005, Depok Town Square comprises about 41,129 sq.m of NLA. The subject strata units are currently occupied by Hypermart, Matahari Department Store and Timezone. Other major stores represented at Depok Town Square include a cinema (Cineplex 21). Table 5.5.1 Relevant information, Depok Town Square Source: Jones Lang LaSalle Research and Consulting
Centre name Depok Town Square

Year Completed . . . . . . . . . . . . . . . NLA ( sq.m) . . . . . . . . . . . . . . . . . . Car Park Spaces . . . . . . . . . . . . . . Motor Cycle Spaces. . . . . . . . . . . . Strata Unit Area (sq.m.) . . . . . . . . Major Tenants in the Centre . . . .

. . . . . .

2005 41,129 870 1,200 13,045 * Hypermart, Matahari Department Store, Timezone, Cineplex 21

Source: Jones Lang LaSalle Research and Consulting * Note: The total area is based on Kiosks Sales and Purchase Binding Agreements and may not be the same as reflected on the Strata Title Ownership Certificates that are currently being processed.
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Retail Spaces Malls Strata title shop units in the Depok Town Square are dominated by non-branded fashion retailers, particularly those targeting the youth segment. The centre targets the middle income segment, particularly young families from residents of middle income segment residential estates in Depok, and the student community around Depok. At present, the centre has an occupancy rate of around 70% based on all tenant types. The vacancies are mainly on the upper floors. Matahari Department Store The Matahari Department Store in Depok Town Square is the larger of two Matahari stores in Depok, at 6,989 sq.m. The store includes primarily fashion, accessories and cosmetics departments with a small section on homewares. Both Matahari stores in Depok target the relatively large middle income segment. Other department stores in Depok include Centro in Margo City, which targets the middle-upper income segment, and Ramayana Department Store in Plaza Depok, which targets the middle-lower income segment. Hypermart Hypermart is one of three hypermarkets competing in the grocery and variety trade in Depok, the other two being Giant at Margo City and Carrefour in ITC Depok. The store targets the middle to middle-lower income segment. 5.5.3 Trade area analysis Based on discussions with the store manager of Matahari and Hypermart, the PTA for Depok Town Square covers approximately the whole of Depok. In 2007, the estimated residential population of the PTA is approximately 1.2 million. Recent population growth has averaged 3.3% per annum. It is expected that similar population growth will be achieved over the next five years. The location of Depok Town Square, together with the locations of major competing centres, are illustrated in the map below. Figure 5.5.2: Depok Town Square trade area map
1. 2. 3. 4. 5. Margo City ITC Depok Mal Depok Plaza Depok Cibubur Junction

5 1 3 2 4

Source: Jones Lang LaSalle Research and Consulting & Jakarta Street Atlas (Gunther W. Holtorf)
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Retail Spaces Malls The number of target market households in the PTA is estimated at around 195,800 households in 2007. The PTA is forecast to contain approximately 222,400 target households in 2011. Table 5.5.2 Depok Town Square trade area: population growth Source: AC Nielsen; Economic Intelligence Unit; Jones Lang LaSalle Research and Consulting
% Growth 2007-2011 (p.a.)

2007 (f)

2011 (f)

Primary Trade Area . . . . . . . . . . . . . . . . . . . . . . . .

Population* Households*

846,907 195,784

961,196 222,383

3.2% 3.2%

Source: AC Nielsen; Economic Intelligence Unit; Jones Lang LaSalle Research and Consulting * Note: Total Population and Households only includes those population and households assumed to fall within the target market (i.e., Socio Economic Status (SES) categories A-C, described as middle and upper income households). The closest competing centre is Margo City, a leased mall, located directly opposite Depok Town Square. The centre comprises 50,000 sq.m of NLA and is anchored by Centro Department Store and Giant Hypermarket. It commenced operations in March 2006 and is targeting the middle to middle-upper income segment. ITC Depok is a similar strata title concept mall and also competes with Depok Town Square. It has 31,000 sq.m of NLA across five levels with Carrefour Hypermarket as its anchor tenant. It is located further south, next to Depok Bus Terminal and Depok Baru Railway Station. The other two competing malls are leased malls developed in the 1990s. Mal Depok is anchored by Matahari and Plaza Depok is anchored by Ramayana Department Store. Whilst there is considerable competition within close proximity of Depok Town Square, demand is increasing within the trade area. Demand for modern shopping centres in Depok is being driven by a combination of strong population growth, a growth of the middle income segment and the increased preference for modern one stop shopping malls. 5.6 Plaza Madiun 5.6.1 Regional context and local economy Madiun is a second-administrative level city in East Java Province. It is located around 169 km west of Surabaya (the capital city of East Java Province) and 114 km east of Solo. Madiun is the capital city of a regency of the same name. Madiun is the largest city in the western part of East Java Province with total land area of around 33.23 sq.km and the population of around 197,000 (2005 census). The regency has a total land area of 1,011 sq.km and a population of more than 641,000 (2001 census). Madiun is home to Indonesias first and largest train manufacturer, PT. Inka, which produces modern trains and locomotives for both domestic and overseas markets. Other than train manufacturing, Madiun is also know, as a major sugar producer in Java. There are two prominent sugar companies based in the city, PT. PG Rejoagung and PT. Kanigoro. The industrial sector had contributed significantly to Madiuns economy as reflected in its GRDP . In 2004, the industrial sector generated around 27% of Madiuns GRDP . Furthermore, Madiun is also known as one of the major airforce bases in Indonesia. The Iswahyudi Airfield Base is located in the eastern part of the city. 5.6.2 Description Plaza Madiun is located along Pahlawan Street, the primary thoroughfare in the city of Madiun. The street is positioned in the centre of the commercial and administrative zone. Most of the prominent buildings in
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Retail Spaces Malls Madiun are located in this precinct, including City Hall, Merdeka Hotel (the best hotel in town), Tentara Hospital and Pasaraya Shopping Centre. Pahlawan Street is accessible from Sudirman Street, another major thoroughfare in the the city that connects Solo and Surabaya. Plaza Madiun enjoys high exposure from Pahlawan Street and is well served by public transport. Figure 5.6.1 Location of Plaza Madiun

Source: Jones Lang LaSalle Research & Consulting & http://kotamadiun.go.id Plaza Madiun is one of the few established major shopping centres in the city, providing a relatively comprehensive range of retailing and one-stop shopping convenience to residents. Plaza Madiun was built in 2000 and commenced operations fully in June 2001 with the opening of Matahari Department Store. The centre has a total NLA of 19,029 sq.m. The subject property is currently occupied by Matahari Department Store and Matahari Supermarket. Figure 5.6.2: External view of Plaza Madiun

Source: Jones Lang LaSalle Research and Consulting The centre is anchored by Matahari Department Store and Matahari Supermarket. Matahari in Plaza Madiun is the only nationwide retailer (in the department store and supermarket format) present in the market. The brand has provided Plaza Madiun with a good image as a prominent shopping destination in the region. In addition, there are also some mini anchors complementing the centre, including Timezone and G-Fun (entertainment). The combination of the department store, supermarket and childrens entertainment has bolstered the positioning of Plaza Madiun as a one-stop family shopping centre.
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Retail Spaces Malls Table 5.6.1 Centre details, Plaza Madiun Source: Jones Lang LaSalle Research and Consulting
Plaza Madiun

Year Completed . . . . . . . . . . . . NLA (sq m) . . . . . . . . . . . . . . . . Major Tenants in the Centre . .

2000 19,029* Matahari Supermarket, Matahari Department Store, Timezone, Boston Pharmacy

Source: Jones Lang LaSalle Research and Consulting * Note: Total are is based on building measurement. The primary target market for Plaza Madiun is local city residents. Based on observation and information from the Matahari store manager, the majority of visitors coming to the centre are primarily from the middle to upper income segment compring mainly local residents and employees who are familiar with the Matahari brand and its products. While the brand is relatively new to Madiun compared to other local department stores or supermarket operators, it continues to show positive growth as seen in the increase in Mataharis market share over the past three years. Furthermore, customers from a wider market segment are becoming familiar with the brand as the result of effective marketing and promotion. The majority of shoppers coming to Plaza Madiun are families followed by the youth segment. Matahari Department Store This is the only Matahari Department Store in Madiun. It provides numerous lines ranging from fashion, accessories and some other necessities i.e stationery, tools and childrens toys. According to the Matahari store manager, product offerings from the outlet in Madiun are lower quality and prices. Being the only nationwide player in the market, Matahari has positioned itself slightly higher than other local department stores. The closest competition comes from the department store located across the road from Plaza Madiun, Pasaraya Sri Ratu, which other products similar to Mataharis. Others include smaller local players such as Bandung Department Store and President Department Store. Matahari Supermarket Matahari Supermarket caters to Madiuns middle-upper income segment. A good selection of fresh products coupled with quality professional services has put Matahari Supermarket far above its competitors in the local market. Again, the nearest competition comes from Pasaraya Sri Ratu, which combines a department store and supermarket in its outlet. Other competition comes from minimarkets such as Alfa and Superindo, which have expanded within local neighbourhoods. 5.6.3 Trade area analysis The centres trade area is considered to cover the whole of Madiun as the primary catchment and several cities within the Madiun Regency as the secondary catchment. The extensive greographic reach is due to there being few comparable modern retail facilities available within the region. In the PTA, Plaza Madiun shares the market with few shopping centres. However, based on interviews with Matahari management, the most significant competition is considered to be Pasaraya Sri Ratu. This centre has more retail space and variety of retailers compared to Plaza Madiun but Plaza Madiun is considered to have stronger anchor tenants. The two centres dominate the middle and middle-upper income segment in Madiun. Other competition for Plaza Madiun comes primarily from stand-alone department stores and supermarkets.
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Retail Spaces Malls Figure 5.6.3 Plaza Madiun trade area

Source: Jones Lang LaSalle Research and Consulting & http://kotamadiun.go.id Overall, it is estimated that the total population of Madiun city currently is approximately 200,000 and this is expected to grow moderately over the next five years. In 2007, the estimated target households of the PTA is approximately 29,400 households. The PTA is forecast to contain around 30,200 target households in 2011. Table 5.6.2 Plaza Madiun trade area: population growth
% Growth 2007-2011 (p.a.)

2007 (f)

2011 (f)

Primary Trade Area . . . . . . . . . . . . . . . . . . . . .

Population* Households*

105,758 29,377

108,848 30,236

0.7% 0.7%

Source: AC Nielsen; Economic Intelligence Unit; Jones Lang LaSalle Research and Consulting * Note: Total Population and Households only includes those population and households assumed to fall within the target market (i.e., Socio Economic Status (SES) categories A-C, described as middle and upper income households).

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Retail Spaces Malls 5.7 Mall WTC Matahari 5.7.1 Regional context and local economy Mall WTC Matahari is located along Jalan Serpong Raya, Serpong within Tangerang Regency, Banten Province. It is situated approximately 18 kilometres west of the Jakarta CBD. Mall WTC Matahari is strategically located on the main road, connecting the toll road to the Bumi Serpong Damai City (BSD City) residential estate, the largest residential estate in Greater Jakarta. It has a proposed development area of 6,000 hectares with currently 1,500 hectares of area developed and occupied by over 15,000 households. In recent years, BSD City has experienced rapid growth development in terms of the number of houses and shophouses that have been built. The estate has also successfully enhanced its target market segment from middle to middle-upper and upper income segment. This has improved the quality of development and facilities in the estate. The centre opened for trade in 2003, being the first strata title shopping centre in Tangerang. It has established itself as a major modern shopping destination particularly for middle income residents in the region. Figure 5.7.1 Mall WTC Matahari

Source: Jones Lang LaSalle 5.7.2 Description Mall WTC Matahari comprises about 48,204 sq.m of NLA. The subject strata units are currently occupied by Hypermart, Matahari Department Store and Timezone. Other major stores represented at Mall WTC Matahari include a bookstore (Gramedia) and Cineplex 21. Table 5.7.1 Centre details, Mall WTC Matahari Source: Jones Lang LaSalle Research and Consulting
Centre name Mall WTC Matahari

Year Completed . . . . . . . . . . . . . . . . . . . . . NLA (sq.m) . . . . . . . . . . . . . . . . . . . . . . . . . Car Park Spaces. . . . . . . . . . . . . . . . . . . . . Motor Cycle Spaces . . . . . . . . . . . . . . . . . . Strata Unit Area . . . . . . . . . . . . . . . . . . . . Major Tenants in the Centre . . . . . . . . . . .

2003 48,204 1,101 500 11,184 sq.m* Hypermart, Matahari, Timezone, Gramedia, Cineplex 21

Source: Jones Lang LaSalle Research and Consulting * Note: The total area is based on the Strata Title Ownership Certificates. Strata title shop units in the Mall WTC Matahari are dominated by non-branded fashion retailers, particularly targeted at the youth segment. The centre targets the middle income segment, particularly young families from residential estates in Serpong.
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Retail Spaces Malls The centre has the benefit of being the first strata title centre built after 2000 in Serpong, with most of the shop units sold to individual owners. It has performed well with an estimated occupancy rate of about 90% based on all tenant types. The vacancies are mostly on the low visitor traffic areas on the upper floors. Matahari Department Store The Matahari Department Store in Mall WTC Matahari is one of three Matahari stores in Tangerang. It is relatively small in size at approximately 3,470 sq.m and is not considered a full-line department store. The store focuses on products in the apparel, beauty and accessories categories. The store targets the middle income segment in line with the target market of the centre in general. The target market is the same as the Matahari store in Metropolis Town Square, differing from the Matahari store in Lippo Karawsaci Supermal, as this is targeting the middle-upper income segment. The other department stores in the Serpong area target the middle to middle-lower income segment. These stores include Ramayana in ITC BSD and Pojok Busana in Plaza Serpong. Hypermart Opened in 2005, the Hypermart is one of six hypermarkets in Tangerang. The other hypermarkets include two Giant stores, one in Serpong Town Square and a stand alone Giant hypermarket along Jalan Serpong Raya, Carrefour stores in DBest Plaza and ITC BSD, as well as other Hypermarts in Metropolis Town Square and Supermal Karawaci. The stores primary competition is considered to be the Giant hypermarket at Jalan Raya Serpong (which is located about 400 metres south of the centre) and Carrefour in ITC BSD, about 2.5 kilometres further south. 5.7.3 Trade area analysis Based on discussions with the store manager of Matahari and Hypermart, the PTA for Mall WTC Matahari is considered to cover residential estates in the Serpong area which is located within Tangerang Regency. The trade area of Mall WTC Matahari is illustrated in the map below. Figure 5.7.2 Mall WTC Matahari trade area
1. 2. 3. 4. 5. 6. 7. 8. 9. ITC BSD BSD Junction Plaza BSD Plaza Serpong Supermal Karawaci Serpong Town Square Metropolis Town Square Giant (Stand Alone) Summarecon Mal Serpong
7

6 5 9 4

Mall WTC Matahari

8 3 1 2

Source: Jones Lang LaSalle Research and Consulting & Jakarta Street Atlas (Gunther W. Holtorf)
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Retail Spaces Malls In 2007, the total number of housholds of the PTA was estimated at approximately 152,400 households. This locality is a growing residential area with an average household growth forecast of around 5% over the next four years. Between 2007 and 2011, target market household growth in the PTA is forecast to be significant, increasing at an average annual rate of 5% per annum. By 2011, total target households is forecast to increase to 133,700 households. Table 5.7.2 Mall WTC Matahari trade area: population growth Source: AC Nielsen; Economic Intelligence Unit; Jones Lang LaSalle Research and Consulting
% Growth 2007-2011 (p.a.)

2007 (f)

2011 (f)

Primary Trade Area . . . . . . . . . . . . . . . . . . .

Population* Households*

397,694 109,754

452,699 133,658

3.3% 5.0%

Source: AC Nielsen; Economic Intelligence Unit; Jones Lang LaSalle Research and Consulting * Note: Total Population and Households only includes those population and households assumed to fall within the target market (i.e., Socio Economic Status (SES) categories A-C, described as middle and upper income households). The major competing strata title mall to Mall WTC Matahari is ITC BSD which has a similar target market and is within walking distance of Mall WTC Matahari. ITC BSD, together with adjacent BSD Junction, a newly completed lifestyle strata mall, is much larger in size, comprising over 80,000 sq.m of NLA. BSD Junction has adopted a more lifestyle centred concept, with the ground floors allocated for caf and restaurants (F&B outlets). Other competitors in the vicinity of Mall WTC Matahari are Serpong Plaza and BSD Plaza, both leased centres but without high profile anchor tenants. Lippo Karawaci Supermal, a prominent leased mall in Karawaci, Serpong Town Square and Metropolis Town Square are competing malls within the subject sites STA. The future competition for Mall WTC Matahari is Summarecon Mall Serpong, a leased mall, located within Summarecon Serpong Residential Estate, Serpong, approximately 4 km north west of the centre. The first phase will have 40,000 sq.m NLA. It will open in June 2007 and may have a department store and a supermarket or a hypermarket, which is yet to be confirmed. Future demand for high quality shopping centres is likely to be driven by high population growth and income growth as indicated by more middle-upper to upper income segment housing being built in the surrounding residential estates including Bumi Serpong Damai, Alam Sutra, Villa Melati Mas, Royal Serpong Village, Summarecon Serpong and Paramount Lake.

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Appendix G
TERMS, CONDITIONS AND PROCEDURES FOR APPLICATION FOR AND ACCEPTANCE OF THE UNITS IN SINGAPORE Applications are invited for the subscription of the Units at the Offering Price of S$0.80 per Unit on the terms and conditions set out below and in the relevant Application Forms or, as the case may be, the Electronic Applications (as defined below). Investors applying for the Units in the Public Offer or the Placement by way of Application Forms or Electronic Applications are required to pay the Offering Price of S$0.80, subject to a refund of the full amount or, as the case may be, the balance of the application monies (in each case without interest or any share of revenue or other benefit arising therefrom) where (i) an application is rejected or accepted in part only, or (ii) the Offering does not proceed for any reason. (1) (2) Your application must be made in lots of 1,000 Units or integral multiples thereof. Your application for any other number of Units will be rejected. You may apply for the Units only during the period commencing at 9.00 a.m. on 12 November 2007 and expiring at 12 noon on 15 November 2007. The Offering period may be extended or shortened to such date and/or time as the Manager may agree with the Joint Lead Managers, Issue Managers and Underwriters, subject to all applicable laws and regulations and the rules of the SGX-ST. (a) Your application for the Units offered in the Public Offer (the Offer Units) may be made by way of the printed WHITE Offer Units Application Forms or by way of Automated Teller Machines (ATMs) of the Participating Banks (Electronic Applications). Your application for the Units offered in the Placement (the Placement Units) may be made by way of the printed BLUE Placement Units Application Forms (or in such other manner as the Joint Lead Managers, Issue Managers and Underwriters may in their absolute discretion deem appropriate).

(3)

(b)

(4)

You may use up to 35.0% of your CPF Investible Savings (CPF Funds) to apply for the Units. Approval has been obtained from the Central Provident Fund Board (the CPF Board) for the use of such CPF Funds pursuant to the Central Provident Fund (Investment Schemes) Regulations, as may be amended from time to time, for the purchase of the Units. You may also use up to 35.0% of your CPF Funds for the purchase of the Units in the secondary market. If you are using CPF Funds to apply for the Units, you must have a CPF Investment Account maintained with the relevant CPF approved bank (which includes the Participating Banks). You do not need to instruct the CPF Board to transfer CPF Funds from your CPF Ordinary Account to your CPF Investment Account. The use of CPF Funds to apply for the Units is further subject to the terms and conditions set out in the section on Terms and Conditions for Use of CPF Funds on page G-15 of this Prospectus.

(5)

(6)

Only one application may be made for the benefit of one person for the Offer Units in his own name. Multiple applications for the Offer Units will be rejected, except in the case of applications by approved nominee companies where each application is made on behalf of a different beneficiary. You may not submit multiple applications for the Offer Units via the Offer Units Application Form or Electronic Applications. A person who submits an application for the Offer Units by way of the Offer Units Application Form may not submit another application for the Offer Units by way of an Electronic Application and vice versa. A person, other than an approved nominee company, who submits an application for the Offer Units in his own name should not submit any other applications for the Offer Units, whether on a Application Form or through an Electronic Application, for any other person. Such separate applications will be deemed to be multiple applications and shall be rejected. Joint or multiple applications for the Offer Units shall be rejected. Persons submitting or procuring submissions of multiple applications for the Offer Units may be deemed to have
G-1

Appendix G committed an offence under the Penal Code, Chapter 224 of Singapore and the Securities and Futures Act, and such applications may be referred to the relevant authorities for investigation. (7) Applications from any person under the age of 21 years, undischarged bankrupts, sole proprietorships, partnerships, chops or non-corporate bodies, or joint Securities Account holders of CDP will be rejected. Applications from any person whose addresses (furnished in their Application Forms or in the case of Electronic Applications, contained in the records of the Participating Banks, as the case may be) bear post office box numbers will be rejected. No person acting or purporting to act on behalf of a deceased person is allowed to apply under the Securities Account with CDP in the deceaseds name at the time of application. The existence of a trust will not be recognised. Any application by a trustee or trustees must be made in his/her or their own name(s) and without qualification or, where the application is made by way of a Application Form by a nominee, in the name(s) of an approved nominee company or approved nominee companies after complying with paragraph 10 below.

(8)

(9)

(10) Nominee applications may only be made by approved nominee companies. Approved nominee companies are defined as banks, merchant banks, finance companies, insurance companies, licensed securities dealers in Singapore and nominee companies controlled by them. Applications made by nominees other than approved nominee companies will be rejected. (11) If you are not an approved nominee company, you must maintain a Securities Account with CDP in your own name at the time of your application. If you do not have an existing Securities Account with the CDP in your own name at the time of application, your application will be rejected (if you apply by way of an Application Form) or you will not be able to complete your application (if you apply by way of an Electronic Application). (12) Subject to paragraph 18 below, your application is liable to be rejected if your particulars such as name, National Registration Identity Card (NRIC) or passport number, nationality and permanent residence status, and/or CDP Securities Account number provided in your Application Form, or in the records of the Participating Banks at the time of your Electronic Application, as the case may be, differ from those particulars in your Securities Account as maintained by CDP . If you have more than one individual direct Securities Account with the CDP , your application shall be rejected. (13) If your address as stated in the Application Form or, in the case of an Electronic Application, contained in the records of the relevant Participating Bank is different from the address registered with CDP, you must promptly inform CDP of your updated address, failing which the notification letter on successful allocation from CDP will be sent to your address last registered with CDP. (14) This Prospectus and its accompanying Application Forms have not been registered in any jurisdiction other than in Singapore. The distribution of this Prospectus and its Application Forms may be prohibited or restricted (either absolutely or unless various securities requirements, whether legal or administrative, are complied with) in certain jurisdictions under the relevant securities laws of those jurisdictions. Without limiting the generality of the foregoing, neither this Prospectus (including its Application Forms) nor any copy thereof may be taken, transmitted, published or distributed, directly or indirectly, in whole or in part, in or into the U.S. and they do not constitute an offer of securities for sale into the U.S. or any jurisdiction in which such offer is not authorised or to any person to whom it is unlawful to make such an offer. The Units have not been and will not be registered under the United States Securities Act of 1933, as amended (the Securities Act) and, accordingly may not be offered or sold within the U.S., except in certain transactions exempt from the registration requirements of the Securities Act. The Units are being offered and sold in offshore transactions (as defined in Regulation S under the Securities Act (Regulation S)) in reliance on Regulation S. Any failure to comply with this restriction may constitute a violation of U.S. securities laws.
G-2

Appendix G (15) The Manager reserves the right to reject any applications for Units where the Manager believes or has reason to believe that such applications may violate the securities laws of any jurisdiction. (16) No person in any jurisdiction outside Singapore receiving this Prospectus or its accompanying Application Forms may treat the same as an offer or invitation to subscribe for any Units unless such an offer or invitation could lawfully be made without compliance with any regulatory or legal requirements in those jurisdictions. (17) The Manager reserves the right to reject any application which does not conform strictly to the instructions set out in this Prospectus (including the instructions set out in the Application Forms or in the ATMs of the Participating Banks) or, in the case of an application by way of an Application Form, which is illegible, incomplete, incorrectly completed or which is accompanied by an improperly drawn up or improper form of remittance. (18) The Manager further reserves the right to treat as valid any applications not completed or submitted or effected in all respects in accordance with the instructions set out in this Prospectus (including the instructions set out in the Application Forms and in the ATMs of the Participating Banks), and also to present for payment or other processes all remittances at any time after receipt and to have full access to all information relating to, or deriving from, such remittances or the processing thereof. (19) Without prejudice to the rights of the Manager, the Joint Lead Managers, Issue Managers and Underwriters, as agents of the Manager, have been authorised to accept, for and on behalf of the Manager, such other forms of application as the Joint Lead Managers, Issue Managers and Underwriters may, in consultation with the Manager, deem appropriate. (20) The Manager reserves the right to reject or to accept, in whole or in part, or to scale down or to ballot, any application, without assigning any reason therefor, and none of the Trustee, the Manager and the Joint Lead Managers, Issue Managers and Underwriters will entertain any enquiry and/or correspondence on the decision of the Manager. This right applies to applications made by way of Application Forms and by way of Electronic Applications and by such other forms of application as the Joint Lead Managers, Issue Managers and Underwriters may, in consultation with the Manager, deem appropriate. In deciding the basis of allocation, the Manager will give due consideration to the desirability of allocating the Units to a reasonable number of applicants with a view to establishing an adequate market for the Units. (21) The Units may be reallocated between the Placement and the Public Offer at the discretion of the Joint Lead Managers, Issue Managers and Underwriters, in the event of an excess of applications in one and a deficit of applications in the other. (22) It is expected that CDP will send to you, at your own risk, within 15 Market Days after the close of the Offering, and subject to the submission of valid applications and payment for the Units and the Offering Price being agreed upon between the Joint Lead Managers, Issue Managers and Underwriters and the Manager, a statement of account stating that your Securities Account has been credited with the number of Units allocated to you. This will be the only acknowledgement of application monies received and is not an acknowledgement by the Manager. You irrevocably authorise CDP to complete and sign on your behalf as transferee or renouncee any instrument of transfer and/or other documents required for the issue or transfer of the Units allocated to you. This authorisation applies to applications made both by way of Application Forms and by way of Electronic Applications. (23) You irrevocably authorise CDP to disclose the outcome of your application, including the number of Units allocated to you pursuant to your application, to the Manager, the Joint Lead Managers, Issue Managers and Underwriters and any other parties so authorised by Manager and/or the Joint Lead Managers, Issue Managers and Underwriters. (24) Any reference to you or the Applicant in this section shall include a person, a corporation, an approved nominee company and trustee applying for the Units by way of an Application Form or by way of an Electronic Application.
G-3

Appendix G (25) By completing and delivering an Application Form and, in the case of an Electronic Application, by pressing the Enter or OK or Confirm or Yes key or any other relevant key on the ATM, you: (a) irrevocably agree and undertake to purchase the number of Units specified in your application (or such smaller number for which the application is accepted) at the Offering Price for each Unit and agree that you will accept such number of Units as may be allocated to you, in each case on the terms of, and subject to the conditions set out in, this Prospectus and its accompanying Application Forms and the Trust Deed; agree that, in the event of any inconsistency between the terms and conditions for application set out in this Prospectus and its accompanying Application Forms or ATMs of the Participating Banks, the terms and conditions set out in this Prospectus and its accompanying Application Forms shall prevail; in the case of an application by way of an Offer Units Application Form or Electronic Application, agree that the aggregate Offering Price for the Units applied for is due and payable to the Manager upon application; in the case of an application by way of a Placement Units Application Form or such other forms of application as the Joint Lead Managers, Issue Managers and Underwriters may, in consultation with the Manager, deem appropriate, agree that the aggregate Offering Price for the Units applied for is due and payable to the Manager upon application; warrant the truth and accuracy of the information contained, and representations and declarations made, in your application, and acknowledge and agree that such information, representations and declarations will be relied on by the Manager in determining whether to accept your application and/or whether to allocate any Units to you; and agree and warrant that, if the laws of any jurisdictions outside Singapore are applicable to your application, you have complied with all such laws and none of the Manager nor any of the Joint Lead Managers, Issue Managers and Underwriters will infringe any such laws as a result of the acceptance of your application.

(b)

(c)

(d)

(e)

(f)

(26) Acceptance of applications will be conditional upon, inter alia, the Manager being satisfied that: (a) permission has been granted by the SGX-ST to deal in and for quotation of all of the Units on the Official List of the SGX-ST; and the Underwriting Agreement has become unconditional and has not been terminated.

(b)

(27) Additional terms and conditions for applications by way of Application Forms are set out in the section entitled Additional Terms and Conditions for Applications using Application Forms on pages G-5 to G-8 of this Prospectus. (28) Additional terms and conditions for applications by way of Electronic Applications are set out in the section entitled Additional Terms and Conditions for Electronic Applications on pages G-9 to G-14 of this Prospectus. (29) Terms and conditions governing the use of CPF funds are set out in the section entitled Terms and Conditions for Use of CPF Funds on page G-15 of this Prospectus. (30) No application will be held in reserve. (31) This Prospectus is dated 9 November 2007. No Units will be allocated on the basis of this Prospectus later than 12 months after the date of this Prospectus.
G-4

Appendix G Additional Terms and Conditions for Applications using Application Forms Applications by way of an Application Form shall be made on, and subject to the terms and conditions of this Prospectus, including but not limited to the terms and conditions set out below, as well as those set out under the section on Terms, Conditions and Procedures for Application for and Acceptance of the Units in Singapore on pages G-1 to G-15 of this Prospectus, and the Trust Deed. (1) Applications for the Offer Units must be made using the printed WHITE Offer Units Application Forms and printed WHITE official envelopes A and B, accompanying and forming part of this Prospectus. Applications for the Placement Units must be made using the printed BLUE Placement Units Application Forms, accompanying and forming part of this Prospectus. Without prejudice to the rights of the Manager, the Joint Lead Managers, Issue Managers and Underwriters, as agents of the Manager, have been authorised to accept, for and on behalf of the Manager, such other forms of application, as the Joint Lead Managers, Issue Managers and Underwriters may (in consultation with the Manager) deem appropriate. Your attention is drawn to the detailed instructions contained in the respective Application Forms and this Prospectus for the completion of the Application Forms, which must be carefully followed. The Manager reserves the right to reject applications which do not conform strictly to the instructions set out in the Application Forms and this Prospectus or which are illegible, incomplete, incorrectly completed or which are accompanied by improperly drawn up or improper form of remittances. (2) (3) You must complete your Application Forms in English. Please type or write clearly in ink using BLOCK LETTERS. You must complete all spaces in your Application Forms except those under the heading FOR OFFICIAL USE ONLY and you must write the words NOT APPLICABLE or N.A. in any space that is not applicable. Individuals, corporations, approved nominee companies and trustees must give their names in full. If you are an individual, you must make your application using your full name as it appears on your identity card (if you have such an identification document) or in your passport and, in the case of a corporation, in your full name as registered with a competent authority. If you are not an individual, you must complete the Application Form under the hand of an official who must state the name and capacity in which he signs the Application Form. If you are a corporation completing the Application Form, you are required to affix your Common Seal (if any) in accordance with your Memorandum and Articles of Association or equivalent constitutive documents of the corporation. If you are a corporate applicant and your application is successful, a copy of your Memorandum and Articles of Association or equivalent constitutive documents must be lodged with LMIR Trusts Unit Registrar and Unit Transfer Office. The Manager reserves the right to require you to produce documentary proof of identification for verification purposes. (a) (b) You must complete Sections A and B and sign page 1 of the Application Form. If you apply for the Units using cash only or cash and CPF Funds to pay for the Units, you are required to delete either paragraphs 6(c) or 6(d) on page 1 of the Application Form. Where paragraph 6(c) is deleted, you must also complete Section C of the Application Form with particulars of the beneficial owner(s). If you fail to make the required declaration in paragraph 6(c) or 6(d), as the case may be, on page 1 of the Application Form, your application is liable to be rejected.

(4)

(5)

(c) (6)

You (whether an individual or corporate applicant, whether incorporated or unincorporated and wherever incorporated or constituted) will be required to declare whether you are a citizen or permanent resident of Singapore or a corporation in which citizens or permanent residents of Singapore or any body corporate constituted under any statute of Singapore have an interest in the aggregate of more than 50.0% of the issued share capital of or interests in such corporation. If you are an approved nominee company, you are required to declare whether the beneficial owner of the
G-5

Appendix G Units is a citizen or permanent resident of Singapore or a corporation, whether incorporated or unincorporated and wherever incorporated or constituted, in which citizens or permanent residents of Singapore or any body corporate incorporated or constituted under any statute of Singapore have an interest in the aggregate of more than 50.0% of the issued share capital of or interests in such corporation. (7) You may apply and make payment for your application for the Units in Singapore currency in the following manner: (a) Cash onlyYou may apply for the Units using only cash. Each application must be accompanied by a remittance in Singapore currency for the full amount payable at the Offering Price of S$0.80 for each Offer Unit, or the Offering Price for each Placement Unit, as the case may be, in respect of the number of Units applied for. The remittance must be in the form of a BANKERS DRAFT or CASHIERS ORDER drawn on a bank in Singapore, made out in favour of LMIR TRUST UNIT ISSUE ACCOUNT crossed A/C PAYEE ONLY with the name, Securities Account number and address of the applicant written clearly on the reverse side. Applications not accompanied by any payment or accompanied by any other form of payment will not be accepted. No combined Bankers Draft or Cashiers Order for different Securities Accounts shall be accepted. Remittances bearing NOT TRANSFERABLE or NON-TRANSFERABLE crossings will be rejected.

(b) CPF Funds onlyYou may apply for the Units using only CPF Funds. Each application must be accompanied by a remittance in Singapore currency for the full amount payable at the Offering Price of S$0.80 for each Offer Unit, or the Offering Price for each Placement Unit, as the case may be, in respect of the number of Units applied for. The remittance must be in the form of a CPF CASHIERS ORDER (available for purchase at the CPF approved bank with which the applicant maintains his CPF Investment Account), made out in favour of LMIR TRUST UNIT ISSUE ACCOUNT with the name, Securities Account number and address of the applicant written clearly on the reverse side. Applications not accompanied by any payment or accompanied by any other form of payment will not be accepted. For additional terms and conditions governing the use of CPF Funds, please refer to page G15 of this Prospectus. (c) Cash and CPF FundsYou may apply for the Units using a combination of cash and CPF Funds, PROVIDED THAT the number of Units applied for under each payment method is in lots of 1,000 Units or integral multiples thereof. Such applications must comply with the requirements for applications by cash and by CPF Funds as set out in the preceding paragraphs. In the event that applications for Offer Units are accepted in part only, the cash portion of the application monies will be used in respect of such applications before the CPF Funds are used. In the case of applications for Placement Units that are accepted in part only, the CPF Funds portion of the application monies will be used in respect of such applications before the cash portion is used. An applicant applying for 1,000 Units must use either cash only or CPF Funds only. No acknowledgement of receipt will be issued for applications and application monies received. (8) Monies paid in respect of unsuccessful applications are expected to be returned (without interest or any share of revenue or other benefit arising therefrom) to you by ordinary post within 24 hours (or such shorter period as the SGX-ST may require) after the balloting at your own risk. Where your application is accepted in full or in part only, the balance of the application monies will be refunded (without interest or any share of revenue or other benefit arising therefrom) to you by ordinary post at your own risk within 14 Market Days after the close of the Offering, PROVIDED THAT the remittance accompanying such application which has been presented for payment or other processes has been honoured and the application monies received in the designated unit issue account. If the Offering does not proceed for any reason, the full amount of application monies (without interest or any share of revenue or other benefit arising therefrom) will be returned to you within three Market Days after the Offering is discontinued. Capitalised terms used in the Application Forms and defined in this Prospectus shall bear the meanings assigned to them in this Prospectus.

(9)

G-6

Appendix G (10) By completing and delivering an Application Form, you agree that: (a) in consideration of the Manager having distributed the Application Form to you and by completing and delivering the Application Form before the close of the Offering : (i) (ii) your application is irrevocable; your remittance will be honoured on first presentation and that any monies returnable may be held pending clearance of your payment without interest or any share of revenue or other benefit arising therefrom; and you represent and agree that you are not a U.S. person (within the meaning of Regulation S);

(iii) (b)

all applications, acceptances or contracts resulting therefrom under the Offering shall be governed by and construed in accordance with the laws of Singapore and that you irrevocably submit to the non-exclusive jurisdiction of the Singapore courts; in respect of the Units for which your application has been received and not rejected, acceptance of your application shall be constituted by written notification by or on behalf of the Manager and not otherwise, notwithstanding any remittance being presented for payment by or on behalf of the Manager; The Manager may return (without interest or any share of revenue or other benefit arising therefrom) to you by ordinary post, at your own risk: (i) (ii) (iii) where your application is unsuccessful, the monies paid within 24 hours (or such shorter period as the SGX-ST may require) after the close of the balloting; where your application is accepted in full or in part only, the balance of the application monies within 14 Market Days after the close of the Offering; and; where the Offering does not proceed for any reason, the monies paid within three Market Days after the Offering is discontinued,

(c)

(d)

PROVIDED THAT the remittance accompanying such application which has been presented for payment or other processes has been honoured and the application monies received in the designated unit issue account; (e) you will not be entitled to exercise any remedy of rescission for misrepresentation at any time after acceptance of your application; (f) reliance is placed solely on information contained in this Prospectus and that none of the Manager, the Trustee, the Joint Lead Managers, Issue Managers and Underwriters or any other person involved in the Offering shall have any liability for any information not contained therein;

(g) you consent to the disclosure of your name, NRIC/passport number, address, nationality, permanent resident status, Securities Account number, CPF Investment Account number and Unit application amount to our Unit Registrar, CDP , CPF, Securities Clearing Computer Services (Pte) Ltd (SCCS), SGX-ST, the Manager, the Trustee and the Joint Lead Managers, Issue Managers and Underwriters (the Relevant Parties); and (h) you irrevocably agree and undertake to purchase the number of Units applied for as stated in the Application Form or any smaller number of such Units that may be allocated to you in respect of your application. In the event that the Manager decides to allocate any smaller number of such Units or not to allocate any Units to you, you agree to accept such decision as final. Applications for the Offer Units by way of Application Forms (1) Your application for the Offer Units by way of Application Forms must be made using the WHITE Offer Units Application Forms and WHITE official envelopes A and B. ONLY ONE APPLICATION should be enclosed in each envelope.
G-7

Appendix G (2) You must: (a) enclose the WHITE Offer Units Application Form, duly completed and signed, together with correct remittance for the full amount payable at the Offering Price of S$0.80 per Unit in Singapore currency in accordance with the terms and conditions of the Prospectus and its accompanying documents, in the WHITE official envelope A provided; in appropriate spaces on the WHITE official envelope A: (i) (ii) (iii) (c) (d) write your name and address; state the number of Offer Units applied for; and affix adequate Singapore postage;

(b)

SEAL THE WHITE OFFICIAL ENVELOPE A; write, in the special box provided on the larger WHITE official envelope B addressed to OCBC BANK, 63 CHULIA STREET, OCBC CENTRE EAST #03-03, SINGAPORE 049514, the number of Offer Units you have applied for; insert the WHITE official envelope A into the WHITE official envelope B and seal the WHITE OFFICIAL ENVELOPE B and DESPATCH BY ORDINARY POST OR DELIVER BY HAND the documents at your own risk to OCBC BANK, 63 CHULIA STREET, OCBC CENTRE EAST #03-03, SINGAPORE 049514, so as to arrive by 12 noon on 15 November 2007 or such other date(s) and time(s) as the Manager may agree with the Joint Lead Managers, Issue Managers and Underwriters. Courier services or Registered Post must NOT be used.

(e)

(3) (4)

Applications that are illegible, incomplete or incorrectly completed or accompanied by improperly drawn remittances or which are not honoured upon their first presentation are liable to be rejected. No acknowledgement of receipt will be issued for any application or remittance received.

Applications for the Placement Units by way of Application Forms (1) Your application for the Placement Units by way of Application Forms must be made using the BLUE Placement Units Application Forms. ONLY ONE APPLICATION should be enclosed in each envelope. The completed and signed BLUE Placement Units Application Form and your remittance, in accordance with the terms and conditions of this Prospectus, for the full amount payable at the Offering Price of S$0.80 per Unit in respect of the number of Placement Units applied for, with your name, Securities Account number and address clearly written on the reverse side, must be enclosed and sealed in an envelope to be provided by you. Your application for Placement Units must be delivered to OCBC BANK, 63 CHULIA STREET, OCBC CENTRE EAST #03-03, SINGAPORE 049514, to arrive by 12 noon on 15 November 2007 or such other date(s) and time(s) as the Manager may agree with the Joint Lead Managers, Issue Managers and Underwriters. In respect of an application for Placement Units, you may alternatively remit your application monies by electronic transfer to the account of OCBC BANK, OCBC CENTRE BRANCH, Current Account number 517-206108-001 in favour of LMIR TRUST UNIT ISSUE ACCOUNT by 12 noon on 15 November 2007 or such other date(s) and time(s) as the Manager may agree with the Joint Lead Managers and Underwriters. Applicants who remit their application monies via electronic transfer should send a copy of the telegraphic transfer advice slip to OCBC BANK, 63 CHULIA STREET, OCBC CENTRE EAST #03-03, SINGAPORE 049514, to arrive by 12 noon on 15 November 2007 or such other date(s) and time(s) as the Manager may agree with the Joint Lead Managers, Issue Managers and Underwriters. Applications that are illegible, incomplete or incorrectly completed or accompanied by improperly drawn remittances or which are not honoured upon their first presentation are liable to be rejected. No acknowledgement of receipt will be issued for any application or remittance received.

(2)

(3)

(4) (5)
G-8

Appendix G Additional Terms and Conditions for Electronic Applications Electronic Applications shall be made on and subject to the terms and conditions of this Prospectus, including but not limited to the terms and conditions set out below and those under the section Terms, Conditions and Procedures for Application for and Acceptance of the Units in Singapore on pages G-1 to G-15 of this Prospectus, as well as the Trust Deed. (1) (2) The procedures for Electronic Applications are set out on the ATM screens of the Participating Banks. For illustration purposes, the steps for Electronic Applications through ATMs of OCBC Bank (the Steps) are set out in pages G-13 to G-14 of this Prospectus. The Steps set out the actions that you must take at the ATMs to complete an Electronic Application. Please read carefully the terms and conditions of this Prospectus, the Steps and the terms and conditions for Electronic Applications set out below before making an Electronic Application. (3) Any reference to you or the Applicant in these Additional Terms and Conditions for Electronic Applications and the Steps shall refer to you making an application for the Units through an ATM of a Participating Bank. If you are making an Electronic Application: (a) You must have an existing bank account with and be an ATM cardholder of one of the Participating Banks. An ATM card issued by one Participating Bank cannot be used to apply for Units at an ATM belonging to other Participating Banks. The Steps set out the action that you must take at ATMs of OCBC Bank to complete an Electronic Application. The actions that you must take at ATMs of other Participating Banks are set out on the ATM screens of the relevant Participating Banks. You must ensure that you enter your own Securities Account number when using the ATM card issued to you in your own name. If you fail to use your own ATM card or do not key in your own Securities Account number, your application will be rejected. If you operate a joint bank account with a Participating Bank, you must ensure that you enter your own Securities Account number when using the ATM card issued to you in your own name. Using your own Securities Account number with an ATM card which is not issued to you in your own name will render your Electronic Application liable to be rejected. Upon the completion of your Electronic Application, you will receive an ATM transaction slip (Transaction Record), confirming the details of your Electronic Application. The Transaction Record is for your retention and should not be submitted with any printed Application Form.

(4)

(b)

(c)

(5)

In connection with your Electronic Application of Offer Units, you are required to confirm statements to the following effect in the course of activating the Electronic Application: (a) that you have received a copy of this Prospectus and have read, understood and agreed to all of the terms and conditions of application for the Units and this Prospectus prior to effecting the Electronic Application and agree to be bound by the same; that you consent to the disclosure of your name, NRIC/passport number, address, nationality, permanent resident status, CDP Securities Account number, CPF Investment Account number (if applicable) and Unit application amount (the Relevant Particulars) from your account with the relevant Participating Bank to the Relevant Parties; and where you are applying for the Offer Units, that this is your only application for the Offer Units and it is made in your name and at your own risk. Your application will not be successfully completed and cannot be recorded as a completed transaction unless you press the Enter or OK or Confirm or Yes or any other relevant key in the ATM. By doing so, you shall be treated as signifying your confirmation of each of the three statements above. In respect of statement 5(b) above, your confirmation, by pressing the Enter or OK or Confirm or Yes or any other relevant key, shall signify and shall be treated as your written permission, given in accordance with the relevant laws of Singapore,
G-9

(b)

(c)

Appendix G including Section 47(2) of the Banking Act, Chapter 19 of Singapore, to the disclosure by the Participating Bank of the Relevant Particulars of your account(s) with the Participating Bank to the Relevant Parties. (6) By making an Electronic Application, you confirm that you are not applying for Offer Units as nominee of any other person and that any Electronic Application that you make is the only application made by you as beneficial owner. You shall make only one Electronic Application for the Offer Units and shall not make any other application for the Offer Units, whether at the ATMs of any Participating Bank or on the Application Forms. Where you have made an application for Offer Units or Placement Units on an Application Form, you shall not make an Electronic Application for Offer Units and vice versa. You must have sufficient funds in your bank account with the Participating Bank at the time you make your Electronic Application, failing which such Electronic Application will not be completed. Any Electronic Application which does not conform strictly to the instructions set out in this Prospectus or on the screens of the ATMs of the Participating Banks through which your Electronic Application is being made shall be rejected. You may apply and make payment for your application for the Offer Units in Singapore currency in the following manner: (a) Cash onlyYou may apply for the Offer Units through any ATM of the Participating Banks using only cash by authorising the Participating Bank to deduct the full amount payable from your bank account(s) with the Participating Bank. CPF Funds onlyYou may apply for the Offer Units through any ATM of the Participating Banks using only CPF Funds by authorising the Participating Bank to deduct the full amount payable from your CPF Investment Account with the Participating Bank. For additional terms and conditions governing the use of CPF Funds, please refer to page G-15 of this Prospectus. Cash and CPF FundsYou may apply for the Offer Units through any ATM of the Participating Banks using a combination of cash and CPF Funds, PROVIDED THAT the number of Offer Units applied for under each payment method is in lots of 1,000 Units or integral multiples thereof. Such applications must comply with the requirements for applications by cash and by CPF Funds as set out in the preceding paragraphs. In the event that such applications are accepted in part only, the cash portion of the application monies will be used in respect of such applications before the CPF Funds are used. An applicant applying for 1,000 Offer Units must use either cash only or CPF Funds only. (9) You irrevocably agree and undertake to subscribe for and to accept the number of Offer Units applied for as stated on the Transaction Record or the Confirmation Screen or any lesser number of such Offer Units that may be allocated to you in respect of your Electronic Application. In the event that the Manager decides to allocate any lesser number of such Offer Units or not to allocate any Offer Units to you, you agree to accept such decision as final. If your Electronic Application is successful, your confirmation (by your action of pressing the Enter or OK or Confirm or Yes or any other relevant key on the ATM) of the number of Offer Units applied for shall signify and shall be treated as your acceptance of the number of Offer Units that may be allocated to you and your agreement to be bound by the Trust Deed.

(7)

(8)

(b)

(c)

(10) The Manager will not keep any applications in reserve. Where your Electronic Application is unsuccessful, the full amount of the application monies will be returned (without interest or any share of revenue or other benefit arising therefrom) to you by being automatically credited to your account with the Participating Bank, at your own risk, within 24 hours (or such shorter period as the SGX-ST may require) after the close of the balloting provided that the remittance in respect of such application which has been presented for payment or other processes has been honoured and the application monies received in the designated unit issue account.
G-10

Appendix G Where your Electronic Application is accepted in full or in part only, the balance of the application monies will be returned (without interest or any share of revenue or other benefit arising therefrom) to you by being automatically credited to your account with the Participating Bank, at your risk, within 14 Market Days after the close of the Offering provided that the remittance in respect of such application which has been presented for payment or other processes has been honoured and the application monies received in the designated unit issue account. If the Offering does not proceed for any reason, the full amount of application monies (without interest or any share of revenue or other benefit arising therefrom) will be returned to you within three Market Days after the Offering is discontinued. Responsibility for timely refund of application monies (whether from unsuccessful or partially successful Electronic Applications or otherwise) lies solely with the Participating Banks. Therefore, you are strongly advised to consult the relevant Participating Bank as to the status of your Electronic Application and/or the refund of any money to you from an unsuccessful or partially successful Electronic Application, to determine the exact number of Offer Units, if any, allocated to you before trading the Units on the SGX-ST. None of the SGX-ST, CDP , SCCS, the CPF Board, the Participating Banks, the Manager, the Trustee, or the Joint Lead Managers and Underwriters assume any responsibility for any loss that may be incurred as a result of you having to cover any net sell positions or from buy-in procedures activated by the SGX-ST. (11) If your Electronic Application is unsuccessful, no notification will be sent by the Participating Banks. Applicants who make Electronic Applications through the Participating Banks may check the provisional results of their Electronic Applications as follows:
Bank Telephone Other Channels Operating Hours Service expected from

OCBC Bank 1 800 363 3333

ATM / Internet Banking / Phone Banking(1) Internet Banking www.dbs.com

24 hours a day

Evening of the balloting day Evening of the balloting day

DBS Bank

1 800 339 6666 (POSB account holders) 1 800 111 1111 (DBS account holders) 1 800 222 2121

24 hours a day

UOB Group

ATM (Other TransactionsIPO Enquiry)(2) www.uobgroup.com(2)

ATM / Phone Banking 24 hours a day Internet Banking 24 hours a day

Evening of the balloting day

Notes: (1) If you have made your Electronic Application through the ATMs of the OCBC Bank, you may check your results of your application through OCBC Personal Internet Banking, OCBC ATMs and OCBC Phone Banking Services. (2) If you have made your Electronic Application through the ATM of UOB Group, you may check the results of your application through UOB Personal Internet Banking, UOB Groups ATMs or UOB Phone Banking services. (12) Electronic Applications shall close at 12.00 p.m. on 15 November 2007 or such other date(s) and time(s) as the Manager may agree with the Joint Lead Managers, Issue Managers and Underwriters. (13) You are deemed to have irrevocably requested and authorised the Trustee or the Manager to: (a) register the Offer Units allotted and/or allocated to you in the name of CDP for deposit into your Securities Account;
G-11

Appendix G (b) return or refund (without interest or any share of revenue or other benefit arising therefrom) the application monies, should your Electronic Application be rejected or if the Offering does not proceed for any reason, by automatically crediting your bank account with the Participating Bank, by ordinary post at your risk, with the relevant amount within 24 hours after balloting, or within three Market Days if the Offering does not proceed for any reason, after the close or discontinuation (as the case may be) of the Offering, PROVIDED THAT the remittance in respect of such application which has been presented for payment or such other processes has been honoured and application monies received in the designated unit issue account; and return or refund (without interest or any share of revenue or other benefit arising therefrom) the balance of the application monies should your Electronic Application be accepted or accepted in part only, by automatically crediting your bank account with the Participating Bank, by ordinary post at your risk, with the relevant amount within 14 Market Days after the close of the Offering, PROVIDED THAT the remittance in respect of such application which has been presented for payment or such other processes has been honoured and application monies received in the designated unit issue account.

(c)

(14) You irrevocably agree and acknowledge that your Electronic Application is subject to risks of electrical, electronic, technical and computer-related faults and breakdown, fires, acts of God and other events beyond the control of the Participating Bank, the Manager, the Trustee and the Joint Lead Managers, Issue Managers and Underwriters, and if, in any such event the Manager, the Trustee, the Joint Lead Managers, Issue Managers and Underwriters and/or the Participating Bank do not receive your Electronic Application, or any data relating to your Electronic Application or the tape or any other devices containing such data is lost, corrupted or not otherwise accessible, whether wholly or partially for whatever reason, you shall be deemed not to have made an Electronic Application and you shall have no claim whatsoever against the Manager, the Trustee, the Joint Lead Managers, Issue Managers and Underwriters and/or the Participating Bank for any Offer Units applied for or for any compensation, loss or damage. (15) The existence of a trust will not be recognised. Any Electronic Application by a trustee must be made in his own name and without qualification. The Manager shall reject any application by any person acting as nominee except those made by approved nominee companies only. (16) All your particulars in the records of the Participating Bank at the time you make your Electronic Application shall be deemed to be true and correct and the Participating Bank and the Relevant Parties shall be entitled to rely on the accuracy thereof. If there has been any change in your particulars after making your Electronic Application, you must promptly notify the Participating Bank. (17) You should ensure that your personal particulars as recorded by both CDP and the Participating Bank are correct and identical. Otherwise, your Electronic Application is liable to be rejected. You should promptly inform CDP of any change in address, failing which the notification letter on successful allocation will be sent to your address last registered with CDP . (18) In consideration of the Manager making available the Electronic Application facility, through the ATMs of the Participating Bank acting as agent of the Manager at the ATMs of the Participating Banks and agreeing to close the Application List as at 12 noon on 15 November 2007 or such other time or date as the Joint Lead Managers, Issue Managers and Underwriters may, in consultation with the Manager, decide, and by making and completing an Electronic Application, you agree that:(a) (b) your Electronic Application is irrevocable; your Electronic Application, the acceptance by the Manager and the contract resulting therefrom under the Offering shall be governed by and construed in accordance with the laws of Singapore and you irrevocably submit to the non-exclusive jurisdiction of the Singapore courts; none of CDP , the CPF Board, the Manager, the Joint Lead Managers, Issue Managers and Underwriters and the Participating Bank shall be liable for any delays, failures or inaccuracies in the recording, storage or in the transmission or delivery of data relating to your Electronic

(c)

G-12

Appendix G Application to the Manager, the Trustee or CDP due to breakdowns or failure of transmission, delivery or communication facilities or any risks referred to in paragraph 14 above or to any cause beyond their respective controls; (d) in respect of the Offer Units for which your Electronic Application has been successfully completed and not rejected, acceptance of your Electronic Application shall be constituted by written notification by or on behalf of the Manager and not otherwise, notwithstanding any payment received by or on behalf of the Manager; you will not be entitled to exercise any remedy for rescission for misrepresentation at any time after acceptance of your application; and in making your application, reliance is placed solely on information contained in this Prospectus and that none of the Manager, the Trustee, the Joint Lead Managers, Issue Managers and Underwriters, or any other person involved in the Offering shall have any liability for any information not contained therein.

(e) (f)

Steps for Electronic Applications Instructions for Electronic Applications will appear on the ATM screens of the Participating Banks. For illustration purposes, the steps for making an Electronic Application through ATMs of OCBC Bank are shown below. Certain words appearing on the screen are in abbreviated form (a/c, appln, ESA, no. and & refer to account, application, electronic share application, number and and respectively). Instructions for Electronic Applications appearing on the ATM screens of the other Participating Banks may differ from those represented below. Step 1: 2: 3: 4: 5: 6: Insert your personal OCBC ATM card Enter your Personal Identification Number Select Other Services Select Electronic Security Appln Select LMIRT For an applicant making an Electronic Application at the ATM for the first time (a) For non-Singaporean Press the Yes key if you are a permanent resident of Singapore, otherwise, press the No key. (b) Enter your own Securities Account number (12 digits) eg. 168101234567 and press Yes key to confirm that the Securities Account number you have entered is correct. 7: 8: Check your particulars appearing on the screen and press the Correct key to confirm that your particulars are correct. Press the Confirm key to confirm that you have read the following messages:- A copy of this Prospectus has been lodged with and registered by the Monetary Authority of Singapore, which assumes no responsibility for its contents - The Prospectus is available at various Participating Banks 9: Press the Confirm key again to confirm that you have read the following messages:- Anyone who intends to submit an application for these securities should read the Prospectus before submitting his/her application in the manner set out in the Prospectus 10: Press the Confirm key again to confirm that you have read the following messages:- You have read, understood and agreed to all terms of application set out in the Prospectus
G-13

Appendix G - You consent to the disclosure of your NRIC/Passport No., address, nationality, securities a/c no., quantity of securities applied for and CPF investment account no. to share registrar, CDP, CPF, SCCS, Issuer & Vendors - This application is made in your own name and at your own risk 11: Select the number of Units you wish to apply for:- For fixed price ESA, this is the only application submitted - Fixed Price S$0.80 12: Select the type of bank account to debit your application monies 13: Check the details of your application appearing on the screen and press the Confirm key to confirm your application. 14: For customers with multiple bank accounts, select the bank account from which to debit your application monies

G-14

Appendix G Terms and Conditions for Use of CPF Funds (1) If you are using CPF Funds to subscribe for the Units, you must have a CPF Investment Account maintained with the relevant CPF approved bank at the time of your application. If you are applying for the Units through an Electronic Application, you must have an ATM card with the Participating Bank at the time of your application before you can use the ATMs of the Participating Banks to apply for the Units. The CPF Investment Account is governed by the Central Provident Fund (Investment Schemes) Regulations, as amended. (2) CPF Funds may only be withdrawn for applications for the Units in lots of 1,000 Units or integral multiples thereof. (3) If you are applying for the Units using a printed Application Form and you are using CPF Funds to apply for the Units, you must submit a CPF Cashiers Order for the total amount payable for the number of Units applied for using CPF Funds. (4) Before you apply for the Units using your CPF Funds, you must first make sure that you have sufficient funds in your CPF Investment Account to pay for the Units. You need not instruct the CPF Board to transfer your CPF Funds from your CPF Ordinary Account to your CPF Investment Account. If the balance in your CPF Investment Account is insufficient and you have sufficient investible CPF Funds in your CPF Ordinary Account, the relevant CPF approved bank with which you maintain your CPF Investment Account will automatically transfer the balance of the required amount from your CPF Ordinary Account to your CPF Investment Account immediately for you to use these funds to buy a CPF Cashiers Order from the relevant CPF approved bank in the case of an application by way of a printed Application Form or submit your application through the Participating Bank in the case of an application by way of an Electronic Application. The automatic transfer facility is available until the close of the Public Offer within the operating hours of the facility which are between 12 noon and 10.00 p.m. from Mondays to Saturdays, and between 12 noon and 5.00 p.m. on Sundays and public holidays. (5) The special CPF securities sub-account of the nominee company of the relevant CPF approved bank (with whom you maintain a CPF Investment Account) maintained with CDP will be credited with the principal amount of the Units you subscribed for with CPF Funds. (6) Where you are using CPF Funds, you cannot apply for the Units as nominee for any other person. (7) All instructions or authorisations given by you in a printed Application Form or through an Electronic Application are irrevocable. (8) CPF Investment Accounts may be opened with any branch of the relevant CPF approved bank. (9) All information furnished by the CPF Board, the relevant CPF approved bank and the Participating Bank on your authorisation will be relied on as being true and correct.

G-15

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Appendix H
LIST OF PRESENT AND PAST PRINCIPAL DIRECTORSHIPS OF DIRECTORS AND EXECUTIVE OFFICERS The principal present directorships, other than those held in the Manager and the principal past directorships in the last five years of each of the directors and executive officers (named in The Manager and Corporate Governance) of the Manager are as follows: Directors of the Manager (1) Mr Tan Bar Tien Current Directorships Millennium Assets Pte Ltd (2) Mr Lim Ho Seng Current Directorships Kian Ann Engineering Ltd Bollywood Veggies Pte Ltd Baker Technology Limited Sim Siang Choon Ltd Pan Asian Water Solutions Limited K S Energy Services Limited Past Directorships (for a period of five years preceding 11 September 2007) Flairis Technology Corp. Ltd Integra2000 Pte Ltd Retail Promotions Centre Pte Ltd ecoWise Holdings Limited Prima Limited Sinwa Limited Norelco UMS Holdings Ltd Want Want Foundation Ltd Rotol Singapore Ltd Want Want Holdings Ltd Past Directorships (for a period of five years preceding 3 April 2007) Nil

(3) Ms Viven G. Sitiabudi (also known as Mrs Viven Gouw) Current Directorships PT Lippo Karawaci Tbk. PT Sentra Dwimandiri PT Prudential Development PT Dinamika Intertrans PT Taman Sari Lippo Karawaci PT Sentra Office Realty PT Sentra Asritama Realty PT Prudential Town House Development PT Imperial Karawaci Golf PT Saptapersada Jagatnusa PT Wahana Tatabangun Cemerlang PT Wahana Tatabangun Cemerlang Matahari PT Bahterapratama Wirasakti PT Mulia Sentosa Dinamika Pt Sejatijaya Selaras PT Sentragraha Mandiri PT Suryamakmur Alam Persada Past Directorships (for a period of five years preceding 16 April 2007) Nil

H-1

Appendix H Past Directorships (for a period of five years preceding 16 April 2007)

Current Directorships PT Paragon City PT Lippo Karawaci Infrastructure & Utilities Division PT Sentra Realtindo Development PT Darma Sarana Nusa Pratama PT Tata Mandiri Daerah Villa Permata PT Agung Sepadan PT Golden Pradamas PT Mulia Bangun Semesta PT Villa Permata Cibodas PT Puncak Resort International PT Dona Indo Prima PT Sukmaprima Sejahtera PT Adigraha Rancang Sempurna PT Sentosa Seksama PT Pesanggarahan Suri Permata Agung PT Purimegah Swarga Buana PT Graha Tata Cemerlang Makassar PT Niaga Utama PT Siloam Sarana Karya PT Siloam Karya Sejahtera PT East Jakarta Medika PT Almaron Perkasa PT Siloam Graha Utama PT Siloam Dinamika Perkasa PT Siloam Tata Prima (4) Mr Yeo Cheow Tong Current Directorships KillyInvest Pte Ltd (5) Mr Lok Vi Ming Current Directorships Singapore Cruise Centre Pte Ltd Singex Venues Pte Ltd Singex Exhibitions Pte Ltd Singex Exhibitions Venture Pte Ltd Mount Faber Leisure Group Pte Ltd Singapore Food Industries Limited Bethesda Bedok-Tampines Church Ltd

Past Directorships (for a period of five years preceding 3 November 2007) Central Asia Mineral Exploration Pte. Ltd.

Past Directorships (for a period of five years preceding 18 May 2007) Changi International Airport Services Pte Ltd International Factors (Singapore) Ltd CIAS International Ltd

H-2

Appendix H (6) Mr Tan Boon Leong Current Directorships The HarbourFront Pte Ltd HarbourFront One Pte Ltd HarbourFront Two Pte Ltd HarbourFront Three Pte Ltd HarbourFront Four Pte Ltd HarbourFront Place Pte. Ltd. HarbourFront Centre Pte. Ltd. VivoCity Pte. Ltd. HarbourFront Eight Pte Ltd St James Power Station Pte. Ltd. HarbourFront Dalian Pte. Ltd. Bougainvillea Realty Pte Ltd Heliconia Realty Pte Ltd Cantonment Realty Pte Ltd HF (USA), Inc. (incorporated in the State of Delaware) Dalian Marina Centre Development Co., Ltd (incorporated in the Republic of China) Mapletree Treasury Services Limited Mapletree Capital Management Pte. Ltd. Mapletree Mezzanine Managers Pte. Ltd. Meranti Investments Pte. Ltd. Mapletree Logistics Trust Management Ltd. CIMB-Mapletree Management Sdn. Bhd. (incorporated in Malaysia) Sienna Pte. Ltd. Mangrove Pte. Ltd. Mapletree Dextra Pte. Ltd. Mapletree Overseas Holdings Ltd. (incorporated in the Cayman Islands) Mapletree Amethyst Ltd. (incorporated in the Cayman Islands) Shanghai Mapletree Management Consultancy Co., Ltd (incorporated in the Republic of China) Mapletree WND (Wuxi) Ltd. (incorporated in the Cayman Islands) Mapletree Emerald Ltd. (incorporated in the Cayman Islands) Mapletree Citrine Ltd (incorporated in the Cayman Islands) Mapletree VSIP 2 Phase 2 (Cayman) Co. Ltd. (incorporated in the Cayman Islands) Mapletree VSIP 2 Phase 1 (Cayman) Co. Ltd. (incorporated in the Cayman Islands) Mapletree VSIP 1 Warehouse (Cayman) Co. Ltd. Past Directorships (for a period of five years preceding 16 May 2007) LCD (Vietnam) Pte Ltd Plumtree Investments Pty Ltd MCH Services (Sydney) Pte Ltd Sing-Mas Investments Pte Ltd P T Bintan Lagoon Bintan Lagoon Resort Limited Avondale Properties Ltd Gasin (Suzhou) Property Development Co Ltd Kingsdale Development Pte Ltd Prestige Landmark Pte Ltd Suzhou Property Development Pte Ltd Union Charm Development Ltd P T Purimas Straits Resorts Kunming Yunxin Tourist Development Co Ltd Shanghai Hua Qing Real Estate Development Co Ltd Hua Qing Holdings Pte Ltd Hard Rock Hotels & Resorts Management Pte Ltd Wesclove Investments Pte Ltd Hua Yuan Holdings Pte Ltd Shanghai Pudong Xinxiang Real Estate Development Co Ltd Marina Centre Holdings Pte Ltd Crown Million Enterprises Limited Ascendas Holdings (Manila) Pte Ltd JTCI Industrial Holdings (Bangkok) Pte Ltd SembCorp Parks Management Pte Ltd Singapore-Suzhou Industrial Holdings Pte Ltd Asean Bintulu Fertilizer Sdn Bhd Crown Pacific Development Ltd Beijing Hong Gong Garden Villa House Property Development Co Ltd Keppel Regional Infrastructure Pte Ltd SembCorp Gas Pte Ltd SembCorp Parks Management Pte Ltd. Germiston Developments Ltd Catalyst Enterprises Ltd Singapore Cruise Centre Pte Ltd Mapletree Topaz Ltd. Mapletree Opal Ltd.

H-3

Appendix H Past Directorships (for a period of five years preceding 16 May 2007)

Current Directorships (incorporated in the Cayman Islands) Mapletree Lingang Ltd. (incorporated in the Cayman Islands) Mapletree Logistics Properties Pte. Ltd. Mapletree Trustee Pte. Ltd. Mapletree ALP (Tianjin) Ltd. (incorporated in the Cayman Islands) Mapletree First Warehouse (Vietnam) Co., Ltd. (incorporated in Vietnam) Mapletree (Tianjin) Airport Logistics Development Co., Ltd. (incorporated in the Peoples Republic of China) Mapletree Industrial Holdings Ltd. (incorporated in the Cayman Islands) Vista Real Estate Investments Pte Ltd Alexandra Distripark Pte Ltd Mapletree Vietnam Management Consultancy Co., Ltd. (incorporated in Vietnam) Mapletree Industrial Fund Ltd. (incorporated in the Cayman Islands) Mapletree Industrial Fund Management Pte. Ltd. Mapletree Lingang Logistics Warehouse (Shanghai) Co., Ltd. (incorporated in the Peoples Republic of China) Mapletree Emerald (HKSAR) Limited (incorporated in Hong Kong) Mapletree Changxing (Shanghai) Ltd. (incorporated in the Cayman Islands) Mapletree MIC Changsha Ltd. (incorporated in the Cayman Islands) Mapletree MIC Shenyang Retail Ltd. (incorporated in the Cayman Islands) Mapletree Changxing (Shanghai) (HKSAR) Limited (incorporated in Hong Kong) Mapletree MIC Changsha (HKSAR) Limited (incorporated in Hong Kong) Mapletree MIC Shenyang Retail (HKSAR) Limited (incorporated in Hong Kong) Mapletree Caoan Ltd. (incorporated in the Cayman Islands) Mapletree Jinshajiang Ltd. (incorporated in the Cayman Islands) Mapletree MIC Xian Ltd. (incorporated in the Cayman Islands) Freesia Investments Ltd. (incorporated in the Cayman Islands) Clematis Investments Ltd. (incorporated in the Cayman Islands)

H-4

Appendix H Past Directorships (for a period of five years preceding 16 May 2007)

Current Directorships Mapletree MIC Xian (HKSAR) Limited (incorporated in Hong Kong) Lippo-Mapletree Indonesia Retail Trust Management Ltd. Lot A Sentral Sdn. Bhd. (incorporated in Malaysia) Xian Yajian Real Estate Development Co., Ltd. (incorporated in the Peoples Republic of China) Mapletree Commercial Trust Management Ltd. Mapletree Developments Pte. Ltd. Mapletree MIC China Holdings Ltd. (incorporated in the Cayman Islands) Mapletree MIC India Holdings Ltd. (incorporated in the Cayman Islands) Mapletree MIC Shenyang SA Ltd. (incorporated in the Cayman Islands) Binh Duong Industrial 1 Ltd. (incorporated in the Cayman Islands) Binh Duong Real Estate 1 Ltd. (incorporated in the Cayman Islands) Binh Duong Real Estate 2 Ltd. (incorporated in the Cayman Islands) Mapletree MIC Shenyang SA (HKSAR) Limited (incorporated in Hong Kong) Mapletree Logistics Park Phase 1 (Vietnam) Co., Ltd. (incorporated in Vietnam) Mapletree Logistics Park Phase 2 (Vietnam) Co., Ltd. (incorporated in Vietnam) (7) Mr Wong Mun Hoong Current Directorships The HarbourFront Pte Ltd HarbourFront Four Pte Ltd HarbourFront Place Pte. Ltd. HarbourFront Centre Pte. Ltd. VivoCity Pte. Ltd. St James Power Station Pte. Ltd. Bougainvillea Realty Pte Ltd Heliconia Realty Pte Ltd Alexandra Distripark Pte Ltd Alexandra Terrace Pte Ltd Mapletree Treasury Services Limited Mapletree Trustee Pte. Ltd. Mapletree Capital Management Pte. Ltd. Meranti Investments Pte. Ltd. Mapletree Dextra Pte. Ltd.

Past Directorships (for a period of five years preceding 16 May 2007) Merrill Lynch (Singapore) Pte Ltd

H-5

Appendix H Past Directorships (for a period of five years preceding 16 May 2007)

Current Directorships Mapletree Overseas Holdings Ltd. (incorporated in the Cayman Islands) Mapletree Amethyst Ltd. (incorporated in the Cayman Islands) Mapletree WND (Wuxi) Ltd. (incorporated in the Cayman Islands) Mapletree Emerald Ltd. (incorporated in the Cayman Islands) Mapletree Citrine Ltd (incorporated in the Cayman Islands) Mapletree VSIP 2 Phase 2 (Cayman) Co. Ltd. (incorporated in the Cayman Islands) Mapletree VSIP 2 Phase 1 (Cayman) Co. Ltd. (incorporated in the Cayman Islands) Mapletree VSIP 1 Warehouse (Cayman) Co. Ltd. (incorporated in the Cayman Islands) Mapletree Mezzanine Managers Pte. Ltd. CIMB-Mapletree Management Sdn. Bhd. (incorporated in Malaysia) Era One Ventures Sdn. Bhd. (incorporated in Malaysia) Jaya Section Fourteen Sdn. Bhd. (incorporated in Malaysia) Mapletree First Warehouse (Vietnam) Co., Ltd. (incorporated in Vietnam) Mapletree (Tianjin) Airport Logistics Development Co., Ltd. (incorporated in the Peoples Republic of China) Mapletree Industrial Holdings Ltd. (incorporated in the Cayman Islands) HarbourFront Two Pte Ltd HarbourFront Three Pte Ltd Cantonment Realty Pte Ltd Dynamic Concept One Sdn. Bhd. (incorporated in Malaysia) Mapletree Logistics Trust Management Ltd. Mapletree Industrial Fund Management Pte. Ltd. Mapletree Real Estate Mezzanine Fund I Limited (incorporated in the Cayman Islands) Mapletree Lingang Logistics Warehouse (Shanghai) Co., Ltd. (incorporated in the Peoples Republic of China) Mapletree MIC Changsha Ltd. (incorporated in the Cayman Islands) Mapletree MIC Shenyang Retail Ltd. (incorporated in the Cayman Islands) Mapletree MIC Changsha (HKSAR) Limited (incorporated in Hong Kong)

H-6

Appendix H Past Directorships (for a period of five years preceding 16 May 2007)

Current Directorships Mapletree MIC Shenyang Retail (HKSAR) Limited (incorporated in Hong Kong) Mapletree Caoan Ltd. (incorporated in the Cayman Islands) Mapletree Jinshajiang Ltd. (incorporated in the Cayman Islands) Mapletree MIC Xian Ltd. (incorporated in the Cayman Islands) Freesia Investments Ltd. (incorporated in the Cayman Islands) Clematis Investments Ltd. (incorporated in the Cayman Islands) Mapletree MIC Xian (HKSAR) Limited (incorporated in Hong Kong) Mapletree Tianjin Free Port Development Ltd. (incorporated in the Cayman Islands) Mapletree Shunyi (Beijing) Ltd. (incorporated in the Cayman Islands) Mapletree Tianjin Free Port Development (HKSAR) Limited (incorporated in Hong Kong) Mapletree India China Fund Ltd. (incorporated in the Cayman Islands) Lippo-Mapletree Indonesia Retail Trust Management Ltd. Mapletree Shunyi (Beijing) (HKSAR) Limited (incorporated in Hong Kong) Mapletree Hinjewadi (Mauritius) Ltd. (incorporated in Mauritius) Lot A Sentral Sdn. Bhd. (incorporated in Malaysia) Mapletree Mauritius 1 Ltd. (incorporated in Mauritius) Mapletree Mauritius 2 Ltd. (incorporated in Mauritius) Mapletree Mauritius 3 Ltd. (incorporated in Mauritius) Mapletree MIC China Holdings Ltd. (incorporated in the Cayman Islands) Mapletree MIC India Holdings Ltd. (incorporated in the Cayman Islands) Mapletree MIC Shenyang SA Ltd. (incorporated in the Cayman Islands) Binh Duong Industrial 1 Ltd. (incorporated in the Cayman Islands) Binh Duong Real Estate 1 Ltd. (incorporated in the Cayman Islands) Binh Duong Real Estate 2 Ltd. (incorporated in the Cayman Islands) Mapletree MIC Shenyang SA (HKSAR) Limited (incorporated in Hong Kong)

H-7

Appendix H Past Directorships (for a period of five years preceding 16 May 2007)

Current Directorships Mapletree Logistics Park Phase 1 (Vietnam) Co., Ltd. (incorporated in Vietnam) Mapletree Logistics Park Phase 2 (Vietnam) Co., Ltd. (incorporated in Vietnam) Surbana Township Development Fund Pte. Ltd. Executive Officers of the Manager (1) Mr Rudi Chuan Hwee Hiow Current Directorships Nil (2) Mr Jeremy Scott Walker Current Directorships Nil (3) Ms Viven G. Sitiabudi (also known as Mrs Viven Gouw) Current Directorships Please refer to the relevant section under the list of directors above. (4) MR ANDREAS KARTAWINATA Current Directorships PT Lippo Karawaci Tbk

Past Directorships (for a period of five years preceding 8 March 2007) Nil

Past Directorships (for a period of five years preceding 21 April 2007) Nil

Past Directorships (for a period of five years preceding 8 March 2007) Please refer to the relevant section under the list of directors above.

Past Directorships (for a period of five years preceding 8 March 2007) PT Metropolitan Kentjana Tbk

H-8

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LIPPO-MAPLETREE INDONESIA RETAIL TRUST SPONSOR PT. Lippo Karawaci Tbk Menara Matahari, 22nd floor Jl. Boulevard Palem Raya No. 7 Lippo Karawaci Tangerang 15811, Banten, Indonesia MANAGER Lippo-Mapletree Indonesia Retail Trust Management Ltd. 78 Shenton Way #05-01 Lippo Centre Singapore 079120 SOLE FINANCIAL ADVISER TO THE SPONSOR PT. Ciptadana Capital Citra Graha 8th Floor Jalan Jend. Gatot Subroto Kav 35-36 Jakarta 12950, Indonesia SOLE FINANCIAL ADVISER TO THE OFFERING UBS AG, acting through its business group, UBS Investment Bank One Raffles Quay #50-01 North Tower Singapore 048583

JOINT LEAD MANAGERS, ISSUE MANAGERS AND UNDERWRITERS UBS AG, acting through its business group, UBS Investment Bank One Raffles Quay #50-01 North Tower Singapore 048583 BNP Paribas Capital (Singapore) Ltd. 20 Collyer Quay #08-01 Tung Centre Singapore 049319 Oversea-Chinese Banking Corporation Limited 65 Chulia Street #29-02/04 OCBC Centre Singapore 049513 TRUSTEE HSBC Institutional Trust Services (Singapore) Limited 21 Collyer Quay #14-01 HSBC Building Singapore 049320

UNIT REGISTRAR AND UNIT TRANSFER OFFICE Boardroom Corporate & Advisory Services Pte. Ltd. (formerly known as Lim Associates (Pte) Ltd) 3 Church Street #08-01 Samsung Hub Singapore 049483

LEGAL ADVISERS Legal Adviser to the Offering, and to the Manager, the Sponsor and the Vendors Allen & Gledhill LLP One Marina Boulevard #28-00 Singapore 018989 Legal Adviser to the Underwriters as to Singapore Law Stamford Law Corporation 9 Raffles Place #32-00 Republic Plaza Singapore 048619 Legal Adviser to the Manager and the Sponsor as to Indonesian Law Makes & Partners Law Firm Menara Batavia 7th Floor JI.K.H. Mas Mansyur Kav. 126 Jakarta 10220 Indonesia Legal Adviser to the Underwriters as to U.S. federal securities and English laws Latham & Watkins LLP 9 Raffles Place #42-02 Republic Plaza Singapore 048619 Legal Adviser to the Vendors as to Indonesian Law Hadiputranto Hadinoto & Partners The Jakarta Stock Exchange Building Tower II, 21st Floor Sudirman Central Business District Jl. Jendral Sudirman Kav. 52-53 Jakarta 12190, Indonesia Legal Adviser to the Trustee Shook Lin & Bok LLP 1 Robinson Road #18-00 AIA Tower Singapore 048542 INDEPENDENT REPORTING ACCOUNTANTS RSM Chio Lim 18 Cross Street #09-01 Marsh & McLennan Centre Singapore 048423 INDEPENDENT SINGAPORE TAX ADVISER Ernst & Young One Raffles Quay North Tower, Level 18 Singapore 048583 INDEPENDENT VALUER TO THE MANAGER Knight Frank / PT. Willson Properti Advisindo Wisma Nugra Santana #17-03 Jl. Jend. Sudirman Kav. 7-8 Jakarta 10220, Indonesia RSM Aryanto Amir Jusuf & Mawar (RSM AAJ Associates) Plaza ABDA 10th Floor Jl. Jend.Sudirman Kav.59 Jakarta 12190 Indonesia INDEPENDENT INDONESIAN TAX ADVISER PB & Co. Menara Imperium 27th Floor Jl. H.R. Rasuna Said Kav. 1 Jakarta 12980 Indonesia INDEPENDENT VALUER TO THE TRUSTEE Colliers International / PT Penilai 10F World Trade Centre Jl Jenderal Sudirman Kav 29-31 Jakarta 12920, Indonesia Legal Adviser to the Underwriters as to Indonesian Law Ery Yunasri & Partners Graha Niaga 11th Floor JI. Jenderal Sudirman Kav. 58 Jakarta 12190 Indonesia

INDEPENDENT INDONESIAN RETAIL PROPERTY CONSULTANT PT Jones Lang LaSalle Jakarta Stock Exchange Building Tower 1 28th floor Jl Jenderal Sudirman Kav 52-53 Jakarta 12190, Indonesia

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