ESR AR 2019 EN

MESSAGE FROM CEOs This strong capital raising capability by ESR was also demonstrated in the closing of the ESR Japan Logistics Fund III (RJLF III) with an initial investment capacity of up to JPY200 billion (US$1.8 billion). 2019 was also a year in which we actively sought to identify and acquire strategic development sites across the markets. Some of the key sites included ESR Yokohama Sachiura Distribution Centre which is set to be the largest master-planned logistics park in Japan, and ESR Aisai Distribution Centre in Nagoya. Our total development pipeline across the portfolio, as a result, increased to 14.1 million sqm. During the year, we completed a number of development projects that translated to an investment value of US$1.9 billion, representing a GFA of 1 million sqm. We have maintained our standards of building best-in- class facilities with advanced modern specifications, state-of-the-art architecture and sustainability elements. Our network of prime facilities located strategically across Asia Pacific’s most important cities and business hubs has continuously gained the support of a growing number of blue-chip international and domestic tenants, especially e-commerce companies and 3PL providers. During the year, we maintained a high occupancy of 93% for stabilised assets on our balance sheet. Many of our tenants have been with us for years and across multiple markets. Our ability to forge such strong relationships has been a cornerstone of ESR’s long-term success. Commitment to integrating ESG considerations across the logistics real estate development cycle is an integral part of our corporate vision. We have built diligence, transparency and accountability processes into many aspects of our work. In 2019, ESR further strengthened our sustainability framework, organising material ESG issues for the business into three key pillars: People and Partners, Corporate Performance and Property Portfolio. Beyond fulfilling local health, safety and environmental regulations, we set a standard of going a step further for many of our projects and initiatives, and that has gained industry-wide recognition for ESR. From platform expansion to integration, capital raising to recycling, property development to tenant relationships and occupancy, our successful business model and growth strategy delivered on corporate targets in every one of our business areas. “ “ In South Korea, for example, we were proud to announce that our flagship Bucheon Logistics Park earned the first WELL Gold Certification in Asia Pacific’s logistics real estate for its outstanding achievement in creating a work environment based on promoting health and wellness. A growing number of other ESR developments have also won recognition by global standards such as the Comprehensive Assessment System for Built Environment Efficiency (CASBEE) in Japan, and the Leadership in Energy and Environmental Design (LEED) in China and South Korea, GBCA Green Star in Australia, and BCA Green Mark in Singapore. Markets ESR’s unique focus on Asia Pacific’s logistics real estate once again in 2019 delivered what may be the global industry’s best and most resilient opportunities for growth. However, as we turn to 2020, the global outbreak of COVID-19 has presented almost every person and business with uncertainties and disruptions. During this exceptional time, all of our teams are working diligently to ensure our facilities remain safe and efficient, and maintain the highest level of our service to our customers and capital partners. 19 ESR Annual Report 2019