12. INVESTMENT PROPERTIES
The increase in fair value is due to the acquisitions during the year and improvements in fair value estimates due to
changes in key inputs. The Group’s portfolio consists of properties located in Indonesia, Singapore and South Korea
(see the statements of portfolio). These investment properties include the mechanical and electrical equipment located
in the respective properties.
#a. The additions in 2014 are for the acquisition of Siloam Hospitals Purwakarta and Siloam Sriwijaya (Note 18). This
includes capitalised transaction costs of S$1,837,000. The additions in 2013 were for the acquisition of Siloam
Hospitals Bali and Siloam Hospitals TB Simatupang amounting to S$97.3 million and S$93.1 million respectively.
The additions included capitalised transaction costs of S$3,297,000.
The fair value of each investment property was measured in October 2014 and updated on 31 December 2014 based
on the highest and best use method to reflect the actual market state and circumstances as of the end of the reporting
year. The valuations were based on the discounted cash flow and direct capitalisation methods as appropriate. The fair
value was based on valuations made by independent valuers on a systematic basis at least once yearly. In relying on the
valuation reports, the management is satisfied that the independent valuers have appropriate professional qualifications,
are independent and have recent experience in the location and category of the properties being valued. There has been
no change to the valuation techniques during the year. Management determined that the highest and best use of the
asset is the current use and that it would provide maximum value to market participants principally through its use in
combination with other assets.
The fair values for 2014 were made by the following firms of independent professional valuers:
1.
Five Indonesia properties – KJPP Willson & Rekan in association with Knight Frank
2. Five Indonesia properties – KJPP Rengganis, Hamid & Rekan in strategic alliance with CBRE Pte Ltd
3. One Indonesia property – KJPP Rinaldi, Alberth, Baroto & Rekan in association with DTZ
4. One Indonesia property – KJPP Winarta & Rekan in alliance with Jones Lang LaSalle
5. All Singapore properties – CBRE Pte Ltd
6. The South Korea property – CBRE Pte Ltd
NOTES TO THE
FINANCIAL STATEMENTS
31 DECEMBER 2014
Group
Trust
2014
2013
2014
2013
S$’000
S$’000
S$’000
S$’000
At valuation:
Fair value at beginning of year
1,052,266
796,702
39,100
38,300
Additions at cost
#a
72,217
193,859
219
122
Translation differences
358
371
–
–
Increase/(decrease) in fair value included in statements
of total return under increase/(decrease) in fair values
of investment properties (Level 3)
47,174
61,334
(619)
678
Fair value at end of year
1,172,015
1,052,266
38,700
39,100
Rental income from investment properties
93,255
83,280
3,615
3,458
Direct operating expenses (including repairs and
maintenance) arising from investment properties that
generated rental income during the reporting year
1,382
3,072
97
120
70
FIRST REIT
ANNUAL REPORT 2014
