Keppel Land despatches documents on K-REIT Asia to shareholders

The listing of K-REIT Asia and distribution in specie together represent an important milestone which will both unlock value for Keppel Land shareholders and assist the Company in enhancing its position as a premier multi-national real estate corporation in Asia by way of leveraging its sterling portfolio of properties, strong network and quality brand.

For Keppel Land, the distribution in specie establishes K-REIT Asia which will facilitate the re-deployment of capital in investment properties to property development projects to generate higher returns; create an enlarged platform to generate fee-based income and return significant sums of equity back to its shareholders.

For Keppel Land shareholders, the formation and listing of K-REIT Asia will permit higher payouts from the initial portfolio of properties, give tax transparency for Qualifying Unitholders, transfer the benefit of about S$ 53.2 million in Section 44A tax credits to shareholders and provide shareholders with more choice and improved liquidity.

K-REIT Asia will have an initial portfolio of four high quality office buildings from Keppel Land's stable of commercial developments:

- Prudential Tower*;
- Keppel Towers and GE Tower; and
- Bugis Junction Towers

* about 44% of the total strata area of Prudential Tower

Valued at S$630.7 million, K-REIT Asia's initial portfolio has strong potential to capitalise on rising office occupancy levels and rental rates in Singapore.

Quality tenants including International Enterprise Singapore, Prudential Assurance, InterContinental Hotels Group, GE Pacific, Novartis, The McGraw-Hill Companies, KBC Bank and California Fitness provide a good, diverse tenant base, which will support K-REIT Asia's earnings.

Subject to shareholders' approval at the upcoming EGM on 11 April 2006, each Keppel Land shareholder will receive 200 K-REIT Asia Units for every 1,000 Keppel Land shares held as at 5.00 p.m. on 18 April 2006. No cash consideration is payable for these Units as this is a distribution in specie in lieu of a cash dividend. In so doing, Keppel Land will distribute up to 144,400,000 Units (or approximately 60%) of the 240,508,000 Units issued in part consideration for the sale and purchase of the properties. Keppel Land Group will retain approximately 40% of the issued Units.

Professor Tsui Kai Chong, the Chairman of K-REIT Asia and a Director of Keppel Land and the Professor of Finance and Provost of SIM University, said, "K-REIT Asia's initial portfolio of high quality properties will generate stable income and forms a strong foundation from which K-REIT Asia will grow. K-REIT Asia will be able to tap on Keppel Land's expertise, market knowledge of managing commercial properties and industry network for prospective yield-accretive acquisitions."

Should shareholders approve the distribution in specie, it is envisaged that trading of K-REIT Asia Units will commence on 28 April 2006. Further details on the introduction of K-REIT Asia to the Main Board of SGX-ST and on the distribution in specie are set out in Keppel Land's circular and introductory document dated 20 March 2006 posted on SGXNET.

About Keppel Land

Keppel Land is one of the largest listed property companies by total assets on the Singapore Exchange, recognised for its award-winning premier residential developments and investment-grade offices. It is geographically diversified in Asia with a current focus in Singapore, China, India, Vietnam, Indonesia and Thailand.

In Singapore, Keppel Land is perhaps the largest landlord in the prime office area of the central business district with a premier office portfolio housing multinational corporations, banks and financial institutions.

Keppel Land, together with partners, has been awarded the tender to develop Singapore's Business and Financial Centre. An agreement was signed with the URA on 25 October 2005 for the purchase of the first phase of the 3.55-ha development, which will comprise a total of 244,000 square metres of prime office, residential and retail space. The site is adjacent to One Raffles Quay development being undertaken by the same partnership consortium.

One Raffles Quay is the latest premier office development in the Central Business District to come into the market. On completion in 2006, One Raffles Quay will provide approximately 122,000 square metres of net lettable prime office space. The property is currently over 70 per cent pre-committed to leading tenants including ABN AMRO, Deutsche Bank and UBS.

Keppel Land, in partnership with Harrah's Entertainment, are bidding for the upcoming Integrated Resort in Marina Bay.

Contact Information:

Media Relations
Ms Teri Liew
Senior Manager, Group Corporate Communications
Keppel Corporation
Tel: 9686 4038

Investor Relations
Ms Serena Toh
Assistant GM, Investor Relations & Research
Keppel Land Tel: 6433 7546