2022 Annual Report

Stock Code: 01972 Annual Report 2022

CONTENTS 2 Company Profile AUDITOR’S REPORT AND ACCOUNTS 10 2022 Highlights 130 Independent Auditor’s Report 16 Financial Highlights 134 Consolidated Statement of Profit or Loss 17 Ten-Year Financial Summary 135 Consolidated Statement of 20 Chairman’s Statement Other Comprehensive Income 24 Chief Executive’s Statement 136 Consolidated Statement of Financial Position 28 Key Business Strategies 137 Consolidated Statement of Cash Flows 138 Consolidated Statement of Changes in Equity MANAGEMENT DISCUSSION & ANALYSIS 139 Notes to the Financial Statements 32 Review of Operations 198 Principal Accounting Policies 74 Financial Review 201 Principal Subsidiary, Joint Venture and 81 Financing Associated Companies CORPORATE GOVERNANCE & SUPPLEMENTARY INFORMATION SUSTAINABILITY 204 Schedule of Principal Group Properties 92 Corporate Governance 215 Glossary 108 Risk Management 216 Financial Calendar and Information 112 Directors and Officers for Investors 114 Directors’ Report 121 Sustainable Development

COMPANY PROFILE Swire Properties Limited (the “Company”) is a leading developer, owner and operator of mixed-use, principally commercial, properties in Hong Kong and the Chinese Mainland, with a record of creating long- term value by transforming urban areas. Our business comprises three elements: property investment, property trading and hotel investment. 2

Founded in Hong Kong in 1972, the Company is listed on Guangzhou, Chengdu and Shanghai. Similar in scale to The Stock Exchange of Hong Kong Limited and, with its our developments in Hong Kong, our Chinese Mainland subsidiaries, employs around 5,000 people. The Company’s properties are in commercial districts with excellent shopping malls are home to more than 2,200 retail outlets. transport connections. Its offices house a working population estimated to The Company has interests in the luxury and high quality exceed 72,000. residential markets in Hong Kong, Indonesia, Vietnam and In Hong Kong, we have spent 50 years developing an Thailand. There are also land banks in Miami, U.S.A. Swire industrial area into what is now Taikoo Place and Cityplaza, Hotels develops and manages hotels in Hong Kong, the one of Hong Kong’s largest business districts comprising Chinese Mainland and the U.S.A., with an expansion plan office space, the largest shopping mall on Hong Kong to Japan. Island and a hotel. Pacific Place, built on the former Victoria The Company has a presence in the Brickell financial Barracks site, is one of Hong Kong’s premier retail and district in Miami, U.S.A., where it has investment properties. business addresses. In the Chinese Mainland, the Company The Company has offices in South East Asia which explore has six major commercial projects in operation in Beijing, opportunities in the property markets in the region. 3 SWIRE PROPERTIES ANNUAL REPORT 2022

Fifty years ago, Swire Properties was established in Hong Kong, and built a reputation for outstanding quality and transformational placemaking. We are transforming places and supporting thriving communities around the world by putting our values, our creativity and our SD2030 Strategy into action. Over the years the Company has continued to grow, achieving wide recognition in Hong Kong and the Chinese Mainland, and establishing a presence across major world cities, including Miami, Singapore, Jakarta, Ho Chi Minh City and Bangkok.

In 2022, Swire Properties celebrated its 50th anniversary. To honour this milestone, the Company launched the year-long “ORIGINAL. ALWAYS.” campaign to highlight our innovative spirit and showcase our long-term vision and commitment to creating vibrant places.

Captures what we do and how we do it. It underlines the creative mindset and long-term approach that enables us to seek out new perspectives, and original thinking that goes beyond the conventional. 8

It also encapsulates our ability to unlock the potential of places and create vibrant destinations that can engender further growth and create sustainable value for our stakeholders. 9 SWIRE PROPERTIES ANNUAL REPORT 2022

2022 HIGHLIGHTS MAR Announced partnership with Xi’an Cheng Huan Cultural Investment and Development Co. Ltd. to develop Taikoo Li Xi’an Xi’an JUN Named “Hong Kong’s Most Attractive Employer” in Randstad’s 2022 Employer Brand Research Artist’s Impression Hong Kong MAY Won the bid for 269 Queen’s Celebrated Swire Properties’ 50th Road East residential anniversary with a series of arts development in the HKSAR SEP programmes, including continued Government’s Land Sale partnership with Art Basel Hong Programme Completed Two Taikoo Place Kong and inaugural Asian tour of Hong Kong office tower, the latest addition “Bags: Inside Out” by the Victoria to Taikoo Place and Albert Museum, London JUL–AUG Hong Kong Hong Kong Pursued new hotel management agreement model with two new The House Collective hotels in Tokyo and Shenzhen Tokyo and Shenzhen Officially rolled out the “Green Performance Pledge” for office tenants. As of 31 December, tenants Celebrated 10th anniversary of spanning 37.9% of occupied lettable INDIGO in Beijing floor area of the Hong Kong office Architectural Rendering Beijing portfolio have committed (Image by Proloog. Copyright:SnØhetta. Courtesy of Tokyu Corporation) Hong Kong 10

Completed EIGHT STAR STREET residential development with 29 units sold (as of 31 December) Hong Kong Artist’s Impression OCT DEC Announced new retail project Announced naming of new in Sanya in partnership with a office building on Queen’s Road subsidiary of China Tourism Group East as Six Pacific Place, and Duty Free Corporation renaming of 28 Hennessy Road Sanya as “Five Pacific Place” Hong Kong Announced plan to acquire remaining 50% equity interest of Sino-Ocean Taikoo Li Chengdu. The acquisition was Celebrated grand opening of the completed in February 2023 ZHANGYUAN urban regeneration Chengdu project, a Shanghai Jing’an Urban Regeneration Construction Development Co., Ltd-owned NOV property, which the Company jointly Officially launched “Bi-city Youth operates and manages Cultural Leadership Programme” Shanghai in partnership with the Hong Kong Palace Museum Hong Kong Taikoo Place and Pacific Place became first office portfolios in FEB 2023 Hong Kong certified by global digital connectivity benchmark Acquired 40% interest in a WiredScore. Two Taikoo Place and freehold site in Bangkok to Six Pacific Place obtained highest develop luxury condominium WiredScore and SmartScore Bangkok certifications, first in Hong Kong Hong Kong SWIRE PROPERTIES ANNUAL REPORT 2022 11

“ Our vision is to be the leading sustainable development performer in our industry globally by 2030.” – GUY BRADLEY, CHAIRMAN

2022 HIGHLIGHT ACHIEVEMENTS Global Sector Leader (Mixed use sector) Ranked 4th globally, and 1st in Asia in the for 6th consecutive year Real Estate Industry Global Development Sector Ranked 2nd globally in the “Environmental Leader (Mixed Use sector) Dimension” for 3rd consecutive year 2022-2023 No. 1 for 5th consecutive year First listed on the 2023 Bloomberg and “AAA” rating Gender-Equality Index (GEI) Green Building Award 2021 by Hong Kong Green Building Council and the Professional Green S&P Global Sustainability Yearbook 2023 Building Council Top 10% S&P Global ESG Score Pioneer Award in Green Building Leadership Category (Facilities Management) 2023 ASHRAE Technology Award Two Taikoo Place won Grand Award in New Building Category First Place of Commercial Buildings (Projects Under Construction (Existing Building Commissioning) category and/or Design – Commercial) 2022 RICS Awards Hong Kong 2022 Best Annual Reports Awards by the Sustainability Award Hong Kong Management Association 2022 RICS Awards China Sustainability Development Report 2021: Taikoo Li Sanlitun West: Best Environmental, Social and Excellence – “Regeneration Project of Governance Reporting Award (Property the Year” Development & Investment category) Annual Report 2021: Bronze Award (General Category) CIBSE Building Performance Awards 2023 Best Digital Innovation Best Corporate Governance and ESG Awards 2022 by the Hong Kong Institute of CPAs Hong Kong Institute of Human ESG Award – Non-Hang Seng Index Resource Management HR (Large Market Capitalization) Category Excellence Awards 2021/2022 Excellence ESG Award (Organisational Category) 13 SWIRE PROPERTIES ANNUAL REPORT 2022

2022 HIGHLIGHTS SUSTAINABLE DEVELOPMENT (SD) 2030 STRATEGY: 2022 HIGHLIGHTS PLPLPLACESAACESCES PEOPLEPEOPLEPEOPLE PARPPARARTNERSTNERSTNERS PERFORMPERFORMPERFORMANCE ENVIRANCE ENVIRANCE ENVIRONMENTONMENTONMENT PERFORMPERFORMPERFORMANCEANCEANCE ECONOMIC ECONOMIC ECONOMIC Through effective We aim to create an environment where our We aim to continue to develop long-term, mutually placemaking and long-term employees will be healthier, happier and more beneficial relationships with our business partners placekeeping, we aim to productive, to invest in our employees and to and other key parties so as to improve our continue to transform the provide rewarding career paths so as to environmental, social and economic performance. places in which we invest develop a diverse and industry-leading team. so as to create value, whilst Suppliers retaining their character, Talent Management 2025 KPI 2022 Progress supporting communities and 2025 KPI 2022 Progress 25% of products 17% of products and enhancing people’s lives. A 25% increase ~154,000 and services services purchased were 3 Impact Reporting in training hours/ training hours delivered purchased sustainable 1 4 Published our third Places employee/year 24 training hours/ shall be sustainable HK$1,477 million Impact Report for Taikoo Hui employee/year spent on sustainable Guangzhou, “The Creative ( 97%) procurement Transformation of Taikoo Occupational Health and Safety Reduce 5-year rolling Achieved a reduction Hui Guangzhou”, in average of accident of 64% in accident conjunction with South China 2025 KPI 2022 Progress 5 University of Technology. The rate in our Hong Kong rate Report uses our Places Impact Maintain Lost Time Injury Rate (“LTIR”) development projects by Framework for assessing, Non-hotel operations: Non-hotel operations: 50% measuring and reporting on <1.2 0.57 ~100% concrete used in Two Taikoo Place are the environmental, social and Hotel operations: Hotel operations: Platinum-certified under the Construction Industry economic impacts of this <2.0 1.56 Council Green Product Certification development Wellness Diversity & Inclusion Tenants First time inclusion in the 2023 Officially rolled out the Green Performance Taikoo Hui Guangzhou Bloomberg Gender-Equality Pledge (“GPP”) in HK and the Chinese Mainland obtained WELL Platinum Index (“GEI”) to deepen landlord-tenant partnerships on certification, recognising the 2025 KPI 2022 Progress sustainability and ESG development’s positive impacts Maintain a female 40.2% of the 2025 KPI 2022 Progress on human health and wellbeing representation of 50% of tenants in GPP launched with workforce are female 6 40% our office portfolios 52 tenants, which Digital Connectivity no less than sign the Green covered Two Taikoo Place and Six in the workforce 37.9% Pacific Place became the Maintain a gender 38.3% of senior Performance Pledge of tenants in our first buildings in Hong Kong balance in senior management positions to jointly improve office portfolio in to be both WiredScore and management are held by women environmental Hong Kong SmartScore Platinum certified performance Maintain gender pay Gender pay ratio 2 Recognised 76 F&B tenants in Hong Kong and ratio at 1:1 (female to male) : 1:0.92 the Chinese Mainland with Green Kitchen Awards Volunteering The Smart Reusable Cup System at Taikoo Place Our Community Ambassador Programme expanded to 10 F&B tenants, and avoided the disposal of over contributed 16,800 single-use cups since >6,100 volunteer service the programme’s launch hours, supporting 73 activities 1 Compared to the baseline year of 2016. 7 Compared to the 2019 baseline. 2 In 2022, gender pay ratio is calculated based on a non-weighed average methodology. 8 Compared to the 2018 baseline. 3 For wholly-owned investment portfolios. 9 Compared to baseline year 2016-2018. 4 Products that meet specific sustainability criteria such as green certification or accreditation by 10 The 2025 KPIs under Energy have been updated per our approved 1.5°C-aligned SBT. Energy reputable, independent third parties. Use Intensity has been renamed to “Electricity Use Intensity” in 2022 to reflect the use of 5 Using 2015-2019 (5-year average) as baseline. Accidental rate represents the number of electricity for the provision of shared services for and in the common parts of our buildings. reportable accidents per 1,000 contractor workers. It is calculated as the total number of The actual scope of this KPI remains unchanged. reportable accidents multiplied by 1,000 and then divided by average daily number of 11 Hong Kong portfolio and Chinese Mainland portfolio refer to our office and retail portfolios and contractor workers on-site. hotels in Hong Kong and the Chinese Mainland respectively. 6 Measured by occupied lettable floor area (“LFA”) of office portfolios at 100% basis comprising of 12 Joint venture projects and trading properties are excluded. Taikoo Place and Pacific Place in Hong Kong and Taikoo Hui Guangzhou. 13 Disclaimer: www.swireproperties.com/sd/awards/mscidisclaimer.html 14

PLPLAACESCESPEOPLEPEOPLEPPARARTNERSTNERS PERFORMPERFORMANCE ENVIRANCE ENVIRONMENTONMENT PERFORMPERFORMANCEANCE ECONOMIC ECONOMIC We aim to continue to design, construct and manage high quality We aim to deliver sustainable economic performance coupled developments that contribute positively to the communities in with good corporate governance and high ethical standards. which we operate and the environment. Financial Performance Climate Change HK$8,706 million in underlying profit attributable to shareholders Green Financing 2025 KPI 2022 Progress 2025 KPI 2022 Progress Achieve a minimum of ~60% of current bond and Absolute GHG emissions (Scope 1 and Scope 2): 50% of bond and loan loan facilities are from green 25%7 28% facilities from green financing financing 2030 KPI 2022 Progress Corporate Governance Value chain GHG emissions 2025 KPI 2022 Progress (Scope 3 – Downstream Leased Assets): Maintain no less than 30% 31% of our Board positions 8 of female representation on are held by female members 28% per square metre 40% Value chain GHG emissions (Scope 3 – Capital Goods): our Board 9 Disclosure and Communications 25% per square metre 17% Energy Published our fifth set of climate-related financial disclosures as per TCFD recommendations 2025 KPI 2022 Progress SD information is disclosed in accordance with the requirements of 10 Reduction of electricity use intensity major global sustainability benchmarks 11 11 Hong Kong Portfolio Hong Kong Portfolio 20%7 15% 11 11 Chinese Mainland Portfolio Chinese Mainland Portfolio 13%7 9% Resource and Circularity Ranked 4th globally and No. 1 Global Sector Leader – 2025 KPI 2022 Progress in Asia, Member of the World 6th consecutive year Commercial waste diversion rate Index – 6th consecutive year 11 11 Hong Kong Portfolio Hong Kong Portfolio 30% 25% 13 11 11 2022-2023 Chinese Mainland Portfolio Chinese Mainland Portfolio 40% 45% Ranked No. 1 for 5th consecutive year, “AAA” rating “AAA” rating Building/Asset Investment 2025 KPI 2022 Progress 12 100% of wholly-owned 100% of new development 12 new development projects to projects achieved the highest achieve the highest ratings environmental building 93% of wholly-owned existing assessment scheme rating 12 developments achieved the highest ratings 15 SWIRE PROPERTIES ANNUAL REPORT 2022

FINANCIAL HIGHLIGHTS 2022 2021(e) Results Note HK$M HK$M Change For the year Restated Revenue 13,826 16,318 -15% Profit attributable to the Company’s shareholders Underlying (a), (b) 8,706 9,532 -9% Recurring underlying (b) 7,176 7,143 0% Reported 7,980 7,112 +12% Cash generated from operations 6,332 7,028 -10% Net cash (outflow)/inflow before financing (3,243) 1,849 N/A HK$ HK$ Earnings per share Underlying (c), (d) 1.49 1.63 -9% Recurring underlying (c), (d) 1.23 1.22 0% Reported (c), (d) 1.36 1.22 +12% Dividend per share First interim 0.32 0.31 +3% Second interim 0.68 0.64 +6% Financial Position At 31st December HK$M HK$M Total equity (including non-controlling interests) 292,258 293,610 0% Net debt 18,947 10,334 +83% Gearing ratio (a) 6.5% 3.5% +3%pt. HK$ HK$ Equity attributable to the Company’s shareholders per share (a) 49.44 49.85 -1% Notes: (a) Refer to glossary on page 215 for definition. (b) A reconciliation between reported profit and underlying profit attributable to the Company’s shareholders is provided on page 33. (c) Refer to note 14 to the financial statements for the weighted average number of shares. (d) The percentage change is the same as the corresponding percentage change in profit attributable to the Company’s shareholders. (e) Following a change in accounting policy resulting from the agenda decision approved by the IFRS Interpretation Committee on “Lessor Forgiveness of Lease Payments (IFRS 9 and IFRS 16)”, the 2021 comparative figures have been restated. In this connection, revenue for the year ended 31st December 2021 has been increased by HK$427 million while underlying and reported profit has each been reduced by HK$9 million. Reported equity as at 31st December 2021 has been reduced by HK$548 million. Refer to note 1(c) to the financial statements for further details. UNDERLYING HK$M PROFIT/LOSSES BY SEGMENT 10,000 8,706 9,532 8,000 1,530 2,389 Property in et­ent 108 erring erring 6,000 nderying nderying proit proit Property trading 7,176 7,143 4,000 7,409 7,482 Hote 2,000 €i et­ent 0 (341) (45) -2,000 (294) 2022 2021 (etated) 16

TEN-YEAR FINANCIAL SUMMARY 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 HK$M HK$M HK$M HK$M HK$M HK$M HK$M HK$M HK$M HK$M Restated Restated STATEMENT OF PROFIT OR LOSS Revenue Property investment 9,786 10,456 10,857 10,902 11,380 12,254 12,410 12,635 12,981 12,340 Property trading 2,207 3,842 4,463 4,760 5,833 1,061 516 312 2,443 921 Hotels 942 1,089 1,127 1,130 1,345 1,404 1,296 641 894 565 12,935 15,387 16,447 16,792 18,558 14,719 14,222 13,588 16,318 13,826 Profit Attributable to the Company’s Shareholders Property investment 5,426 6,029 6,231 5,938 6,671 8,732 10,061 8,839 8,654 8,025 Property trading 720 1,020 1,089 1,199 1,111 99 (18) (87) 601 171 Hotels (46) 30 (303) (117) (43) (41) (70) (524) (307) (341) Change in fair value of investment properties 6,425 2,437 7,055 8,030 26,218 19,876 3,450 (4,645) (1,836) 125 12,525 9,516 14,072 15,050 33,957 28,666 13,423 3,583 7,112 7,980 Dividends for the year 3,510 3,861 4,154 4,154 4,505 4,914 5,148 5,324 5,558 5,850 Retained profit 9,015 5,655 9,918 10,896 29,452 23,752 8,275 (1,741) 1,554 2,130 STATEMENT OF FINANCIAL POSITION Net Assets Employed Property investment 218,556 226,607 235,917 248,466 283,045 299,659 289,185 282,257 288,246 293,752 Property trading 9,408 8,210 7,452 6,616 3,942 4,143 7,789 7,249 9,637 11,612 Hotels 7,200 7,801 7,928 7,520 7,738 7,394 7,229 7,243 6,061 5,841 235,164 242,618 251,297 262,602 294,725 311,196 304,203 296,749 303,944 311,205 Financed by Equity attributable to the Company’s shareholders 202,350 207,691 216,247 225,369 257,381 279,275 286,927 288,216 291,624 289,211 Non-controlling interests 800 856 1,702 1,856 1,997 2,016 1,984 1,928 1,986 3,047 Net debt 32,014 34,071 33,348 35,377 35,347 29,905 15,292 6,605 10,334 18,947 235,164 242,618 251,297 262,602 294,725 311,196 304,203 296,749 303,944 311,205 HK$ HK$ HK$ HK$ HK$ HK$ HK$ HK$ HK$ HK$ Earnings per share 2.14 1.63 2.41 2.57 5.80 4.90 2.29 0.61 1.22 1.36 Dividends per share 0.60 0.66 0.71 0.71 0.77 0.84 0.88 0.91 0.95 1.00 Equity attributable to shareholders per share 34.59 35.50 36.97 38.52 44.00 47.74 49.05 49.27 49.85 49.44 RATIOS Return on average equity attributable to the Company’s shareholders 6.3% 4.6% 6.6% 6.8% 14.1% 10.7% 4.7% 1.2% 2.5% 2.7% Gearing ratio 15.8% 16.3% 15.3% 15.6% 13.6% 10.6% 5.3% 2.3% 3.5% 6.5% Interest cover – times 10.02 8.96 13.56 15.48 38.81 33.29 28.85 12.93 20.78 48.26 Dividend payout ratio 28.0% 40.6% 29.5% 27.6% 13.3% 17.1% 38.4% 148.6% 78.1% 73.3% UNDERLYING Profit (HK$M) 6,348 7,152 7,078 7,112 7,834 10,148 24,130 12,166 9,532 8,706 Return on average equity attributable to the Company’s shareholders 3.2% 3.5% 3.3% 3.2% 3.2% 3.8% 8.5% 4.2% 3.3% 3.0% Earnings per share (HK$) 1.09 1.22 1.21 1.22 1.34 1.73 4.12 2.08 1.63 1.49 Interest cover – times 6.43 7.58 7.75 8.89 10.68 12.58 48.16 32.10 32.96 74.74 Dividend payout ratio 55.3% 54.0% 58.7% 58.4% 57.5% 48.4% 21.3% 43.8% 58.3% 67.2% Notes: 1. The information for all years is shown in accordance with the Group’s current accounting policies and disclosure practices. Consequently figures for years prior to 2022 may be different from those originally presented. 2. The equity attributable to the Company’s shareholders and the returns by segment for 2022 and 2021 are shown in the Financial Review – Investment Appraisal and Performance Review on page 80. 3. Underlying profit is discussed on pages 33 to 35. 4. Refer to Glossary on page 215 for definitions and ratios. 17 SWIRE PROPERTIES ANNUAL REPORT 2022

TEN-YEAR FINANCIAL SUMMARY REVENUE HK$M 20,000 15,000 Property investment 10,000 Property trading 5,000 Hotels 0 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 (Restated) (Restated) NET ASSETS HK$M EMPLOYED 350,000 300,000 250,000 Property investment 200,000 Property trading 150,000 Hotels 100,000 50,000 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 (Restated) (Restated) DIVIDENDS AND HK$ UNDERLYING 4.5 EARNINGS PER SHARE 4.0 3.5 3.0 2.5 2.0 1.5 Dividends per share 1.0 0.5 Underlying earnings per share 0.0 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 (Restated) (Restated) 18

PROFIT ATTRIBUTABLE HK$M TO THE COMPANY’S 36,000 SHAREHOLDERS 30,000 24,000 Property Hotels 18,000 investment 12,000 Property Cange in air trading vale o investment 6,000 properties 0 otal attritale proit otal nderlying proit -6,000 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022  estated­  estated­ TOTAL EQUITY AND HK$M NET DEBT 350,000 300,000 250,000 200,000 Total equity 150,000 Net debt 100,000 50,000 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 (Restated) (Restated) RETURNS ON % AVERAGE EQUITY 20 15 10 5 Group Group – underlying 0 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 (Restated) (Restated) SWIRE PROPERTIES ANNUAL REPORT 2022 19

CHAIRMAN’S STATEMENT The reopening of Hong Kong and the Chinese Mainland signals the beginning of a new post-pandemic era for our business, and we remain optimistic for a recovery across our key markets, and are ready to capture new opportunities as they arise. Dear shareholders, achievements with our teams, partners and the wider 2022 was a milestone year for our business. We made community. This milestone year was made all the more significant progress with our HK$100 billion investment important as it marked the 25th anniversary of the pipeline, whilst celebrating 50 years of originality and establishment of the Hong Kong Special Administrative creativity since Swire Properties’ inception in 1972. Region. Looking ahead, we are looking forward to pursuing our growth strategy in our home city and in our core We continued to face operational challenges due to the markets in the Chinese Mainland and South East Asia. pandemic, in particular during the first half of the year. However, our financial strength and our commitment to Profits and Sustained Dividend Growth operational excellence ensured that we delivered a Our reported profit attributable to shareholders in 2022 was stable performance across our business. HK$7,980 million, compared with HK$7,112 million in 2021. The full reopening of the border with the Chinese Mainland Underlying profit attributable to shareholders decreased and the relaxation of pandemic control measures is a by HK$826 million from HK$9,532 million in 2021 to welcome development for Hong Kong, as the city returns to HK$8,706 million in 2022, primarily due to the reduction in normalcy. Hong Kong is our home, and we are determined profit from the sale of car parking spaces at our Taikoo to contribute to Hong Kong’s resurgence, and to further Shing residential development in Hong Kong. Our recurring reinforce the city’s unique position as a global financial underlying profit for the year was HK$7,176 million, centre and a super connector to the Greater Bay Area. compared with HK$7,143 million in 2021. In the Chinese Mainland, thanks to the national success of We declared a second interim dividend for 2022 of HK$0.68 our two retail-led brands – Taikoo Li and Taikoo Hui – we per share. This, together with the first interim dividend of have announced several major new investments. As China’s HK$0.32 per share paid in October 2022, amounts to a full economy continues to grow, we will continue to refine our year dividend of HK$1.00 per share, representing a 5% approach to transformational placemaking in all the cities increase over the dividends for 2021. The second interim in which we operate. dividend for 2022 will be paid on Thursday, 4th May 2023 Our 50th anniversary celebrations in 2022 were a timely to shareholders registered at the close of business on the reminder of how far we have come as a company since record date, being Thursday, 6th April 2023. Shares of the our early beginnings with the Taikoo Sugar Refinery and Company will be traded ex-dividend from Monday, Taikoo Dockyard. I was immensely proud to celebrate our 3rd April 2023. 20

Our policy is to deliver sustainable growth in dividends and Under the Hainan Free Trade Port policy, Sanya has rapidly to pay out approximately half of our underlying profit in become one of the most sought-after travel destinations in ordinary dividends over time. the Chinese Mainland. With the launch of our first premium resort-style complex, we will be well-placed to tap into this Close to 40% of HK$100 Billion growing demand. Plan Committed The Greater Bay Area remains a key focus, given its 2022 was a seminal year for the Company’s growth. strategic role in the economic development of the nation. Following the announcement of our HK$100 billion We are continuing to explore opportunities to develop a investment plan, our teams have made tremendous progress commercial landmark in the Julong Wan Area, set within a implementing our plan, with 39% now committed to new location on the riverfront in Liwan district, Guangzhou. and ongoing investments in Hong Kong and across our core We have been actively seeking investment opportunities in markets in the Chinese Mainland and South East Asia. Shenzhen, due to its increasing consumption power as a Under the plan, HK$30 billion has been allocated to our tier-one commercial and technology centre. We see portfolios in Hong Kong to further expand Taikoo Place and opportunities to introduce our Taikoo Hui and Taikoo Li Pacific Place. We are also keen to continue our growth in brands to the market, and were pleased to sign a Strategic the Chinese Mainland, and have earmarked HK$50 billion Framework Cooperation Agreement with the Futian district to double our gross floor area in the region over the next government in July 2022. We intend to develop a retail-led decade, under our recognised Taikoo Li and Taikoo Hui commercial project in Futian, which has highly attractive brands. prospects as the core business area of Shenzhen. Despite the challenges of the pandemic, we were able to We also made exciting headway in 2022 with the announce several significant new projects in the Chinese announcement of a new luxury hotel under The House Mainland in 2022, which testifies to our strong confidence Collective brand, which will be centrally located in the in the Chinese market over the long term. Nanshan district of Shenzhen. This new hotel venture followed closely on the heels of our announcement in July In March 2022, we announced our partnership with Xi’an of a new “House” hotel in Shibuya, Tokyo. Together, these Cheng Huan Cultural Investment and Development Co., Ltd hotel projects form part of our overall development plan for to develop Taikoo Li Xi’an. This mixed-use development is our hotel business, to ramp up the expansion of The House located at the Small Wild Goose Pagoda historical and Collective and EAST Hotel brands across Asia Pacific. We cultural zone in Beilin district, and will mark our seventh have the appetite to continue to invest, but prefer an development and our fourth Taikoo Li in the Chinese asset-light approach, utilising a management-contract Mainland. Hailed as a cradle of Chinese civilisation, we are model to expand into new cities. delighted to have the opportunity to develop a landmark In December 2022, we announced the acquisition of the project in this historical city. We are also excited to remaining 50% interest of Sino-Ocean Taikoo Li Chengdu contribute our placemaking expertise in the urban from our joint venture partner Sino-Ocean group. All three development of Xi’an. phases of the acquisition were completed by February In October 2022, we announced another retail 2023. This industry-leading development has become a top development project in Sanya. This will introduce more destination in the country and a source of local pride, and variety to our Chinese Mainland portfolio, as our first we see this acquisition as an important milestone in our project situated in a tropical locale within the region. regional growth story. 21 SWIRE PROPERTIES ANNUAL REPORT 2022

CHAIRMAN'S STATEMENT Investing in our Commercial Portfolios The Hong Kong retail market continued to be impacted by Our commitment to our home city is as strong as ever. With the pandemic and associated travel restrictions in 2022. approximately one third of our HK$100 billion set aside to The relaxation in COVID-19 travel curbs is an important reinforce our flagship portfolios in Hong Kong, we hope to step forward, and we remain confident in the long-term support the long-term competitiveness of the city as an position of Hong Kong as a global tourism and financial international financial centre. centre. Whilst it will take time for the market to fully recover, we expect to see some stability in the near term, Following the launch of Two Taikoo Place, we are nearing and our strong fundamentals will ensure that we can take completion of the current phase of our Taikoo Place advantage of the anticipated recovery in 2023. redevelopment. This HK$15 billion project has been We remain committed to reinforcing our core assets. In the instrumental in transforming Taikoo Place into a global context of our retail portfolio, we have made good use of business district, which has become the gold standard for the past two years to undertake renovations, and we will well-connected, holistically planned commercial space, continue to focus on expanding and elevating our tenant with diverse amenities and cutting-edge ESG credentials. mix, introducing innovative retail concepts to our malls, With these strong fundamentals, our office portfolio and launching immersive customer engagement initiatives. remains resilient in a weak office market, and we are in a Our loyalty programmes and newly refurbished VIP lounges prime position to benefit from the prevailing flight-to- have been well-received, and we are also exploring quality trend. crossover opportunities between some of our malls in As part of our masterplan for Taikoo Place, we obtained full Hong Kong and the Chinese Mainland to further enhance ownership of the Zung Fu Industrial Building in March 2022. our customer experience. Subject to Swire Properties having successfully bid in the compulsory sale of the adjacent Wah Ha Factory Building, Trading Portfolio and Venturing we intend to redevelop the two sites for office and into New Markets commercial use, which will grow our presence in the district We have allocated HK$20 billion to residential trading, with an additional 779,000 square feet of gross floor area. with an aim to expand in our core market of Hong Kong, In addition, we submitted a compulsory sale application and explore new markets in the Chinese Mainland and for a site on Tong Chong Street in June 2022. Subject to a South East Asia. Our teams have been making excellent successful bid, the development would form part of our progress in building out our trading pipeline. In Hong Kong long-term expansion plans for Taikoo Place. alone, we have three major projects in development. At Pacific Place, we are also making significant progress in We were delighted to win the bid for 269 Queen’s Road the eastward expansion of the office portfolio. Given the East, which will further strengthen and diversify our greater increasing importance of Admiralty with its enhanced Pacific Place portfolio. In addition, the launch of EIGHT mass transit connectivity, we intend to continue growing STAR STREET in 2022 received keen market attention and our commercial presence, with Grade A office space has enjoyed a strong sales performance to date. characterised by strong sustainability credentials, exceptional connectivity and a sense of community. In the Chinese Mainland, we plan to develop a boutique In December 2022, we announced that our new office luxury project in our upcoming Taikoo Li Xi’an development. tower at 46-56 Queen’s Road East has officially been This is an exciting opportunity for our residential brand, and named “Six Pacific Place”. Our office building 28 Hennessy we are keen to explore the regional market for further Road, which lies adjacent to Six Pacific Place, will be opportunities. renamed as “Five Pacific Place”, strengthening our flagship brand as a premium office address. 22

We also remain opportunistic regarding expansion Conclusion opportunities in South East Asia, with the aim of building As we close the final chapter of a very memorable 2022, our presence in four core cities – Singapore, Bangkok, I would like to thank our shareholders, partners, and Jakarta and Ho Chi Minh City. We have been making the wider community for your support over the past steady progress, with two projects currently in sale and five decades. development in Ho Chi Minh City, and a luxury residential project launched for sale in Jakarta. In February 2023, Under our HK$100 billion investment and strategic plan, we were delighted to announce our first investment in we are well-positioned to pursue new opportunities to grow Bangkok, with a 40% acquisition of a rare freehold plot in our business over the next decade. The reopening of Hong the city’s core central business district. We are excited to Kong and the Chinese Mainland signals the beginning of a work with our local partners to develop a unique luxury new post-pandemic era for our business, and we remain residence in the Thai capital. Looking ahead, we will optimistic for a recovery across our key markets, and are continue to seek out prime opportunities for future ready to capture new opportunities as they arise. investment in these markets. I would also like to express my gratitude to the team at A New Era in ESG Leadership Swire Properties for their dedication over the past year in the face of many challenges. Our 50th anniversary was The implementation of our SD 2030 Strategy in 2016 a great year of celebrations with our community, and has seen us advance rapidly to become a sustainability I commend our team for their creativity and passion in leader – ranking number one in Asia, and four in the world hosting such a fantastic calendar of events to mark this amongst our peers under the Dow Jones Sustainability important milestone in our proud history. World Index. I will leave it to Tim to touch on the specifics, but increasing our climate resilience remains of paramount Guy Bradley importance, and we are committed to our ambitious 1.5°C-aligned science-based targets and our transition to Chairman net-zero. As we continue to set the bar higher, the goal Hong Kong, 9th March 2023 becomes harder to achieve; I am grateful to our teams for their support as they continue to push the envelope to advance our SD agenda. I would also like to take this opportunity to thank a group of young people who made an indelible contribution to Swire Properties this year. When we speak of sustainable development, we must think about the next generation of talent. Our 50th anniversary celebrations offered an exceptional opportunity to collaborate with talented young people on a host of special events, including the White Christmas Street Fair and the Hong Kong Palace Museum’s Bi-city Youth Cultural Leadership Programme. We look forward to continuing these partnerships in the years to come, and to offering a platform to empower our youth and nurture their role as future leaders in Hong Kong. 23 SWIRE PROPERTIES ANNUAL REPORT 2022

CHIEF EXECUTIVE’S STATEMENT Overall, we delivered a steady performance in 2022. We have made encouraging progress implementing our ambitious HK$100 billion investment plan to expand our portfolios in core markets in Hong Kong, the Chinese Mainland and South East Asia. Dear shareholders, 2022 Financial Results at a Glance As we move forward into a post-COVID-19 era, we remain Our underlying profit decreased by HK$826 million from focused on investing in our growth and building on the HK$9,532 million in 2021 to HK$8,706 million in 2022, future of our business. While we experienced our share of which mainly reflected the decrease in profit from the sale setbacks in 2022 due to the challenging operating of car parking spaces in Hong Kong. Recurring underlying environment, we were well prepared to respond effectively profit was HK$7,176 million in 2022, compared with to the gradual recovery in the latter half of 2022. HK$7,143 million in 2021. Overall, we delivered a steady performance in 2022. Our recurring underlying profit from property investment We have made encouraging progress implementing our decreased in 2022, due primarily to lower office rental ambitious HK$100 billion investment plan to expand our income from Hong Kong and lower retail rental income portfolios in core markets in Hong Kong, the Chinese from the Chinese Mainland. Mainland and South East Asia. In Hong Kong, we operated in a weaker office market due to 2022 was a special year for Swire Properties as we new supply and economic uncertainty. However, our office celebrated our 50th anniversary with colleagues, portfolio remained resilient with solid occupancy rates. customers, tenants and the wider community through a The retail market in Hong Kong experienced severe diverse and colourful programme of events. Throughout disruption in the early part of the year, due to the fifth the year, our colleagues have demonstrated leadership, COVID-19 wave, related social distancing measures and resilience and creativity, both in their response to the mandatory closures. Despite this challenging start, we saw challenges of the pandemic and to the fantastic events a recovery in footfall and tenants’ sales from the second which have been held all around the world to mark this quarter of 2022 onwards, following the gradual relaxation anniversary milestone. of restrictions and the introduction of the HKSAR The easing of COVID-19 restrictions in Hong Kong and Government’s consumption voucher scheme. Rental the Chinese Mainland marks a key turning point for the concessions were given to tenants for specific periods on economic recovery across our core markets. Undoubtedly a case-by-case basis. Our malls remained almost fully let challenges still lie ahead but we remain confident in our throughout the year. core markets in Hong Kong and the Chinese Mainland. Retail sales in the Chinese Mainland started strongly in We will continue to grow our pipeline of new projects 2022, with a full year contribution from our new Taikoo Li based on our HK$100 billion investment plan, promote Sanlitun West and Taikoo Li Qiantan developments. From leadership in sustainability and accelerate our digital the second quarter, our six shopping malls were affected to transformation strategy. varying degrees by the pandemic and ensuing city-wide closures, particularly in Shanghai and Beijing. As a result, 24

retail sales (excluding Taikoo Li Sanlitun West and Taikoo Li to 35,000 square feet at Two Taikoo Place. Some of the Qiantan) decreased by 20% on an attributable basis. Our committed tenants will relocate from Central, reinforcing office portfolio in the Chinese Mainland proved resilient the current and continuing decentralisation trend and despite COVID-19 related controls in the cities in which Taikoo Place’s rising status as a Global Business District. we operate. A “New Central” is forming around the Admiralty area, Underlying profit from property trading in 2022 reflected and we are well positioned to take advantage of this with the completion of sales of 27 units at our EIGHT STAR our diversified office and retail developments and by STREET residence in Hong Kong and the share of profits reinforcing our greater Pacific Place offering. In 2022 we from sales at The River project in Ho Chi Minh City, announced our newest Grade A office tower, Six Pacific Vietnam. Our hotel business in Hong Kong and the Chinese Place, and the renaming of 28 Hennessy Road as Five Mainland was adversely affected by COVID-19 and its Pacific Place. We also achieved another milestone with our associated travel restrictions. successful bid for a residential site at 269 Queen’s Road East in Wan Chai, a prime location which will support the Our Future Prospects eastward expansion of our greater Pacific Place portfolio. The office market in Hong Kong is expected to remain weak As Hong Kong reconnects to the world and closer financial in 2023, reflecting increased vacancy rates, new supply integration with the Chinese Mainland is realised, we and global economic uncertainty. We also anticipate that expect to see continued improvement in the financial competition from Central and Kowloon East will exert markets. Hong Kong’s strategic role as an international downward pressure on rents. However, our office portfolio financial centre will be strengthened in the long run. remains resilient in a weakened market, due to a well- We remain confident in the long-term prospects for the managed profile and solid occupancy rates. Taikoo Place in Hong Kong office market, and we anticipate an increase in particular, is benefiting from the flight-to-quality, with demand for Grade-A office space, particularly from financial prospective tenants placing a higher value on sustainability institutions and professional services firms in the medium and wellness. term. Under our current masterplan for our core portfolios, Under our HK$100 billion investment plan we are we are well-placed to benefit from a positive shift in market continuing to expand our Taikoo Place and Pacific Place sentiment, as well as current trends shaping the future portfolios, offering unmatched, triple-Grade A office space of work. alongside top-tier amenities, and supported by strong We are very pleased with the relaxation in Hong Kong’s ESG credentials. Amidst strong competition, these are travel policy which will provide a welcome boost to Hong the placemaking attributes which represent the future of Kong’s retail sector in due course. Despite a difficult 2022, the workplace. we anticipate that footfall and retail sales will gradually Our newest office tower, Two Taikoo Place, obtained its improve across our Hong Kong malls in 2023. In the occupation permit in September 2022, and we have been meantime, we will strengthen and refine our trade mix and making good progress with the leasing campaign despite upgrade the amenities in our malls. We will also continue to market conditions, with a pre-leasing commitment of over invest heavily in our loyalty programmes to engage our 56%, demonstrating the resilience of our office portfolio. In growing membership base. addition to Swiss wealth management group Julius Baer, The Chinese Mainland is now a major contributor to our which earlier confirmed that it will take up four floors revenue growth. Under our investment strategy, we aim spanning close to 100,000 square feet, more companies to double our gross floor area in the region over the next have committed to moving into Two Taikoo Place. decade, investing HK$50 billion to grow our retail-led These include Sumitomo Mitsui Banking Corporation, Taikoo Li and Taikoo Hui brands in Tier 1 and emerging Japan’s leading bank, which will lease two floors spanning Tier 1 cities. The reopening of the border will have a 45,000 square feet, and the Accounting and Financial positive impact on our business and we expect to see Reporting Council, which confirmed plans to take up close moderate to strong demand from retailers. 25 SWIRE PROPERTIES ANNUAL REPORT 2022

CHIEF EXECUTIVE'S STATEMENT We are looking to increase the scale of our investments in As we continue to work towards achieving our 1.5°C-aligned the Chinese Mainland. Taikoo Li Xi’an will be our next major science-based targets, it is crucial that we work closely with landmark, alongside our new retail-led project in Sanya. our partners to advance our greater goals. To that end, we We also remain focused on expanding our presence in the introduced our proprietary Green Performance Pledge Greater Bay Area and we have been making encouraging (GPP), which provides our office tenants with the tools and progress in Guangzhou and Shenzhen. technology to enhance their overall ESG performance Our acquisition of the remaining 50% equity interest of within our office portfolios. Sino-Ocean Taikoo Li Chengdu will contribute to our growth Since the launch of the GPP pilot between August 2021 plan, whilst the recent opening of ZHANGYUAN West Zone and December 2022, 52 office tenants – representing in Shanghai, which is jointly operated and managed by Swire 37.9% of occupied lettable floor area from the Company’s Properties and our local government partner, has reinforced Hong Kong office portfolio (over 2.5 million square feet) – Swire Properties’ reputation for urban regeneration, have signed up which is a very encouraging result for our historical preservation and innovative retail concepts. innovative new tenant engagement platform. We have On the residential front, we are making steady headway begun piloting the programme in our Chinese Mainland with the expansion of our property trading portfolio. We portfolio and aim to engage 50% of our tenant base in are keen to build on our premium residential brand, and Hong Kong and the Chinese Mainland by 2025. currently have an ambitious trading pipeline of six projects We are adopting various approaches to transformational under development in Hong Kong and South East Asia, placemaking, including “smart” placemaking, to ensure including our newly announced luxury residential project that we are designing buildings for the future. We have in Bangkok, Thailand, with a residential component also been making a significant and ongoing investment in our being planned for our new Taikoo Li Xi’an development. office portfolio to create best-in-class buildings which can With HK$20 billion designated for strategic investment in deliver a fully integrated user experience and excellent our trading pipeline, we have the appetite to do more. digital connectivity. Our efforts were recognised in 2022 Currently we have teams across the region who are actively with Two Taikoo Place and Six Pacific Place becoming the looking for the right partners and suitable sites for further first buildings in Hong Kong to be WiredScore and investment opportunities. SmartScore certified, both achieving the highest Platinum In 2022 we made the strategic decision to expand our hotel certification level. Taikoo Place and Pacific Place were also business through third-party management agreements. confirmed as the first WiredScore-certified portfolios in We will open two new third party-owned House Collective Hong Kong, reinforcing our status as a leader in designing hotels in two new cities – in Nanshan district in Shenzhen the most innovative and smart buildings in the industry. and Shibuya in Tokyo. This is part of our wider development We will continue to accelerate the process of digital strategy in the Greater Bay Area and highlights The House transformation with a team dedicated to identifying and Collective’s brand recognition as a premium hotel name in promoting the adoption of emerging technologies for our the Asia Pacific region. portfolios. Additionally, New Ventures is responsible for a US$50 million corporate venture capital fund to source and Charting a Sustainable Future invest in emerging technologies globally, ensuring that we We continued to demonstrate leadership in sustainability stay ahead of the curve while gaining valuable insights to in 2022, reaching numerous milestones throughout the accelerate growth. year which were recognised internationally. Swire 50th Anniversary Celebrations in 2022 Properties advanced from 7th to 4th position in the Dow Jones Sustainability World Index 2022, in addition to Our 50th anniversary year gave us the opportunity to retaining the Global Sector Leader title (Mixed-use sector) celebrate with our people, our partners and our in the 2022 Global Real Estate Sustainability Benchmark communities. The anniversary campaign, which was rolled for the sixth consecutive year. out over the year under the tagline “ORIGINAL. ALWAYS.”, paid tribute to the innovative mindset which has shaped the Company’s success over the past five decades. 26

As part of the festivities we launched a range of immersive As part of our anniversary festivities we also invited 50 art and cultural experiences for our local communities, students and alumni from the SPPA to participate in the featuring partnerships with renowned international and “50A Urban Furniture Project”, where they underwent a local artists. This included the continuation of our 10-year series of masterclasses to create a state-of-the-art piece collaboration with Art Basel Hong Kong and the inaugural of urban furniture. The project resulted in three exceptional Asian tour of the critically-acclaimed exhibition “Bags: designs which will all be showcased at our headquarters in Inside Out” with the Victoria & Albert Museum, across our Taikoo Place later this year. retail portfolios in Hong Kong and the Chinese Mainland. Throughout 2022, our Community Ambassador Programme In the spirit of innovation, we also collaborated with a continued to provide widespread support to our local selection of ten artists to create the exclusive 50th communities. The programme’s signature initiative, Anniversary Art NFT Collection, which was made available “BOOKS FOR LOVE @ HK$10”, marked its own 10th as free art drops. anniversary by raising over HK$1 million for charity through This unique approach also saw us commission a botanical its book sales, achieving a record high. The remarkable art series in Taikoo Place, named “Seasons in Continuum”. efforts of our volunteers, which comprise our employees These stunning floral installations told our story over and their families and friends, were also recognised at the the past five decades, whilst highlighting our ethos of inaugural Hong Kong Volunteer Awards. Jointly organised improving public spaces and making art accessible to all. by the Home & Youth Affairs Bureau and the Agency for One of the defining features of our success over the years Volunteer Service, our Community Ambassadors were has been the close ties we have built with our local honoured to receive the Outstanding Volunteer Group communities. As a developer deeply rooted in Hong Kong, Award for their invaluable contributions to Hong Kong. we know that the younger generation is the key to the Conclusion city’s future. Over the years Swire Properties has launched numerous programmes to provide opportunities for young In 2022, we were proud to celebrate 50 years of successful people to learn from the best in our industry, and to give placemaking and to recognise important partnerships with them a platform to showcase their talents in the areas of key stakeholders all around the world. Working together, entrepreneurship and innovation. we are looking forward to implementing our ambitious In November, we were proud to be the Lead Sponsor for the investment strategy which will shape the Company’s “Bi-city Youth Cultural Leadership Programme”, led by The progress over the next decade. Hong Kong Palace Museum. The Programme aims to inspire We remain fully committed to the future of Hong Kong. We young people and to develop them into the next generation will continue to invest in the development of our portfolios of cultural leaders in Beijing and Hong Kong. In the first year to contribute to Hong Kong’s growth and competitiveness of the programme, our senior management team shared as a global financial hub, whilst scaling up our investments their expertise in the areas of transformational placemaking in the Chinese Mainland and establishing a long-term and arts and culture. We are planning for the second year presence in South East Asia. of the programme and intend to offer students experiential I would like to express my appreciation to our shareholders, learning opportunities across our property portfolios. our partners and the exceptionally talented team at One of our most enduring youth empowerment initiatives Swire Properties for your support over the past year and has been the Swire Properties Placemaking Academy in the future. (SPPA), now in its fourth year. Our 2022 cohort took the lead in designing the anniversary edition of our White Tim Blackburn Christmas Street Fair, receiving guidance, mentorship and resources within and from outside the Company to create Chief Executive a sustainable and innovative festive celebration for the Hong Kong, 9th March 2023 wider community to enjoy. 27 SWIRE PROPERTIES ANNUAL REPORT 2022

KEY BUSINESS STRATEGIES As a leading developer, owner and operator of mixed-use, principally commercial, properties in Hong Kong and the Chinese Mainland, our strategic objective is sustainable growth in shareholder value in the long term. To achieve this objective, we employ five strategies. 1. Create long-term value by conceiving, with a view to the long term, to maintain consistently designing, developing, owning and high levels of service and to enhance and reinforce our managing transformational mixed-use assets. By doing so, we believe that we will maximise and other projects in urban areas the occupancy and earnings potential of our properties. We will continue to design projects which we believe Tenants increasingly scrutinise the sustainable will have the necessary scale, mix of uses and transport development credentials of landlords and buildings. links to become key commercial destinations and to We aim to be at the forefront of sustainable transform the areas in which they are situated. development by designing energy efficient buildings through the innovative use of design, materials and 2. Maximise the earnings and value of our new technology, and by engagement with tenants and completed properties through active others with whom we do business. asset management and by reinforcing 3. Develop luxury and high quality our assets through enhancement, residential property activities redevelopment and new additions We manage our completed properties actively We will look to acquire appropriate sites for (including by optimising the mix of retail tenants and development of luxury and high quality residential early renewal negotiations with office tenants) and projects for trading and investment in the markets in which we operate. 28

4. Focus principally on Hong Kong and the While we will continue to concentrate on Hong Kong Chinese Mainland and the Chinese Mainland, we intend to expand selectively in South East Asia. In Hong Kong, we will continue to focus on reinforcing our existing investment property assets and on seeking 5. Manage our capital base conservatively new sites suitable for transformative developments We intend to maintain a strong balance sheet with a and for residential projects. view to investing in and financing our projects in a We aim to replicate in the Chinese Mainland our disciplined and targeted manner. success in Hong Kong. We intend to take a measured We aim to maintain exposure to a range of debt approach to land purchases in the Chinese Mainland maturities and a range of debt types and lenders. Our and will focus on developments where we can secure current debt profile reflects a mix of revolving and term sites through early engagement with local bank loans and medium term notes. governments who recognise our strengths in developing large-scale mixed-use projects. In implementing the above strategies, the principal risks We will seek residential development opportunities in and uncertainties facing the Group are that the economies the Chinese Mainland. These are likely to be ancillary in which it operates (in particular Hong Kong and the to our mixed-use developments. However, in the right Chinese Mainland) will not perform as well in the future as locations and cities we may also consider standalone they have in the past and the uncertainties as to whether residential development opportunities. Our residential this will happen. developments will be aimed at buyers of luxury and high quality properties, where we believe we have a competitive advantage. 29 SWIRE PROPERTIES ANNUAL REPORT 2022

Taikoo Li Qiantan, Shanghai

Management Discussion & Analysis

REVIEW OF OPERATIONS 2022 2021(2) HK$M HK$M Restated Revenue Gross Rental Income derived from Offices 6,003 6,214 Retail 5,849 6,191 Residential 374 474 Other Revenue (1) 114 102 Property Investment 12,340 12,981 Property Trading 921 2,443 Hotels 565 894 Total Revenue 13,826 16,318 Operating Profit/(Losses) derived from Property investment From operations 7,702 8,278 Sale of interests in investment properties 571 1,185 Valuation gains/(losses) on investment properties 801 (1,947) Property trading 209 492 Hotels (259) (174) Total Operating Profit 9,024 7,834 Share of Post-tax Profit from Joint Venture and Associated Companies 1,455 1,786 Profit Attributable to the Company’s Shareholders 7,980 7,112 (1) Other revenue is mainly estate management fees. (2) Following a change in accounting policy resulting from the agenda decision approved by the IFRS Interpretation Committee on “Lessor Forgiveness of Lease Payments (IFRS 9 and IFRS 16)”, the 2021 comparative figures have been restated. Refer to note 1(c) to the financial statements for further details. Additional information is provided in the following section to reconcile reported and underlying profit attributable to the Company’s shareholders. These reconciling items principally adjust for the net valuation movements on investment properties and the associated deferred tax in the Chinese Mainland and the U.S.A., and for other deferred tax provisions in relation to investment properties. In the Chinese Mainland and the U.S.A., the Group’s investment properties recorded net property valuation gains of HK$2,503 million and HK$389 million respectively in 2022. In Hong Kong, investment properties recorded net property valuation losses of HK$1,166 million. There is a further adjustment to remove the effect of the movement in the fair value of the liability in respect of a put option in favour of the owner of a non-controlling interest. Amortisation of right-of-use assets classified as investment properties is charged to underlying profit. 32

2022 2021 Note HK$M HK$M Underlying Profit Reconciliation Restated Profit Attributable to the Company’s Shareholders per Financial Statements 7,980 7,112 Adjustments in respect of investment properties: Valuation (gains)/losses in respect of investment properties (a) (1,726) 708 Deferred tax on investment properties (b) 1,402 1,027 Valuation gains realised on sale of interests in investment properties (c) 915 585 Depreciation of investment properties occupied by the Group (d) 22 23 Non-controlling interests’ share of valuation movements less deferred tax 144 59 Movement in the fair value of the liability in respect of a put option in favour of the owner of a non-controlling interest (e) 49 49 Impairment loss on a hotel held as part of a mixed-use development (f) – 22 Less amortisation of right-of-use assets reported under investment properties (g) (80) (53) Underlying Profit Attributable to the Company’s Shareholders 8,706 9,532 Profit from divestment (1,530) (2,389) Recurring Underlying Profit Attributable to the Company’s Shareholders 7,176 7,143 Notes: (a) This represents the net valuation movements as shown in the Group’s consolidated statement of profit or loss and the Group’s share of net valuation movements of joint venture companies. (b) This represents deferred tax movements on the Group’s investment properties, plus the Group’s share of deferred tax movements on investment properties held by joint venture companies. These comprise deferred tax on valuation movements on investment properties in the Chinese Mainland and the U.S.A., and deferred tax provisions made in respect of investment properties held for the long-term where it is considered that the liability will not reverse for some considerable time. It also includes certain tax adjustments arising from transfers of investment properties within the Group. (c) Prior to the implementation of HKAS 40, changes in the fair value of investment properties were recorded in the revaluation reserve rather than the consolidated statement of profit or loss. On sale, the valuation gains/(losses) were transferred from the revaluation reserve to the consolidated statement of profit or loss. (d) Prior to the implementation of HKAS 40, no depreciation was charged on investment properties occupied by the Group. (e) The value of the put option in favour of the owner of a non-controlling interest is calculated principally by reference to the estimated fair value of the portion of the underlying investment property in which the owner of the non-controlling interest is interested. (f) Under HKAS 40, hotel properties are stated in the accounts at cost less accumulated depreciation and any provision for impairment losses, rather than at fair value. If HKAS 40 did not apply, wholly-owned and joint venture hotel properties held for the long term as part of mixed-use property developments would be accounted for as investment properties. Accordingly, any increase or decrease in their values would be recorded in the revaluation reserve rather than in the consolidated statement of profit or loss. (g) HKFRS 16 amends the definition of investment property under HKAS 40 to include properties held by lessees as right-of-use assets to earn rentals or for capital appreciation or both, and requires the Group to account for such right-of-use assets at their fair value. The amortisation of such right-of-use assets is charged to underlying profit. 33 SWIRE PROPERTIES ANNUAL REPORT 2022

MANAGEMENT DISCUSSION & ANALYSIS | REVIEW OF OPERATIONS Underlying Profit MOVEMENT IN HK$M UNDERLYING PROFIT 10,000 9,532 -859 -73 +153 -47 8,706 8,000 Underlying profit nrease in profit 6,000 in 2021 (Restated) fro property trading 4,000 Derease in profit nrease in losses fro diestent fro otels 2,000 Derease in profit Underlying profit fro property in 2022 inestent 0 2022 2021 Our reported profit attributable to shareholders in 2022 was portfolio was generally resilient, with solid occupancy. HK$7,980 million, compared to a profit of HK$7,112 million The retail portfolio was adversely affected by COVID-19 in in 2021. the early part of the year. Footfall and tenants’ sales Underlying profit attributable to shareholders (which gradually recovered from the second quarter of 2022, as principally adjusts for changes in valuation of investment COVID-19 related social distancing measures were properties) decreased by HK$826 million from HK$9,532 adjusted. The HKSAR Government’s consumption voucher million in 2021 to HK$8,706 million in 2022. The decrease scheme also helped. mainly reflected the reduction in profit from the sale of car In the Chinese Mainland, the six shopping malls were parking spaces in Hong Kong. affected to varying degrees by COVID-19 and related Recurring underlying profit (which excludes the profit from measures from the second quarter of 2022. divestments) was HK$7,176 million in 2022, compared with In the U.S.A., retail sales and gross rental income were solid. HK$7,143 million in 2021. The underlying profit from property trading in 2022 mainly Recurring underlying profit from property investment reflected the completion of sales of 27 units at EIGHT STAR decreased in 2022. This mainly reflected lower office rental STREET in Hong Kong and the share of profits from sales at income from Hong Kong and lower retail rental income The River project in Vietnam. from the Chinese Mainland. The hotel businesses in Hong Kong and the Chinese In Hong Kong, despite a weak office market due to the Mainland were adversely affected by COVID-19 associated economic uncertainty and increased supply, the office travel restrictions. The hotels in the U.S.A. performed better. VALUATION OF HK$M INVESTMENT 300,000 PROPERTIES 250,000 200,000 150,000 Completed 100,000 Under development 50,000 0 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 34

GROSS RENTAL INCOME HK$M AFTER DEDUCTION OF 14,000 RENTAL CONCESSIONS 12,000 10,000 Hong Kong Chinese 8,000 office Mainland 6,000 Hong Kong U.S.A. and retail elsehere 4,000 Hong Kong 2,000 residential 0 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 estated estated UNDERLYING HK$M OPERATING PROFIT 27,000 24,000 21,000 18,000 15,000 12,000 Property Hotes 9,000 investment 6,000 3,000 Property ivestment 0 tradin -3,000 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 estated estated ATTRIBUTABLE GFA COMPLETED INVESTMENT (000 sq. ft.) PROPERTY AND HOTEL 35,000 PORTFOLIO BY LOCATION 30,000 25,000 Hong Kong 20,000 15,000 Chinese Mainland 10,000 U..A. 5,000 0 2022 2023 2024 2025 2026 2027 2028 2029 and later SWIRE PROPERTIES ANNUAL REPORT 2022 35

MANAGEMENT DISCUSSION & ANALYSIS | REVIEW OF OPERATIONS ATTRIBUTABLE GFA COMPLETED INVESTMENT (000 sq. ft.) PROPERTY AND HOTEL 35,000 PORTFOLIO BY TYPE 30,000 25,000 20,000 15,000 Office Hotels/Residential/ Sericed aartents 10,000 Retail nder lannin 5,000 0 2022 2023 2024 2025 2026 2027 2028 2029 and later HK$100 BILLION Commitment for new projects INVESTMENT PLAN 39% COMMITTED Hong Kong investment properties Chinese Mainland investment properties Committed Residential trading projects Remaining target (including in South East Asia) 0 10 20 30 40 50 Target (HK$ Bn) In March 2022, the Company announced a plan to invest development in Sanya, office and other commercial use HK$100 billion over ten years in development projects in developments at 8 Shipyard Lane and at 1067 King’s Road Hong Kong and the Chinese Mainland and in residential in Hong Kong, the acquisition of the remaining 50% trading projects (including in South East Asia). The target interests in Sino-Ocean Taikoo Li Chengdu and the allocation is HK$30 billion to Hong Kong, HK$50 billion to acquisition of a 40% interest in a residential development the Chinese Mainland and HK$20 billion to residential in Bangkok. Uncommitted projects include further retail-led trading projects (including in South East Asia). At 7th mixed-use projects in Tier 1 and emerging Tier 1 cities in March 2023 approximately HK$39 billion of the planned the Chinese Mainland (with a letter of intent and a investments had been committed (HK$17 billion to the framework agreement having been signed in relation to Chinese Mainland, HK$11 billion to Hong Kong and HK$11 projects in Guangzhou and Beijing and a plan to double billion to residential trading projects). Major committed gross floor area in the Chinese Mainland), further projects are a retail-led mixed-use development in Xi’an, expansion at Pacific Place and Taikoo Place in Hong Kong residential developments at Chai Wan Inland Lot No. 178 and further residential trading projects in Hong Kong, the and at 269 Queen’s Road East in Hong Kong, a retail-led Chinese Mainland and South East Asia. 36

Key Developments Complex. The project is expected to open in phases from In January 2022, the sale of the property located at Fort late 2024. Lauderdale, Florida was completed. In November 2022, the first phase of the ZHANGYUAN In March 2022, a consortium in which the Group has a urban regeneration project officially opened in Shanghai. 70% interest acquired (via a government land tender) The project is operated and managed by a joint venture the land use rights in respect of land in the Small Wild between the Group and Shanghai Jing’an Real Estate Goose Pagoda historical and cultural zone in the Beilin (Group) Co., Ltd. district of Xi’an for a consideration of approximately In December 2022, the sale of the property at 8-12 Tsing RMB2,575 million. The land is expected to be developed Tim Street in Tsing Yi, Hong Kong was completed. into a retail-led mixed-use development comprising In December 2022, the Group entered into three retail and cultural facilities, a hotel, serviced residences conditional agreements with the Sino-Ocean group to and business apartments. acquire further interests in Sino-Ocean Taikoo Li Chengdu. In March 2022, the Group obtained full ownership of Under the first agreement (which was completed in Zung Fu Industrial Building in Quarry Bay, Hong Kong. December 2022), the Group’s interest in Sino-Ocean Taikoo Subject to the Group having successfully bid in the Li Chengdu increased from 50% to 65%. Under the second compulsory sale of the adjacent Wah Ha Factory agreement (which was completed in February 2023), the Building, the two sites are intended to be redeveloped Group’s interest in the property management of Sino- for office and other commercial uses. Ocean Taikoo Li Chengdu increased to 100%. Under the In March 2022, the Group acquired an additional 6.67% third agreement (which was completed in February 2023), interest in the Citygate development in Tung Chung, the Group’s interest in the investment properties of Sino- Hong Kong. As a result, the Group’s interest in the Ocean Taikoo Li Chengdu increased to 100%. The Citygate development increased from 20% to 26.67%. consideration was RMB1,000 million under the first agreement, RMB59 million under the second agreement In June 2022, the Group acquired (via a government and RMB4,491 million under the third agreement. land tender) a plot of land at 269 Queen’s Road East in In February 2023, the Group acquired a 40% interest in a Wan Chai, Hong Kong for a consideration of site located in Lumphini sub-district in Pathum Wan district, approximately HK$1,962 million. The plot of land will be Bangkok for a consideration of approximately THB2.4 developed primarily for residential use with an billion. In partnership with City Realty Co. Ltd., the site is aggregate gross floor area (“GFA”) of approximately expected to be developed for residential purposes with a 116,000 square feet. Works preparatory to demolition site area of approximately 136,000 square feet. of the existing building have commenced. The development is expected to be completed in 2025. Portfolio Overview In July and August 2022, Swire Hotels announced plans The aggregate gross floor area (“GFA”) attributable to for two new, third-party owned hotels under The House the Group at 31st December 2022 was approximately Collective brand, in Tokyo and Shenzhen. The two 33.6 million square feet. hotels will be managed by Swire Hotels. In September 2022, the Group obtained the occupation Of the aggregate GFA attributable to the Group, permit for Two Taikoo Place. Two Taikoo Place, the approximately 29.9 million square feet are investment second phase of the Taikoo Place redevelopment, is an properties and hotels, comprising completed investment office tower with an aggregate GFA of approximately properties and hotels of approximately 24.1 million square one million square feet. Leased floors have been feet and investment properties under development or held handed over to tenants in phases. for future development of approximately 5.8 million square feet. In Hong Kong, the investment property and hotel In October 2022, a consortium in which the Group has a portfolio comprise approximately 13.7 million square feet 50% interest acquired (via a government land tender) attributable to the Group of primarily Grade-A office and the land use rights in respect of land in the Haitang retail premises, hotels, serviced apartments and other district of Sanya for a consideration of RMB1,308 luxury residential accommodation. In the Chinese million. The land is expected to be developed into a Mainland, the Group has interests in eight major premium, resort-style, retail-led development which will commercial developments in prime locations in Beijing, be Phase III of the Sanya International Duty-Free Guangzhou, Chengdu, Shanghai, Xi’an and Sanya. These 37 SWIRE PROPERTIES ANNUAL REPORT 2022

MANAGEMENT DISCUSSION & ANALYSIS | REVIEW OF OPERATIONS developments are expected to comprise approximately 14.1 million square feet of attributable GFA when they are all completed. Of this, 10.0 million square feet has already been completed. Outside Hong Kong and the Chinese Mainland, the investment property portfolio comprises the Brickell City Centre development in Miami, U.S.A. The tables below illustrate the GFA (or expected GFA) attributable to the Group of the investment property and hotel portfolio at 31st December 2022. Completed Investment Properties and Hotels (GFA attributable to the Group in million square feet) Residential/ Serviced Under Office Retail Hotels(1) Apartments Planning Total Hong Kong 9.5 2.6 0.8 0.6 – 13.5 Chinese Mainland 2.9 5.7 1.2 0.2 – 10.0 U.S.A. – 0.3 0.3 – – 0.6 Total 12.4 8.6 2.3 0.8 – 24.1 Investment Properties and Hotels Under Development or Held for Future Development (expected GFA attributable to the Group in million square feet) Residential/ Serviced Under Office Retail Hotels(1) Apartments Planning Total Hong Kong 0.2 – – – – 0.2 Chinese Mainland – 1.1 – – 3.0 4.1 U.S.A. – – – – 1.5(2) 1.5 Total 0.2 1.1 – – 4.5 5.8 Total Investment Properties and Hotels (GFA (or expected GFA) attributable to the Group in million square feet) Residential/ Serviced Under Office Retail Hotels(1) Apartments Planning Total Total 12.6 9.7 2.3 0.8 4.5 29.9 (1) Hotels are accounted for in the financial statements under property, plant and equipment and, where applicable, the leasehold land portion is accounted for under right-of-use assets. (2) This property is accounted for under properties held for development in the financial statements. The trading portfolio comprises completed units available for sale at EIGHT STAR STREET in Hong Kong and The River in Vietnam. There are six residential projects under planning or development, three in Hong Kong, one in Indonesia, one in Vietnam and one in Thailand. There are also land banks in Miami, U.S.A. The table below illustrates the GFA (or expected GFA) attributable to the Group of the trading property portfolio at 31st December 2022. Trading Properties (GFA (or expected GFA) attributable to the Group in million square feet) Under Development Completed or Held for Development(1) Development Total Hong Kong 0.0 0.8 0.8 U.S.A. and elsewhere 0.1 2.8 2.9 Total 0.1 3.6 3.7 (1) Completed development in Hong Kong comprises EIGHT STAR STREET. 38

The charts below show the analysis of the Group’s completed investment properties GFA (excluding hotels), gross rental income and net assets employed by region on an attributable basis. COMPLETED INVESTMENT 2% 2% PROPERTIES GFA EXCL. HOTELS Hong Kong 40% 58% 41% 57% Chinese Mainland U.S.A. 31st December 2022 31st December 2021 ATTRIBUTABLE GROSS 2% 3% RENTAL INCOME 37% 37% Hong Kong 61% 60% Chinese Mainland U.S.A. Year ended 31st December 2022 Year ended 31st December 2021 (Restated) NET ASSETS EMPLOYED 2% 2% 19% 18% Hong Kong 79% 80% Chinese Mainland U.S.A. and elsewhere 31st December 2022 31st December 2021 (Restated) SWIRE PROPERTIES ANNUAL REPORT 2022 39

MANAGEMENT DISCUSSION & ANALYSIS | REVIEW OF OPERATIONS Investment Properties – Hong Kong Offices Overview The completed office portfolio in Hong Kong comprises an aggregate of 10.0 million square feet of space on a 100% basis. Total attributable gross rental income from our office properties in Hong Kong was HK$5,932 million in 2022. At 31st December 2022, our office properties, completed and under development, in Hong Kong were valued at HK$180,180 million. Of this amount, the Company’s attributable interest was HK$170,513 million. Hong Kong Office Portfolio GFA (sq. ft.) Occupancy Attributable (100% Basis) (at 31st December 2022) Interest Pacific Place 2,186,433 97% 100% Taikoo Place – One Island East and One Taikoo Place 2,550,379 97% 100% Taikoo Place – Two Taikoo Place (1) 994,545 53% 100% (2) Taikoo Place – Other Office Towers 3,136,717 95% 50%/100% Others (3), (4) 1,158,595 86% 26.67%/50%/100% Total 10,026,669 (1) Including space allocated to tenants who have signed letter of intent. (2) Including PCCW Tower, of which the Group owns 50%. (3) Others comprise One Citygate (26.67% owned), Berkshire House (50% owned), SPACES.8QRE (wholly-owned), 28 Hennessy Road (wholly-owned and will be renamed as Five Pacific Place) and South Island Place (50% owned). (4) In March 2022, the Group acquired an additional 6.67% interest in the Citygate development. The Group’s interest in One Citygate increased from 20% to 26.67% after the transaction. Gross rental income (after deduction of rental concessions of HK$34 million) from the Hong Kong office portfolio in 2022 was HK$5,595 million, 3% lower than in 2021. The office market was weak. Demand was subdued, reflecting increased supply and economic uncertainty. But our office portfolio was generally resilient. We believe that tenants value our provision of amenities and our commitment to sustainability and to the wellbeing of the people who occupy its offices. At 31st December 2022, the office portfolio was 91% let. Excluding Two Taikoo Place (which was completed in September 2022), the office portfolio was 96% let. The chart below shows the mix of tenants of the office properties by the principal nature of their businesses (based on internal classifications) as a percentage of the office area at 31st December 2022. OFFICE AREA BY TENANTS’ BUSINESSES (At ­st €ecemer ‚ƒ‚‚ 9.9% 0.9% 7.6% 31.0% Banking/Finance/ Professional services eal estate/Construction/ Securities/Investment (Accounting/Legal/ Propert development/ Management consulting/ Arcitecture 8.7% Trading Corporate secretarial Advertising and Insurance pulic relations 9.1% Tecnolog/ ters Media/Telecoms 17.6% 15.2% At 31st December 2022, the top ten office tenants (based on attributable gross rental income in the twelve months ended 31st December 2022) together occupied approximately 21% of the Group’s total attributable office area in Hong Kong. 40

One Pacific Place HONG KONG Pacific Place At Two Taikoo Place, tenants have committed (including The performance of the offices at One, Two, and Three by way of letters of intent) to take 53% of the space at Pacific Place was resilient in 2022. These offices were 97% 31st December 2022. Occupation permit was obtained in let at 31st December 2022. Royal Bank of Canada, Eight September 2022. Leased floors have been handed over to Roads Capital, Northern Light Venture Capital, Derivatives tenants in phases. Amundi, BASF, Boston Consulting Group, China, Cornell Capital and CIFI Holdings became tenants. China CITIC Bank International and Julius Baer became PAG and Sequoia Capital leased more spaces. FIL Asia, Bain tenants. Capital, Moelis & Co., Matthews Global, Sequoia Capital, There are six other office towers at Taikoo Place (including Anchor Equity, Shenwan Hongyuan, Agile Property, China PCCW Tower, in which we have a 50% interest). These Baofeng, Aplus Partners, China Harmony, JIC(HK) and W2 offices were 95% let at 31st December 2022. GROW Capital Group renewed their leases. OCI International, Investment Group, Kyndryl, ListcoPRO, OnTheList, The Ganglong China Property and Resona Bank relocated Asset, The Hong Kong Securities and Investment Institute, within the same portfolio. and ZJLD became tenants. FWD, Gravitas Recruitment Taikoo Place Group, IPG and LVMH leased more space. ACCA, Allegis The performance of One Taikoo Place and One Island East Group, Bayer, Beiersdorf, BNP Paribas, Bryan Cave Leighton at Taikoo Place was resilient. These two offices were 100% Paisner, Burberry, Chung Shek Enterprises, CITIC Telecom and 96% let respectively at 31st December 2022. In One CPC, CJ ENM, FTI Consulting, Galderma, Gartner, Gianni & Island East, Huaxin Mining Investment and Squire Patton Origoni, Grobest, Horspath, IBM, Informatica Software, Boggs became tenants. CHANEL leased more space. Jones Lang Lasalle Management Service, LyondellBasell, Accenture, Allied World, Amgen, CMS Hasche Sigle, Hong Magnum Research, Marine Contracting Services, Mighty Kong LLP, La Prairie, SK Hynix, SWIFT and Transamerica Life Ocean, Qantas Airways, QBE, Schindler Lifts, SinoEnergy Bermuda renewed their leases. Capital, Sumida Electric, Swire Coca-Cola, TotalEnergies and Worms Asia renewed their leases. 41 SWIRE PROPERTIES ANNUAL REPORT 2022

MANAGEMENT DISCUSSION & ANALYSIS | REVIEW OF OPERATIONS South Island Place occupants. Following the reopening of the border with the The offices were 87% let at 31st December 2022. Tenants Chinese Mainland and assuming continued improvements include KPMG, Fleet Management Limited, the in the financial markets, the demand for Grade-A office Competition Commission and SCMP. The Group has a 50% space in Hong Kong, particularly from financial institutions interest in the development. and professional services companies, should increase. Hong Kong Office Market Outlook The following chart shows the percentage of attributable The office market in Hong Kong is expected to be weak in gross rental income from the office properties in Hong 2023, reflecting increased vacancy rates, new supply and Kong, for the month ended 31st December 2022, derived economic uncertainty. Increasing competition from Central from leases expiring in the periods with no committed and Kowloon East will exert downward pressure on rents. renewals or new lettings. Tenancies accounting for A flight-to-quality is expected to benefit the Group as approximately 13.8% of the attributable gross rental prospective tenants upgrade their premises and place a income in the month of December 2022 are due to expire in higher value on sustainability and the wellbeing of 2023, with tenancies accounting for a further 16.3% of such rental income due to expire in 2024. OFFICE LEASE EXPIRY PROFILE 70% (At 31st December 2022) 60% 50% 40% 30% 20% 10% 0 2023 2024 2025 and later Retail Overview The completed retail portfolio in Hong Kong comprises an aggregate of 3.2 million square feet of space on a 100% basis. Total attributable gross rental income from our retail properties in Hong Kong was HK$2,320 million in 2022. At 31st December 2022, our retail properties in Hong Kong were valued at HK$54,518 million. Of this amount, the Group’s attributable interest was HK$45,649 million. 42

The portfolio principally consists of The Mall at Pacific Place, Cityplaza at Taikoo Shing and Citygate Outlets at Tung Chung. The Mall at Pacific Place and Cityplaza are wholly-owned by the Group. During the year, the Group increased its interest in the Citygate development (comprising Citygate Outlets) from 20% to 26.67%. The malls are managed by the Group. Hong Kong Retail Portfolio GFA (sq. ft.) Occupancy Attributable (100% Basis) (at 31st December 2022) Interest The Mall, Pacific Place 711,182 96% 100% Cityplaza 1,096,898 100% 100% Citygate Outlets (1) 803,582 100% 26.67% (1), (2) Others 549,558 100% 26.67%/60%/100% Total 3,161,220 (1) In March 2022, the Group acquired an additional 6.67% interest in the Citygate development. The Group’s interest in Citygate Outlets and Tung Chung Crescent neighbourhood shops increased from 20% to 26.67% after the transaction. (2) Others largely comprise Taikoo Shing neighbourhood shops and StarCrest retail premises (which are wholly-owned), Island Place retail premises (60% owned) and Tung Chung Crescent neighbourhood shops. Gross rental income (after deduction of rental concessions Government’s consumption voucher scheme also helped. of HK$171 million) from the retail portfolio in Hong Kong Retail sales in 2022 increased by 2% at The Mall, Pacific was HK$2,169 million in 2022, a 1% increase from 2021. Place and by 4% at Citygate Outlets, and decreased by 5% Rental concessions were given to tenants for specific at Cityplaza. Retail sales in Hong Kong as a whole periods on a case-by-case basis. Cash rental concessions decreased by 1% in 2022. were less in 2022 than in 2021. COVID-19 related social The malls were almost fully let throughout the year. distancing measures disrupted the retail market during the first quarter of 2022. The market recovered gradually from The chart below shows the mix of the tenants of the retail the second quarter, as social distancing measures and properties by the principal nature of their businesses quarantine requirements were adjusted. The HKSAR (based on internal classifications) as a percentage of the retail area at 31st December 2022. RETAIL AREA BY TENANTS’ BUSINESSES (At st December  24.3% 28.8% Fashion and Department Jewellery accessories stores and watches Food and Cinemas Ice rink 0.9% beverages 2.8% 3.7% Supermarkets Others 4.2% 20.2% 15.1% SWIRE PROPERTIES ANNUAL REPORT 2022 43

MANAGEMENT DISCUSSION & ANALYSIS | REVIEW OF OPERATIONS Cityplaza HONG KONG At 31st December 2022, the top ten retail tenants (based Cityplaza on attributable gross rental income in the twelve months Cityplaza is the largest shopping mall on Hong Kong Island, ended 31st December 2022) together occupied with a total floor area of approximately 1.1 million square approximately 25% of the Group’s total attributable retail feet. The six-level mall has more than 170 shops and area in Hong Kong. restaurants, a cinema, an indoor ice rink and over 800 indoor parking spaces. Continued improvements to the The Mall at Pacific Place tenant mix, promotions and activities in the mall make it an The Mall at Pacific Place is in the mixed-use Pacific Place attractive place to shop, eat and be entertained. development. The offices and the four hotels at Pacific Despite the competitive environment, Cityplaza was fully Place provide a flow of shoppers for The Mall. let in 2022. New tenants were introduced including The Mall was almost fully let during the year. Despite American Eagle / Aerie, Fubon Bank (Hong Kong), challenging market conditions, enhancement to the retail LIFETASTIC, mi-tu, Marimekko, New Balance, O.N.S | kapok, tenant mix continued. New and experiential retail brands Polo Ralph Lauren, Skechers and XOVĒ. Cathay Pacific has were introduced. K-way, Max Mara, Omega, Reign Abalone, launched its first new retail concept store in Cityplaza. The Hawk & Aster / Elephant Grounds and Venchi became APiTA completed the major renovation on the ground floor tenants. Joyce took more space and opened its new with the introduction of two new restaurants (SENSU and flagship store. Burberry was relocated within The Mall. The Shiawase Yakitori) and unveiled an elevated and expanded premises occupied by adidas, Brooks Brothers, Chloé, La food hall, APITA Eatery. Newly renovated LOG-ON Mer, LensCrafters, Montblanc, Shanghai Tang, Vilebrequin, reopened with its new F&B, cafe ToGather by LOG-ON. Zadig & Voltaire were refitted. 44

Nike and Sabon renovated its shops. Blooms Coffee, Fresh Handmade Pasta, Pho Le, Que by Rin Horiuchi, Rabeanco, (a beauty brand), Carnival (a new food hall) and Sushi Taka Rayban, Save The Duck and Shake Shack. Starbucks at (a Japanese restaurant) were opened in early 2023. North phase were upgraded to Starbucks Reserve. Citygate Outlets Hong Kong Retail Market Outlook Citygate Outlets is the largest premium outlet mall in Footfall and tenants’ sales in Hong Kong are expected to Hong Kong with approximately 200 shops and restaurants, improve with removal of COVID-19 related measures and and with 2 hotels. It is near tourist attractions and the reopening of the border with the Chinese Mainland. transportation links (Hong Kong International Airport and The following chart shows the percentage of attributable the Hong Kong-Zhuhai-Macao Bridge). It appeals to local gross rental income from the retail properties in Hong shoppers and tourists. Kong, for the month ended 31st December 2022, derived It was fully let in 2022. adidas, Burberry, Calvin Klein, cdf from leases expiring in the periods with no committed Beauty, Coach, Fortress, I.T/i.t, MCL Citygate, Nike, Polo renewals or new lettings. Tenancies accounting for Ralph Lauren, TaSTe and Uniqlo are major tenants. Over 20 approximately 26.8% of the attributable gross rental new tenants were introduced in 2022, such as Bath & Body income in the month of December 2022 are due to expire in Work, Cupping Room, Delsey, Haustage, Jimmy Choo, 2023, with tenancies accounting for a further 34.2% of such J. Journey, Jumpin Gym, Kapok, Life Kan, Man Mano rental income due to expire in 2024. RETAIL LEASE EXPIRY PROFILE 40% (At 31st December 2022) 30% 20% 10% 0 2023 2024 2025 and later SWIRE PROPERTIES ANNUAL REPORT 2022 45

MANAGEMENT DISCUSSION & ANALYSIS | REVIEW OF OPERATIONS Residential compulsory sale of the Wah Ha Factory Building site, the The completed residential portfolio comprises Pacific Place two sites are intended to be redeveloped for office and Apartments at Pacific Place, EAST Residences in Quarry other commercial uses with an aggregate GFA of Bay, STAR STUDIOS in Wan Chai and a number of luxury approximately 779,000 square feet. houses on Hong Kong Island and Lantau Island, with an 983-987A King’s Road and 16-94 Pan Hoi Street aggregate GFA of approximately 0.6 million square feet. In 2018, a joint venture company in which the Group The residential portfolio was 72% let at 31st December holds a 50% interest submitted a compulsory sale 2022. Demand for our residential investment properties application in respect of this site in Quarry Bay. Subject was primarily local, and was affected by COVID-19 as well to the joint venture company having successfully bid in as a net outflow of residents to overseas. the compulsory sale and in accordance with applicable Investment Properties Under Development town planning controls, it is expected that the site can be redeveloped for residential and retail uses with a GFA of Six Pacific Place approximately 440,000 square feet. (formerly known as 46-56 Queen’s Road East) Planning permission to develop this site in Wan Chai for 9-39 Hoi Wan Street and 33-41 Tong Chong Street office use was obtained in 2018. The site area is In June 2022, the Group submitted a compulsory sale approximately 14,400 square feet. The development has an application in respect of this site in Quarry Bay. The gross aggregate GFA of approximately 223,000 square feet. site area is approximately 20,060 square feet. Proceeding Superstructure works are in progress. Completion of with the development (the planning of which is being construction is expected later in 2023. reviewed) is subject to the Group having successfully bid in the compulsory sale. Others Wah Ha Factory Building, 8 Shipyard Lane and Taikoo Shing Car Parking Spaces Zung Fu Industrial Building, 1067 King’s Road Since November 2020, the Group has offered 2,530 car In 2018, the Group submitted compulsory sale applications parking spaces in the Taikoo Shing residential in respect of these two sites in Quarry Bay. In March 2022, development in Hong Kong for sale. 1,458 of these car the Group acquired the remaining interests in Zung Fu parking spaces had been sold at 7th March 2023. Industrial Building and obtained full ownership of the site. Sales of 1,452 car parking spaces had been recognised at Subject to the Group having successfully bid in the 31st December 2022, 250 of them in 2022. Sales of 6 car parking spaces are expected to be recognised in 2023. 46

Investment Properties – Chinese Mainland Overview The property portfolio in the Chinese Mainland comprises an aggregate of 22.5 million square feet of space, 14.1 million square feet of which is attributable to the Group. Completed properties amount to 13.9 million square feet, with 8.6 million square feet under development. Total attributable gross rental income from investment properties in the Chinese Mainland was HK$5,172 million in 2022. At 31st December 2022, the investment properties in the Chinese Mainland were valued at HK$108,978 million. Of this amount, the Group’s attributable interest was HK$73,665 million. (1) Chinese Mainland Property Portfolio GFA (sq. ft.) (100% Basis) Investment Hotels and Under Attributable Total Properties Others Planning Interest Completed Taikoo Li Sanlitun, Beijing 1,789,000 1,619,537 169,463 – 100% Taikoo Hui, Guangzhou 3,782,327 3,272,893 509,434 – 97% INDIGO, Beijing 1,894,141 1,535,840 358,301 – 50% (2) 1,654,565 1,461,428 193,137 – 65% Sino-Ocean Taikoo Li Chengdu HKRI Taikoo Hui, Shanghai 3,536,619 3,148,792 387,827 – 50% Taikoo Li Qiantan, Shanghai 1,188,727 1,188,727 – – 50% Hui Fang, Guangzhou 90,847 90,847 – – 100% Others 2,917 2,917 – – 100% Sub-Total 13,939,143 12,320,981 1,618,162 – Under Development (3) INDIGO Phase Two, Beijing 4,045,514 – – 4,045,514 35% (4) Taikoo Li Xi’an 2,364,668 – – 2,364,668 70% (5) Sanya 2,143,440 2,143,440 – – 50% Sub-Total 8,553,622 2,143,440 – 6,410,182 Total 22,492,765 14,464,421 1,618,162 6,410,182 (1) Including hotels and properties leased for investment. (2) In December 2022, the Group acquired an additional 15% interest in Sino-Ocean Taikoo Li Chengdu. The Group’s interest increased from 50% to 65% after the transaction. (3) This is an office-led mixed-use development. The development scheme is being planned. The development is planned to be completed in two phases, in 2025 and 2026. (4) This is a retail-led mixed-use development. The development scheme is being planned. The development is planned to be completed in late 2025. (5) This is a retail-led development. The development is planned to be completed in phases from late 2024. Gross rental income (after deduction of rental concessions of HK$113 million) from the Group’s investment property portfolio in the Chinese Mainland was HK$3,324 million in 2022, 8% lower than in 2021, reflecting the COVID-19 resurgence in the cities where our malls operate. This partly offset by a full year contribution from Taikoo Li Sanlitun West. 47 SWIRE PROPERTIES ANNUAL REPORT 2022

MANAGEMENT DISCUSSION & ANALYSIS | REVIEW OF OPERATIONS Retail The completed retail portfolio in the Chinese Mainland comprises an aggregate of 7.9 million square feet of space, 5.7 million square feet of which is attributable to the Group. Total attributable gross rental income from our retail properties in the Chinese Mainland declined by 5%, to HK$4,242 million, in 2022. Disregarding rental concessions and changes in the value of the Renminbi, total attributable gross rental income increased by 4%. At 31st December 2022, our completed retail properties in the Chinese Mainland were valued at HK$67,719 million. Of this amount, the Group’s attributable interest was HK$51,762 million. The portfolio consists of Taikoo Li Sanlitun in Beijing and Hui Fang in Guangzhou, which are wholly-owned by the Group, Taikoo Hui in Guangzhou, which is 97% owned, INDIGO in Beijing, HKRI Taikoo Hui and Taikoo Li Qiantan in Shanghai, each of which is 50% owned, and Sino-Ocean Taikoo Li Chengdu, which is 65% owned after the completion of the acquisition of additional 15% interest in December 2022. Chinese Mainland Completed Retail Portfolio GFA (sq. ft.) Occupancy Attributable (100% Basis) (at 31st December 2022) Interest Taikoo Li Sanlitun, Beijing (1) 1,619,537 94% 100% Taikoo Hui, Guangzhou 1,529,392 99% 97% INDIGO, Beijing 946,769 100% 50% (2) Sino-Ocean Taikoo Li Chengdu 1,354,624 95% 65% HKRI Taikoo Hui, Shanghai 1,173,459 97% 50% (3) Taikoo Li Qiantan, Shanghai 1,188,727 93% 50% Hui Fang, Guangzhou 90,847 100% 100% Total 7,903,355 (1) Including Taikoo Li Sanlitun West, which officially opened in December 2021. (2) In December 2022, the Group acquired an additional 15% interest in Sino-Ocean Taikoo Li Chengdu. The Group’s interest increased from 50% to 65% after the transaction. (3) Including space allocated to prospective tenants who have signed letters of intent. Retail sales in the Chinese Mainland started strongly. There were full year contributions from the Taikoo Li Sanlitun West and Taikoo Li Qiantan developments in 2022. From the second quarter, the Group’s six shopping malls were affected to varying degrees by COVID-19 related measures. Shops in Shanghai, Beijing and Chengdu were closed for periods. The increase in COVID-19 cases which followed adjustments to COVID-19 policies in December 2022 caused short-term disruption. Tenants were understaffed and their operations were adversely affected. Our retail sales in the Chinese Mainland (excluding Taikoo Li Sanlitun West and Taikoo Li Qiantan) decreased on an attributable basis by 20% in 2022. Retail sales in Taikoo Li Sanlitun and INDIGO in Beijing, Taikoo Hui in Guangzhou, Sino-Ocean Taikoo Li Chengdu and HKRI Taikoo Hui in Shanghai decreased by 26%, 26%, 11%, 15% and 36% respectively in 2022. National retail sales decreased by 0.2%. The Group’s gross rental income (after deduction of rental concessions of HK$113 million) from retail properties in the Chinese Mainland decreased by 9%, to HK$2,943 million, in 2022. Rental concessions were given to tenants for specific periods on a case-by-case basis. Disregarding rental concessions and changes in the value of the Renminbi, gross rental income decreased by 2%. 48

The chart below shows the mix of the tenants of the retail properties by the principal nature of their businesses (based on internal classifications) as a percentage of the retail area at 31st December 2022. RETAIL AREA BY TENANTS’ BUSINESSES (At 31st ecember  19.7% Fashion and Supermarkets 2.8% accessories 42.5% 5.2% Food and Jewellery beverages and watches 5.3% Cinemas Others 24.5% At 31st December 2022, the top ten retail tenants (based development in 2022. Bottega Veneta, Celine, LLADRO and on attributable gross rental income in the twelve months Roger Vivier became tenants in 2022. As an extension to ended 31st December 2022) together occupied Taikoo Li Sanlitun South, tenants in Taikoo Li Sanlitun West approximately 19% of the Group’s total attributable retail include DESCENTE Kinetic Lab Global Experience Centre, area in the Chinese Mainland. Nike Rise, Uniqlo Global Sanlitun Flagship Store, M One KTV and MixPower. Taikoo Li Sanlitun, Beijing Retail sales at Taikoo Li Sanlitun decreased by 26% in 2022. Taikoo Li Sanlitun is in the Sanlitun area of the Chaoyang Gross rental income (after deduction of rental concessions) district of Beijing. It was our first retail development in the at the development decreased. Shops and restaurants were Chinese Mainland. It comprises three neighbouring retail shut from time to time as a result of COVID-19. Rental sites, South, North and West. There are approximately income benefitted from a full year of income from Taikoo Li 281 retail outlets. Sanlitun West and an improved tenant mix. Demand for Taikoo Li Sanlitun South concentrates on contemporary retail space at Taikoo Li Sanlitun is solid as it reinforces its fashion and lifestyle brands. In 2022, Gentle Monster position as a fashionable retail destination. The opened its world’s largest global flagship store and adidas development was 94% let at 31st December 2022. upgraded its Beijing flagship store to Asia Pacific’s first-ever “adidas Halo” concept store in the development. Apple, Taikoo Hui, Guangzhou ARKET, World of Ralph Lauren and a 1,597-seat Megabox Taikoo Hui is in the Tianhe district of Guangzhou. Its mall is cinema are tenants. A-COLD-WALL*, by Far, Creed, DC a popular shopping centre in Guangzhou. Bottega Veneta, Shoes, Editions De Parfums Frederic Malle, HOKA ONE Cartier, Chanel, DIOR, Gucci, Hermès, I.T, Louis Vuitton, Saint ONE, Kilian, Nautica Whitesail, Peak Performance, Penfield, Laurent, Van Cleef & Arpels, Uniqlo, Victoria’s Secret, STUSSY, WE11DONE, Don Nino, LIAN, Men Hwa, Spring Fangsuo bookstore and Olé Supermarket are tenants. Patio, Tarentum, Tiago Urban Kitchen and Yaki Bar became Editions De Parfums Frederic Malle, I-Primo, Kilian, Managi, tenants in 2022. Tenants in Taikoo Li Sanlitun North are Manito, Pleats Please Issey Miyake & Bao Bao Issey principally retailers of luxury, designer fashion and lifestyle Miyake, Rock&Ride, Rolex, self-portrait, Thom Browne, brands. Balenciaga, Gucci, LOEWE, Moncler, CANADA Vacheron Constantin, Ah Ma Hand made, Baker & Spice, GOOSE and SPACE are tenants. I.T, Bape and Alexander Chop-chop Noodles, Don Nino and Mikisi Japanese Bistro McQueen upgraded to their flagship stores in the became tenants in 2022. SWIRE PROPERTIES ANNUAL REPORT 2022 49

MANAGEMENT DISCUSSION & ANALYSIS | REVIEW OF OPERATIONS INDIGO BEIJING Retail sales and gross rental income (after deduction of stores or upgraded to their latest concept stores in 2022 rental concessions) at Taikoo Hui decreased by 11% and including Louis Vuitton Maison and The Hall Restaurant, 8% respectively in 2022. There were improvements to the Balenciaga, Boucheron, Cartier Masion, Dior Couture and tenant mix. The mall was 99% let at 31st December 2022. The World of Ralph Lauren. INDIGO, Beijing Retail sales and gross rental income (after deduction of INDIGO mall is in the Jiangtai area in the Chaoyang district rental concessions) at Sino-Ocean Taikoo Li Chengdu of Beijing. It is directly linked to the Beijing Metro Line 14 decreased by 15% and 9% respectively. The development and is near the airport expressway. i.t, Massimo Dutti, Muji, is reinforcing its position as a premium shopping and Tesla, SISYPHE bookstore, BHG Market Place and a seven- leisure destination. The development was 95% let at house with 1,000-seat CGV cinema are tenants. adidas 31st December 2022. women, HOKA ONE ONE, HUAWEI, moodytiger, New HKRI Taikoo Hui, Shanghai Balance 1906, OVV, Saucony, Uniqlo, % Arabica and HKRI Taikoo Hui is on Nanjing West Road in the Jing’an WANXIEHUI became tenants in 2022. The mall has become district of Puxi, Shanghai. It has excellent transport a significant fashion and lifestyle shopping centre in north- connections, being next to the Nanjing West Road metro east Beijing. station (which serves three metro lines) and near the Retail sales at INDIGO decreased by 26% in 2022. There Yan’an Expressway. were improvements to the tenant mix. The mall was 100% HKRI Taikoo Hui is our second Taikoo Hui development in let at 31st December 2022. the Chinese Mainland. Starbucks Reserve Roastery, Atelier Sino-Ocean Taikoo Li Chengdu Cologne, Bremont, COS, diptyque, dunhill, Ermengildo Sino-Ocean Taikoo Li Chengdu is in the Jinjiang district of Zegna, Guerlain, Golden Goose, IWC, i.t, Kenzo, Lululemon, Chengdu and is part of the Chunxi Road/Daci Temple MARNI MARKET, Max Mara, Nio, SPACE, Tesla, The shopping district. It is our second Taikoo Li project in the Cheesecake Factory, Shanghai Club, Ho Hung Kee and a Chinese Mainland. Apple, Balenciaga, Gucci, Dior, Hermès, city’super supermarket are tenants. CANADA GOOSE, I.T, Tiffany & Co., Muji, Fangsuo bookstore, Olé Supermarket drivepro lab, FIVE GUYS, Fook Luk House, GAGA, LOEWE, and a 1,720-seat Palace-j’aime cinema are tenants. Despite MOOSE KNUCKLES, self-portrait, Theory, UNDEFEATED and COVID-19 resurgence in Chengdu, 85 brands opened new Venchi became tenants in 2022. 50

Retail sales and gross rental income (after deduction of 2022. At 31st December 2022, tenants had committed rental concessions) at HKRI Taikoo Hui decreased by 36% (including by way of letters of intent) to take 93% of the and 17% respectively in 2022. Shops were closed in April retail space and 83% of the lettable retail space was open. and May. The mall was 97% let at 31st December 2022. Chinese Mainland Retail Market Outlook Taikoo Li Qiantan, Shanghai Consumer confidence is expected to improve in the Jointly developed with a subsidiary of Shanghai Lujiazui Chinese Mainland, following the adjustments made to Finance & Trade Zone Development Co., Ltd., Taikoo Li COVID-19 policies at the end of 2022. Inbound and Qiantan is a retail development in Qiantan, Pudong outbound travel is expected to increase. In Guangzhou and new district in Shanghai. Connected with 3 metro lines, Chengdu, demand for retail space from retailers of luxury it has an aggregate GFA of 1,188,727 square feet and brands is expected to be strong. In Shanghai, demand for space for around 250 shops. It is our second development retail space from retailers of luxury fashion, cosmetics and in Shanghai and the third Taikoo Li project in the lifestyle brands, and from operators of food and beverage Chinese Mainland. outlets, is expected to be steady. In Beijing, retail sales and The development officially opened in September 2021. demand for retail space are expected to be moderate. Footfall and retail sales were initially strong in 2022. They The following chart shows the percentage of attributable were adversely affected by COVID-19 related measures gross rental income from the retail properties in the from March to May. A number of new flagship stores Chinese Mainland, for the month ended 31st December opened after operation resumption including Bulgari, 2022, derived from leases expiring in the periods with no Cartier, Dior, Gucci, Hermès, Louis Vuitton, Max Mara, committed renewals or new lettings. Tenancies accounting Mikomoto, Moncler, China’s first Museum of Ice Cream, for approximately 32.1% of the attributable gross rental Team Wang and Valentino. The first MUJI flagship store income in the month of December 2022 are due to expire in with Marche in the Chinese Mainland became tenant in 2023, with tenancies accounting for a further 25.8% of such rental income due to expire in 2024. RETAIL LEASE EXPIRY PROFILE 50% (At 31st December 2022) 40% 30% 20% 10% 0 2023 2024 2025 and later SWIRE PROPERTIES ANNUAL REPORT 2022 51

MANAGEMENT DISCUSSION & ANALYSIS | REVIEW OF OPERATIONS Offices The completed office portfolio in the Chinese Mainland comprises an aggregate of 4.1 million square feet of space, 2.9 million square feet of which is attributable to the Group. Total attributable gross rental income from our office properties in the Chinese Mainland decreased by 1% to HK$867 million in 2022. Disregarding changes in the value of the Renminbi, total attributable gross rental income increased by 2%. At 31st December 2022, our completed office properties in the Chinese Mainland were valued at HK$21,021 million. Of this amount, the Group’s attributable interest was HK$13,149 million. The portfolio consists of Taikoo Hui in Guangzhou, which is 97% owned, and INDIGO in Beijing and HKRI Taikoo Hui in Shanghai, each of which is 50% owned. Chinese Mainland Completed Office Portfolio GFA (sq. ft.) Occupancy Attributable (100% Basis) (at 31st December 2022) Interest Taikoo Hui, Guangzhou 1,693,125 94% 97% INDIGO, Beijing 589,071 94% 50% HKRI Taikoo Hui, Shanghai 1,828,060 99% 50% Total 4,110,256 Demand for office space in Beijing, Shanghai and Guangzhou were adversely affected by COVID-19 resurgence in 2022. In Guangzhou, demand for office space was weak and new supply put pressure on office rents. Office rents in Shanghai remained resilient in core areas but decreased in decentralised areas reflecting the amount of new supply and the higher vacancy rates. In Beijing, despite weak demand, office rents remained stable due to limited new supply in core areas. The Group’s gross rental income from office properties in the Chinese Mainland decreased by 4% to HK$365 million in 2022. Disregarding changes in the value of the Renminbi, the gross rental income was approximately the same. The chart below shows the mix of the tenants of the office properties by the principal nature of their businesses (based on internal classifications) as a percentage of the office area at 31st December 2022. OFFICE AREA BY TENANTS’ BUSINESSES t st ecem er ­€­­‚ 2.5% 6.7% 7.0% 29.2% Banking/Finance/ Technology/ Pharmaceutical Securities/Investment Media/Telecoms manufacturing 14.4% Trading Professional services Real estate/Construction/ Property development/ rchitecture thers 16.5% 23.7% 52

Taikoo Hui GUANGZHOU At 31st December 2022, the top ten office tenants (based are technology, media and telecoms companies. Disney, Eli on attributable gross rental income in the twelve months Lilly, Rolls Royce and Western Cloud are tenants. Coupang ended 31st December 2022) together occupied leased more office space in 2022. Rhenus Logistics became approximately 47% of the Group’s total attributable office tenant in 2022. area in the Chinese Mainland. HKRI Taikoo Hui, Shanghai Taikoo Hui, Guangzhou There are two office towers at HKRI Taikoo Hui in Shanghai. There are two office towers in Taikoo Hui, Guangzhou. They They were 99% let at 31st December 2022. Demand slowed were 94% let at 31st December 2022. Demand for office down in 2022. The main tenants are financial services space in 2022 was weak and rents were under pressure. companies, pharmaceutical companies, law firms, gaming Apple, Canon, CapitaLand, Cushman & Wakefield, HSBC, companies and retailers. Abbvie, Advent Capital, Alliance FedEx, Medtronic, Microsoft, Roche, Samsung, SFML, Bernstein, Amore Pacific, Bank of China, Bally, Beautiful Sumitomo Corporation and Eyugame leased more space in Tree, BionTech, Byredo, Canali, Citic Capital, Clifford 2022. Dior, Edelman, EIC Education, Lectoredu and Louis Chance, EA, Eli Lilly, Fangda Partners, Fidelity, H&M, Harry Vuitton became tenants in 2022. Winston, Jimmy Choo, JLL, Jun He Law Offices, Michael Kors, Rothschild, Towers Research Capital, Versace and INDIGO, Beijing Warner Brothers are tenants. Blackstone, Chanel, CVC ONE INDIGO was 94% let at 31st December 2022. Despite Capital Partners, Genesis, Han Kun Law Offices, KRR, weak demand for office space, office rents were stable with Neuberger Berman, Supercell and White & Case leased the limited new supply in the core areas. The main tenants more space in 2022. 53 SWIRE PROPERTIES ANNUAL REPORT 2022

MANAGEMENT DISCUSSION & ANALYSIS | REVIEW OF OPERATIONS Chinese Mainland Office Market Outlook In Guangzhou, new supply in decentralised areas is expected to put downward pressure on office rents. In Beijing, new supply in core areas is limited. Demand should benefit from the removal of COVID-19 related measures. In Shanghai, demand is expected to be stable. Office rents in core central business districts, where supply is limited, are expected to be stable. The following chart shows the percentage of attributable gross rental income from the office properties in the Chinese Mainland, for the month ended 31st December 2022, derived from leases expiring in the periods with no committed renewals or new lettings. Tenancies accounting for approximately 25.4% of the attributable gross rental income in the month of December 2022 are due to expire in 2023, with tenancies accounting for a further 25.9% of such rental income due to expire in 2024. OFFICE LEASE EXPIRY PROFILE 50% (At 31st December 2022) 40% 30% 20% 10% 0 2023 2024 2025 and later Serviced Apartments There are 24 serviced apartments at the Mandarin Oriental in Taikoo Hui Guangzhou, 42 serviced apartments at The Temple House in Sino-Ocean Taikoo Li Chengdu and 102 serviced apartments at The Middle House Residences in HKRI Taikoo Hui Shanghai. The performance of the serviced apartments in 2022 was adversely affected by COVID-19 associated restrictions. Occupancy at the Mandarin Oriental in Guangzhou, The Temple House in Chengdu and The Middle House Residences in Shanghai was 88%, 76% and 64% respectively at 31st December 2022. Chinese Mainland Serviced Apartments Market Outlook The performance of the serviced apartments is expected to recover following the adjustments to COVID-19 restrictions in 2023. Investment Properties Under Development INDIGO Phase Two, Beijing INDIGO Phase Two is an extension of the existing INDIGO development, with a GFA of approximately four million square feet. Jointly developed with the Sino-Ocean group, INDIGO Phase Two will be an office-led mixed-use development and is planned to be completed in two phases, in 2025 and 2026. Basement works are in progress. The Group has a 35% interest in INDIGO Phase Two. 54

Taikoo Li Xi’an Sanya In March 2022, a consortium in which the Group has a 70% In October 2022, a consortium in which the Group has a interest acquired (via a government land tender) the land 50% interest acquired (via a government land tender) the use rights in respect of land in the Small Wild Goose land use rights in respect of land in the Haitang district of Pagoda historical and cultural zone in the Beilin district of Sanya with a site area of approximately 2.1 million square Xi’an. With a site area of approximately 1.3 million square feet. The land is expected to be developed into a premium, feet, the land is expected to be developed as Taikoo Li resort-style, retail-led development including underground Xi’an, a retail-led mixed-use development comprising retail parking and other ancillary facilities. The development will and cultural facilities, a hotel, serviced residences and be Phase III of the Sanya International Duty-Free Complex. business apartments. The estimated GFA is approximately The project is expected to open in phases from late 2024. 2.4 million square feet (above ground), subject to further The development is being done in collaboration with planning. The project is expected to be completed in late China Tourism Group Duty Free Corporation Limited. 2025. The development is being done in collaboration with The chart below illustrates the expected attributable Xi’an Cheng Huan Cultural Investment and Development area of the completed property portfolio in the Co., Ltd. Chinese Mainland. ATTRIBUTABLE AREA OF COMPLETED GFA PROPERTY PORTFOLIO IN THE (000 sq. ft.) CHINESE MAINLAND 15,000 Taikoo Li Sanlitun, ‡ˆ Taikoo ui, San‰a(2) 12,000 Beiin Sanai Taikoo ui, Taikoo Li †iantan, ui Fan, 9,000 Guanou Sanai Guanou  ­G€, Beiin  ­G€ Žase T‘o, €teŒs 6,000 Beiin 3,000 Sino‚€ƒean Taikoo Li Ši’an Taikoo Li (1) „en…u 0 2023 to 2024 2025 2026 and later (1) In December 2022, the Group acquired an additional 15% interest in Sino-Ocean Taikoo Li Chengdu. The Group’s interest increased from 50% to 65% after the transaction. The attributable area represents 100% interests in the site after the completion of the acquisition of the remaining 35% interest in February 2023. (2) The development is expected to open in phases from late 2024. GFA completed at year end of 2024 has yet to be determined. Others ZHANGYUAN, Shanghai In 2021, the Group formed a joint venture management company with Shanghai Jing’an Real Estate (Group) Co., Ltd. This company, in which the Group has a 60% interest, is engaged in the revitalisation and management of the ZHANGYUAN Shikumen compound in the Jing’an district of Shanghai. When the revitalisation is completed, the compound will have a GFA (including car parking spaces) of 591,189 square feet above ground and 738,066 square feet underground. There are over 40 Shikumen blocks, with about 170 two or three-storey houses. There are connections to three metro lines and to HKRI Taikoo Hui. The first phase (the West zone) was completed and opened in November 2022. Construction and renovation at the second phase (the East zone) are in progress. The second phase is planned to be completed and opened in 2026. The Group does not have an ownership interest in the compound. SWIRE PROPERTIES ANNUAL REPORT 2022 55

MANAGEMENT DISCUSSION & ANALYSIS | REVIEW OF OPERATIONS Brickell City Centre MIAMI Investment Properties – U.S.A. The Group owns 62.93% of the shopping centre at the Overview Brickell City Centre development. The remaining interest in the shopping centre is owned by Simon Property Group Brickell City Centre, Miami (25%) and Bal Harbour Shops (12.07%). Bal Harbour Shops Brickell City Centre is an urban mixed-use development in has an option, which has been exercisable since February the Brickell financial district of Miami, U.S.A. It has a site 2020, to sell its interest to the Group. area of 504,017 square feet (approximately 11.6 acres). The shopping centre was 89% leased (including by way of The first phase of the Brickell City Centre development letters of intent) at 31st December 2022. Retail sales in comprises a shopping centre, two office towers (Two and 2022 increased by 24%. Three Brickell City Centre, which were sold in 2020), a hotel The second phase of the Brickell City Centre development, with serviced apartments (EAST Miami, which was sold in to be known as One Brickell City Centre, is being planned. It 2021) managed by Swire Hotels and two residential towers will be a commercial development and will be connected to (Reach and Rise) developed for sale. All the residential the first phase of Brickell City Centre. units at Reach and Rise have been sold. 56

Brickell City Centre, Miami (1) GFA (sq. ft.) Attributable (100% Basis) Interest Completed Shopping centre 496,508 62.9% Future Development One Brickell City Centre 1,510,000 100% Total 2,006,508 (1) Represents leasable/saleable area except for the car parking spaces, roof top and circulation areas. Miami Market Outlook In Miami, retail sales are expected to increase. Valuation of Investment Properties The portfolio of investment properties was valued at 31st December 2022 on the basis of market value (95% by value having been valued by Cushman & Wakefield Limited and 2% by value having been valued by another independent valuer). The amount of this valuation was HK$271,191 million, compared to HK$267,815 million at 31st December 2021. The increase in the valuation of the investment property portfolio primarily reflected new investment and an increase in the valuation of certain existing properties in the Chinese Mainland (reflecting a reduction of 25 to 50 basis points in the capitalisation rates), partly offset by a decrease in the valuation of the office investment properties in Hong Kong and foreign exchange translation losses in respect of the investment properties in the Chinese Mainland. Under HKAS 40, hotel properties are not accounted for as investment properties. The hotel buildings are included within property, plant and equipment. The leasehold land is included within right-of-use assets. Both are recorded at cost less accumulated depreciation or amortisation and any provision for impairment. MOVEMENT IN INVESTMENT HK$ Bn PROPERTIES 276 +7.3 -0.8 275 -0.5 -3.4 274 273 At 1st January Net fair value Net transfers to 272 2022 ains in te ‚ro‚ertyƒ ‚lant 271 271.2  ­ A an e„ui‚…ent† Net fair value Aitions oter assets 270 losses in ‡ranslation 269 Hon Kon ifferenˆes +0.4 Net fair value €is‚osals 268 267.8 -1.1 +1.5 ains in te At 31st €eˆe…‰er 267 inese ainlan 2022 266 1st Jan 2022 31st Dec 2022 SWIRE PROPERTIES ANNUAL REPORT 2022 57

MANAGEMENT DISCUSSION & ANALYSIS | REVIEW OF OPERATIONS Property Trading Overview The trading portfolio comprises completed units available for sale at EIGHT STAR STREET in Hong Kong and The River in Vietnam. There are six residential projects under planning or development, three in Hong Kong, one in Indonesia, one in Vietnam and one in Thailand. There are also land banks in Miami, U.S.A. Property Trading Portfolio (At 31st December 2022) Actual/Expected GFA (sq. ft.) Construction Attributable (100% Basis) Completion Date Interest Completed Hong Kong (1) (2) – EIGHT STAR STREET, Wan Chai 5,897 2022 100% Vietnam (2) – The River 185,594 2022 20% Under Development Hong Kong – Wong Chuk Hang Station Package Four Property Development 638,305 2024 25% (3) – Chai Wan Inland Lot No. 178 694,278 2025 80% (4) (5) – 269 Queen’s Road East, Wan Chai 102,990 2025 100% Indonesia – Savyavasa, South Jakarta 1,122,728 2024 50% Vietnam – Empire City 7,131,624 2028 15.73% Held for Development or sale U.S.A. – South Brickell Key, Miami, Florida 550,000 N/A 100% (6) 523,000 N/A 100% – Brickell City Centre, Miami, Florida – North Squared site (1) The occupation permit for EIGHT STAR STREET was issued in May 2022. (2) Remaining saleable area. (3) Including a retail podium of approximately 2,002 sq. ft. (4) In June 2022, the Group acquired this site (via a government land tender). (5) Excluding a retail podium of approximately 13,197 sq. ft. (6) Represents saleable area. Hong Kong EIGHT STAR STREET, Wan Chai EIGHT STAR STREET at 8 Star Street, Wan Chai is a residential building (with retail outlets on the lowest two levels) of approximately 34,000 square feet. The occupation permit was obtained in May 2022. 30 out of 37 units had been sold at 7th March 2023. 27 units had been handed over to the purchasers as 31st December 2022. 58

Wong Chuk Hang Station Package Four Property Vietnam Development In 2020, the Group agreed with City Garden Joint Stock A joint venture formed by the Group, Kerry Properties Company to develop The River, a luxury residential Limited and Sino Land Company Limited is undertaking a property in Ho Chi Minh City, Vietnam. The development residential development in Wong Chuk Hang in Hong Kong. comprises 525 luxury apartments in three towers. The The development will comprise two residential towers with Group has an effective 20% interest in the development. an aggregate GFA of approximately 638,000 square feet Approximately 93% of the units had been sold at 7th March and about 800 residential units. Superstructure works are in 2023. Handover of the completed units to purchasers is progress. Pre-sales are expected to start in the second in progress. quarter of 2023. The development is expected to be In 2021, the Group made a minority investment in Empire completed in 2024. The Group has a 25% interest in the City, a residential-led mixed-use development (with joint venture. residential, retail, office, hotel and serviced apartment Chai Wan Inland Lot No. 178 components) in Ho Chi Minh City, Vietnam. The In 2021, a project company held as to 80% by the Group development is under construction and is expected to be and as to 20% by China Motor Bus Company, Limited completed in phases up to 2028. The Group invested in the completed a land exchange with the HKSAR Government in development through an agreement with Gaw Capital respect of a plot of land in Chai Wan. The plot of land is Partners, an existing participant in the development. expected to be redeveloped into a residential complex Over 47% of the residential units had been pre-sold at (with retail outlets) with an aggregate GFA of 7th March 2023. approximately 694,000 square feet. Foundation works are Thailand in progress. The development is expected to be completed In February 2023, the Group acquired a 40% interest in a in 2025. site located in Lumphini sub-district in Pathum Wan district, 269 Queen’s Road East, Wan Chai Bangkok. In partnership with City Realty Co. Ltd., the site is In June 2022, the Group acquired (via a government land expected to be developed for residential purposes with a tender) a plot of land at 269 Queen’s Road East in Wan site area of approximately 136,000 square feet. Chai. The plot of land will be developed primarily for Indonesia, Vietnam and Thailand Residential residential uses with an aggregate GFA of approximately Market Outlook 116,000 square feet. Works preparatory to demolition of With urbanisation, a growing middle class and a limited the existing building have commenced. The development is supply of luxury residential properties, the residential expected to be completed in 2025. markets in Jakarta, Indonesia, Ho Chi Minh City, Vietnam Hong Kong Residential Market Outlook and Bangkok, Thailand are expected to be stable. In Hong Kong, demand for residential accommodation is Estate Management expected to be weak in the short term (due to increased interest rates and economic uncertainty) but resilient in The Group manages approximately 20 residential estates the medium and long term, reflecting local demand and which it has developed. It also manages OPUS HONG KONG, limited supply. a residential property in Hong Kong which the Group Indonesia redeveloped for Swire Pacific Limited. The management In 2019, a joint venture between the Group and Jakarta services include day to day assistance for occupants, Setiabudi Internasional Group completed the acquisition of management, maintenance, cleaning, security and a plot of land in South Jakarta, Indonesia. The land is being renovation of common areas and facilities. The Group developed for residential purposes with an aggregate GFA places great emphasis on maintaining good relationships of approximately 1,123,000 square feet. Superstructure with occupants. works are in progress. The development is expected to comprise over 400 residential units and to be completed in 2024. The Group has a 50% interest in the joint venture. Pre-sales are in progress. 59 SWIRE PROPERTIES ANNUAL REPORT 2022

MANAGEMENT DISCUSSION & ANALYSIS | REVIEW OF OPERATIONS The Opposite House BEIJING Hotels The Upper House Managed Hotels and Restaurants At The Upper House, a 117-room luxury hotel at Pacific Place in Hong Kong, revenue per available room and Overview occupancy continued to be affected by COVID-19 The Group owns and manages (through Swire Hotels) associated travel restrictions. In 2022, the hotel was ranked hotels in Hong Kong, the Chinese Mainland and the number three in the Condé Nast Traveler’s 2022 Readers’ U.S.A. The House Collective, comprising The Upper Choice Awards for the Best Hotels in Hong Kong category. House in Hong Kong, The Opposite House in Beijing, The It also received awards from Travel + Leisure and Temple House in Chengdu and The Middle House in TripAdvisor, and was named Hong Kong’s Best Wellness Shanghai, is a group of small and distinctive luxury Retreat 2022 in the World Spa Awards. hotels. In July and August 2022, the Group announced the plans to further expand The House Collective to EAST Hong Kong Tokyo and Shenzhen. There are EAST hotels in Hong At EAST Hong Kong, a 331-room hotel in Taikoo Shing, Kong, Beijing and Miami. In October 2021, EAST Miami revenue per available room and occupancy were severely ceased to be owned by the Group. It continues to be affected by COVID-19 related travel restrictions. The hotel managed by Swire Hotels. was ranked number eight in the Condé Nast Traveler’s 2022 The managed hotels in Hong Kong and the Chinese Readers’ Choice Awards for The Best Hotels in Hong Kong Mainland were affected by the COVID-19 related travel category. restrictions. The hotels in the U.S.A. performed well. The Opposite House The managed hotels (including restaurants and taking The Opposite House is a 99-room luxury hotel at Taikoo Li account of central costs) recorded an operating loss Sanlitun, Beijing. Its occupancy and revenue per available before depreciation of HK$118 million in 2022, room declined in 2022 due to COVID-19 associated compared with an operating profit before depreciation restrictions. In 2022, the hotel received awards from Condé of HK$22 million in 2021. Nast Traveler and Travel + Leisure, and was ranked number five and six in TripAdvisor’s Top 25 Hotels and Luxury Hotels in China respectively. Jing Yaa Tang restaurant was awarded with 1-star in the MICHELIN Guide Beijing 2022. 60

EAST Beijing at HKRI Taikoo Hui, Shanghai. Revenue per available room EAST Beijing is a 369-room lifestyle hotel at INDIGO in and occupancy declined in 2022 due to COVID-19 Beijing, in which the Company has a 50% interest. associated restrictions. The food and beverages businesses Occupancy and revenue per available room were severely were also adversely affected. The hotel received awards affected by COVID-19 associated restrictions. The hotel from Condé Nast Traveler and TripAdvisor. Sui Tang Li was recognised as The Most Popular Hotel of the Year by restaurant was designated One-Diamond in the 2022 Black CAAC Inflight Magazine. Pearl Restaurant Guide. Mi Xun Spa was named The Most Effective Treatment of the Year award in the SpaChina The Temple House Wellness & Spa Awards 2022, and China’s Best Wellness The Temple House (in which the Company has a 65% Retreat of 2022 in the World Spa Awards. interest after the completion of the acquisition of additional 15% interest in December 2022) has 100 hotel EAST Miami rooms and 42 serviced apartments at Sino-Ocean Taikoo Li EAST Miami at the Brickell City Centre development in Chengdu. Revenue per available room and occupancy Miami has 263 hotel rooms and 89 serviced apartments. declined due to COVID-19 associated restrictions. The hotel The hotel was sold to a third party in October 2021. It received award from Condé Nast Traveler as the number continues to be managed by Swire Hotels. Its revenue per eleven of the Best Hotels in China and China Top 10 Hotels available room grew strongly in 2022. The hotel was in the Gold List. The Mi Xun Spa was named Best Spiritual included in the Condé Nast Traveler Gold List. Spa Treatment of the Year in SpaChina Wellness and Spa Awards 2022, and China’s Best Wellness Retreat 2022 in the Restaurants World Spa Awards 2022. The Mi Xun Tea House was Swire Hotels operates restaurants in Hong Kong through its awarded with 1-star in the MICHELIN Guide Chengdu 2022. hotels. It also operates a standalone restaurant. The Upper House operates The Continental, a European restaurant, at The Middle House Pacific Place. EAST Hong Kong operates Mr & Mrs Fox, a The Middle House (in which the Company has 50% restaurant with an international menu, and PUBLIC café at interest) has 111 hotel rooms and 102 serviced apartments Taikoo Place. Hotel Portfolio (managed by Swire Hotels) No. of Rooms Attributable (100% Basis) Interest Completed Hong Kong – The Upper House 117 100% – EAST Hong Kong 331 100% (1) – Headland Hotel 501 0% Chinese Mainland – The Opposite House 99 100% – EAST Beijing 369 50% (2) – The Temple House 142 65% (3) – The Middle House 213 50% U.S.A. (4) – EAST Miami 352 0% Total 2,124 (1) Headland Hotel is owned by Airline Property Limited, a wholly-owned subsidiary of Cathay Pacific Airways Limited. (2) Comprising one hotel tower and one serviced apartment tower. In December 2022, the Group acquired an additional 15% interest in Sino-Ocean Taikoo Li Chengdu. The Group’s interest in The Temple House increased from 50% to 65% after the transaction. (3) Comprising one hotel tower and one serviced apartment tower. (4) EAST Miami (including serviced apartments in the hotel tower) is owned by a third party. 61 SWIRE PROPERTIES ANNUAL REPORT 2022

MANAGEMENT DISCUSSION & ANALYSIS | REVIEW OF OPERATIONS Non-managed Hotels Overview The Group has ownership interests in (but does not manage) hotels with 3,138 rooms in aggregate. Hotel Portfolio (not managed by the Group) No. of Rooms Attributable (100% Basis) Interest Completed Hong Kong – Island Shangri-La Hong Kong 557 20% – JW Marriott Hotel Hong Kong 608 20% – Conrad Hong Kong 513 20% (1) – Novotel Citygate Hong Kong 440 26.67% (1) – The Silveri Hong Kong – MGallery 206 26.67% Chinese Mainland (2) – Mandarin Oriental, Guangzhou 287 97% – The Sukhothai Shanghai 201 50% U.S.A. – Mandarin Oriental, Miami 326 75% Total 3,138 (1) In March 2022, the Group acquired an additional 6.67% interest in the Citygate development. The Group’s interests in Novotel Citygate Hong Kong and The Silveri Hong Kong – MGallery increased from 20% to 26.67% after the transaction. (2) Including serviced apartments in the hotel tower. The non-managed hotels in Hong Kong and the Chinese Mainland were adversely affected by COVID-19 related travel restrictions. The non-managed hotel in the U.S.A. performed better. Average room rates and occupancy were higher. The Mandarin Oriental, Guangzhou is a leading luxury hotel in Guangzhou. The Chinese restaurant at the hotel, Jiang by Chef Fei, obtained a 2-star Michelin award. The Sukhothai Shanghai is a luxury hotel in Shanghai. The Silveri Hong Kong – MGallery in Hong Kong opened in phases from the middle of 2022. Hotels Market Outlook The hotels in Hong Kong and the Chinese Mainland are expected to do better in 2023, following the reopening of the border in the Chinese Mainland and the removal of COVID-19 measures. The hotels in the U.S.A. are expected to perform strongly. We are expanding our hotel management business, with a focus on extending our hotel brands outside Hong Kong through hotel management agreements. 62

Capital Commitments (2021: HK$1,010 million). Outstanding capital Capital Expenditure and Commitments commitments at 31st December 2022 were HK$16,076 million (2021: HK$6,184 million), including the Group’s Capital expenditure in 2022 on Hong Kong investment share of the capital commitments of joint venture properties and hotels, including the Group’s share of the companies of HK$7,370 million (2021: HK$4,777 million). capital expenditure of joint venture companies, amounted The Group is committed to funding HK$331 million to HK$3,246 million (2021: HK$3,281 million). Outstanding (2021: HK$1,146 million) of the capital commitments of capital commitments at 31st December 2022 were joint venture companies. In addition to this, the Group was HK$11,878 million (2021: HK$14,500 million), including the committed to make a capital injection into a joint venture Group’s share of the capital commitments of joint venture company of HK$421 million (2021: nil). companies of HK$67 million (2021: HK$73 million). Capital expenditure in 2022 on investment properties and Capital expenditure in 2022 on Chinese Mainland hotels in the U.S.A. amounted to HK$19 million (2021: investment properties and hotels, including the Group’s HK$49 million). There were no outstanding capital share of the capital expenditure of joint venture commitments at 31st December 2022 and 2021. companies, amounted to HK$4,879 million Profile of Capital Commitments for Investment Properties and Hotels Commitments Total relating to joint venture (1) (2) Expenditure Forecast expenditure Commitments companies 2026 2022 2023 2024 2025 and later At 31st December 2022 At 31st December 2022 HK$M HK$M HK$M HK$M HK$M HK$M HK$M Hong Kong 3,246 2,654 953 1,563 6,708 11,878 67 Chinese Mainland 4,879 3,731 4,186 3,796 4,363 16,076 7,370 U.S.A. 19 – – – – – – Total 8,144 6,385 5,139 5,359 11,071 27,954 7,437 (1) The capital commitments represent the Group’s capital commitments of HK$20,517 million plus the Group’s share of the capital commitments of joint venture companies of HK$7,437 million. (2) The Group is committed to funding HK$331 million of the capital commitments of joint venture companies. 63 SWIRE PROPERTIES ANNUAL REPORT 2022

MANAGEMENT DISCUSSION & ANALYSIS | REVIEW OF OPERATIONS 64

Development Highlights Two Taikoo Place Latest addition to the Taikoo Place Global Business District Two Taikoo Place, completed in September 2022, is the Two Taikoo Place and One Taikoo Place will be linked latest addition to Swire Properties’ HK$15 billion Taikoo to other office towers in the district by elevated Place Redevelopment Project to complement the walkways, opening up the ground level space for Taikoo community as it transforms into a Global Business District. Square and Taikoo Garden, totalling 70,000 square feet Featuring 42 storeys of premium office space with a total of landscaped gardens with cascading water features for area of around 1 million square feet, the triple Grade-A the community to enjoy after their completion in 2023, office tower has been designed and built to the highest in addition to more new F&B outlets with al fresco sustainability standards, and has incorporated a broad dining spaces. array of best-in-class sustainability and wellness features. Completion year Number of floors 2022 42 Total GFA APPROXIMATELY 1 MILLION SQUARE FEET Sustainability credits PRE-CERTIFIED PLATINUM RATINGS FOR LEED, WELL AND BEAM PLUS “PLATINUM” OF WIREDSCORE AND SMARTSCORE (HIGHEST CERTIFICATION LEVEL) 65 SWIRE PROPERTIES ANNUAL REPORT 2022

MANAGEMENT DISCUSSION & ANALYSIS | REVIEW OF OPERATIONS Development Highlights ZHANGYUAN Shanghai’s Urban Regeneration Project ZHANGYUAN, Shanghai’s first urban regeneration project space”, providing retail, commerce, office, hotel, residence, to implement protective expropriation and historical art museum and performing arts centre where Shanghai’s restoration, is operated and managed by a joint venture citizens can work, relax, shop and be entertained. between Swire Properties and Shanghai Jing’an Real Estate Swire Properties’ responsibilities in the ZHANGYUAN (Group) Co., Ltd. In November 2022, ZHANGYUAN West project extend to design, leasing, operational management Zone was officially opened to the public as the first phase. and marketing. A host of luxury brands has been introduced Featuring well-preserved Shikumen heritage buildings and and a diverse range of events, exhibitions and arts and rich historical architectural forms in Shanghai, ZHANGYUAN cultural activities will take place in the area. has been reshaped into a high-quality “first urban public 66

Phased Opening Number of Shikumen Total GFA Heritage Buildings From 2022 OVER 40 West: 208,700 SQUARE FEET (aboveground) in more than 20 different styles East: 382,489 SQUARE FEET (aboveground) 738,066 SQUARE FEET (underground) Owner Management Company SHANGHAI JING’AN URBAN REGENERATION SHANGHAI KAIYE COMMERCIAL MANAGEMENT CO. LTD. CONSTRUCTION AND DEVELOPMENT CO., LTD (A joint venture which Swire Properties has 60% interest and (A subsidiary of Shanghai Jing’an Real Estate (Group) Shanghai Jing’an Real Estate (Group) Co. Ltd. has 40% interest) Co. Ltd.) SWIRE PROPERTIES ANNUAL REPORT 2022 67

Taikoo Li Sanlitun, Beijing

MANAGEMENT DISCUSSION & ANALYSIS | REVIEW OF OPERATIONS HO‡† ‚O‡† CHI‡EE €I‡€‡D ŽŠŠ€Š Taikoo lace One Taikoo Place Oxford House Taikoo Hui TaikooHuiTowers “”’ Taikoo Li Taikoo i Brickell City Centre €0€338 s 0€3 s €­3€ s anlitun ‡orth and City la­a One Island East —˜†‚—™H•˜ Sanlitun ­3 s …I†…I šƒ•RI‘† PCCƒ Tower Berkshire €3 0€€ s andarin Oriental• 0€8 s House †uanghou BEIŒI‚— Dorset House 388838 s 0­3 s Taikoo i anlitun ƒest 0­0 s erviced €artments ­30 s Brickell Cit Centre incoln House 03 s hoing all­ 333­ s ­08 s E€T ˆuture „esidences Develoment 08 s The Oosite House ˆ3000 s r Tai Koo Station €­3 s o d i r r o C n r e t Two Brickell Cit Centre˜˜ s a E d n a l s I T i a n h d eE a a o s R t d R g o a n i a o h d R S o n o k u i E€T Hong ‚ong t a i T TaikooHui l Tianhe Road n a W €­­33 s hoing all­ S t e s e t l e a ShiŠai‹iao Station r n t d S s €­3­ s i R o o a H d Citlaa n a … P i a ‡ hoing all­ i R i “ Taikoo i e King’s Road €0­8­8 s r Quarry Bay anlitun outh … i a ‡ i R i “ e t r s Station ­0­ s W€ S e Devon House Cambridge House Two Taikoo Place u n e “ 803 s 8 ­ s ­­ s HKRI Taikoo Hui H‚„I Taikoo Hui H‚„I Centre “ † S hoing all­ €€­0€ s E …etrorail t hS t r e €€0 s Bri’kell Station e and HNGN S t E t The iddle House hS t r e H‚„I Centre ’ S e SH†‚—H†I „esidences W8 t t The ilveri One Citgate ‡ovotel Citgate Hong ‚ong €  3 s ­­0 s ino‘Ocean Taikoo i The Temle House hS t Sino-Ocean r e e Chengdu e t Hong ‚ong – €0 s 3 8 s ­­­€ s u Citygate n e “ i † S hoing Centre­ ‡ E a †aller The ukhothai i Taikoo Li … t h h t u S €3€3 s o t €3€­ s S r hanghai e The iddle e S t House  s Chengdu W­ t ˆuture €€€8€ s d hS …etro‡o“er a t o r Develoment d CHE‚—‘˜ i R e Eighth Street a s e i a o ’ t ” a a R ‘ l l P Station l ˆ€€0000 s g e k ’ n i i r ¢ B n a t‚ s e ‚orth ƒantau High„ay W dao T Ria a t T u h n i g R o e a d W — West ‚an¢ing E€T iami Three Brickell Cit Centre˜˜ Shi‡enyi Road Road Station g n u h C g n u … T e ¤ i T › u n n io t a t g S ™H†‚—–˜†‚ „ith gross loor area o S ™H€‡†šŽ€‡ t r e e t Citgate Outlets €3­ s ¥in’luding ’ar Šarking sŠa’es¦ ‰‰T„o Bri’kell City Centre and Three Bri’kell City Centre „ere sold in 00¡ 8038 s is oŠerated and ‡anaged Ÿy a ¢oint “enture The oi’e to„ers are no„ ‡anaged Ÿy S„ire ProŠerties¡ „hi’h is 0ž o„ned Ÿy S„ire ProŠerties¡ £ E†ST …ia‡i „as sold in 0€¡ The hotel and ser“i’ed aŠart‡ents are still ‡anaged Ÿy S„ire Hotels¡ S„ire ProŠerties does not ha“e an West ‚an¢ing Road Station o„nershiŠ interest in the ’o‡Šound¡ ChunŽi Road Station Three Pacific Place The Žer House One Conrad Hong ‚ong Island hangri‘a aciic lace   s €8 38 s Pacific Place ­0 s Hong ‚ong T€„ TŽDIO ‰ƒ arriott 83 s 0 8 s  3 s Hong ‚ong ­0 s INDIGO EI†HT T€„ T„EET I‡DI†O Phase Two E€T Bei–ing O‡E I‡DI†O Taikoo Li €38 s‰ BEIŒI‚— Žnder Develoment­ 3830€ s 8­0 € s P€CEŠ ‹Œ„E ˆ0€ s Qiantan Taikoo i Œiantan 8€3 s SH†‚—H†I hoing Centre­ €€88  s ’‹ Henness „oad To be renamed as H ˆive Pacific Place­ e n n e s s •riental SŠorts y R d o a d a o oR a €3­0 s i d ‹ Center Station Q n a u a e i e n Ž ‚otesœ s „ o a u y i †d‡iralty Œ uR ix Pacific Place Station y g —ross loor area igures are sho„n on a €00ž Ÿasis¡ n o ‰ šloor area sho„n in’luding the Žnder Develoment­ Three Pacific Place Pacific Place P€CIˆIC P€CE Two ‘ d These diagra‡s are not to s’ale and are or illustration ŠurŠoses only¡ a o tR s e I‡DI†O i W s g n a gross loor area o re‡aining ˆ3303 s Pedestrian ink hoing all­ €P€„T E‡T Pacific Place hoing all­ Œiangtai Station – These diagra‡s illustrate the ‡a¢or de“eloŠ‡ents o S„ire ProŠerties¡ šor details o other de“eloŠ‡ents residential units o €08€ s¡ Below †round­ €€€8 s 30  s ­€0 s ­ ­ s Šlease reer to the S’hedule o Prin’iŠal —rouŠ ProŠerties on Šages 0 to €¡

MANAGEMENT DISCUSSION & ANALYSIS | REVIEW OF OPERATIONS HO‡† ‚O‡†HO‡† ‚O‡† ŽŠŠ€Š CHI‡EE €I‡€‡DCHI‡EE €I‡€‡D ŽŠŠ€Š Taikoo laceTaikoo laceOne TOne Taikaikoo Placeoo PlaceOxOxfforord Housed HouseTaikoo HuiTaikoo Hui TTaikoaikooo HHuuii TToowweerrs s ““ ”” ’’ Taikoo LiTaikoo Li TTaikaikoo ioo i Brickell City CentreBrickell City Centre €0€338 s€0€338 s0€3 s0€3 s €­3€ s€­3€ s anlitun ‡oranlitun ‡orthth and City la­aand City la­aOne Island EastOne Island East——˜˜†‚—™H•˜†‚—™H•˜ SanlitunSanlitun ­3 s­3 s …I†…I šƒ•RI‘†…I†…I šƒ•RI‘† PCCPCCƒ Tƒ ToowwererBerkshirBerkshiree€3 0€€ s€3 0€€ s a annddaaririnn Ori Orieentalntal•• 0€8 s0€8 sHouseHouse ††uuaanngghhoouu BEIŒI‚—BEIŒI‚— DorDorset Houseset House388838 s388838 s 0­3 0­3 ss TTaikaikoo i anlitun ƒoo i anlitun ƒestest 0­0 s0­0 s eerrvviced €iced €artmeartmentntss ­30 s­30 s BrickBrickell Cit Centrell Cit Centree incoln Houseincoln House 03 03  ss hoing all­hoing all­ 333­ s333­ s ­08 s­08 s E€E€T T ˆˆuuturturee „„esidencesesidences DeDevvelomenteloment 08 s 08 s The OositThe Oosite Housee House ˆ3000 sˆ3000 s rrTTai Kai Koo Staoo Stationtion €­3 s€­3 s oo dd ii rr rr oo nnCC rr ee tt TTwwo Bricko Brickell Cit Centrell Cit Centree˜˜˜˜ ss aa ddEE nn aa ll ss II TT ii aa nn hh ee dd EE aa aa oo ss RR tt dd gg RR aa nn oo ii aa oo hh dd RR ooSS nn oo kk uu iiE€E€T Hong ‚T Hong ‚ongong tt aa ii TT TTaiaikkoooo HHuuii ll Tianhe RTianhe Roadoad nn aa WW€­­33 s€­­33 s hoing all­hoing all­ SS ttee ss eett ll eeaa ShiŠai‹iao StaShiŠai‹iao Stationtion rrnn ttdd ii SSss RR €­3­ s€­3­ s oooo aa nnHHddCitlaaCitlaa aa …… PP ii aa ‡‡ hoing all­hoing all­ ii RR ii ““ TTaikaikoo ioo i ee KingKing’s R’s Roadoad€0­8­8 s€0­8­8 s rr Quarry BayQuarry Bay anlitun ouanlitun outhth …… ii aa ‡‡ ii RR ii ““ ee tt rr ss StaStationtion ­0­ s ­0­ s WW€€ SS ee DeDevvon House on House Cambridge HouseCambridge HouseTTwwo To Taikaikoo Placeoo Place uu nn ee ““ 803 s803 s8 ­ s8 ­ s­­ s­­ sHKRI Taikoo Hui HKRI Taikoo Hui H‚„I TH‚„I Taikaikoo Huioo Hui H‚„I CentrH‚„I Centre “e “ †† SS hoing all­hoing all­ €€­0€ s€€­0€ s EE ……etretrororailail tt hhSS tt rr ee €€0 s€€0 s Bri’kBri’kell Staell Stationtion ee and HNGNand HNGN SS tt EE tt The iddle HouseThe iddle House hhSS tt rr ee H‚„I CentrH‚„I Centre ’e ’ SS ee SH†‚—H†ISH†‚—H†I „„esidencesesidences WW88 tt tt The ilvThe ilveri eri One CitgaOne Citgattee‡o‡ovvoottel Citgael Citgatte Hong ‚e Hong ‚ongong €  3 s€  3 s ­­0 s­­0 s inoino‘Ocean T‘Ocean Taikaikoo ioo i The TThe Temle Houseemle House hhSS tt Sino-OceanSino-Ocean rr ee ee ChengChengdudu ee tt Hong ‚Hong ‚ong –ong –€0 s€0 s3 8 s3 8 s ­­­€ s­­­€ s uu CitygateCitygate nn ee ““ ii †† SS hoing Centrhoing Centree­­ ‡‡ EE aa †aller †aller The ukhoThe ukhothai thai ii Taikoo LiTaikoo Li …… tt hh hh tt uu SS €3€3 s€3€3 s oo tt €3€­ s€3€­ s SS rr hanghaihanghai ee The iddleThe iddle ee SS tt HouseHouse  s s ChengduChengdu WW­­ tt ˆˆuuturturee €€€8€ s€€€8€ s dd hhSS ……etretro‡o“ero‡o“er aa tt oo rr DeDevvelomenteloment dd CHE‚—‘˜CHE‚—‘˜ ii RR ee Eighth StrEighth Streeteet aa ss ee ii aa oo ’’ tt ”” aa aa RR ‘‘ ll ll PP StaStationtion ll ˆ€€0000 sˆ€€0000 s gg ee kk ’’ nn ii ii rr ¢¢ BB nn aa ‚‚ tt ss ee ‚or‚orth ƒantau High„th ƒantau High„ayay WW ddaaoo TT RR iiaa aa tt TT uu hh nn ii ggRR oo ee aa dd WW E€E€T iamiT iami—— ThrThree Brickee Brickell Cit Centrell Cit Centree˜˜˜˜ Shi‡enyi RShi‡enyi Roadoad WWest ‚an¢ingest ‚an¢ing gg RRoad Staoad Stationtion nn uu hh ggCC nn uu ……TT ee ¤¤ ii TT ›› uu nnnn iioo tt aa tt ggSSSS ™H†‚—–˜™H†‚—–˜†‚†‚ „ith gr „ith gross loor aross loor areea o a o ™H€‡†šŽ™H€‡†šŽ€‡€‡ tt rr ee ee ttCitgaCitgatte Oue Outletstlets €3­ s ¥in’€3­ s ¥in’luding ’ar Šarking sŠa’luding ’ar Šarking sŠa’eses¦ ¦ ‰‰‰‰ TT„o Bri’k„o Bri’kell City Centrell City Centre and Thre and Three Bri’kee Bri’kell City Centrell City Centre „ere „ere sold in 00¡ e sold in 00¡ 8038 s8038 s is oŠeris oŠeraatted and ‡anaged and ‡anaged Ÿy a ¢oint “entured Ÿy a ¢oint “enture e The oi’The oi’e te to„ers aro„ers are no„ ‡anage no„ ‡anaged Ÿy S„ired Ÿy S„ire Pre ProŠeroŠerties¡ties¡ „hi’h is 0ž o„ned Ÿy S„ir„hi’h is 0ž o„ned Ÿy S„ire Pre ProŠeroŠerties¡ ties¡ ££ E†SE†ST …ia‡i „T …ia‡i „as sold in 0€¡ The hotas sold in 0€¡ The hotel and serel and ser“i’“i’ed aŠared aŠart‡ents art‡ents are still ‡anage still ‡anaged Ÿy S„ired Ÿy S„ire Hote Hotels¡els¡ S„irS„ire Pre ProŠeroŠerties doties does not ha“e an es not ha“e an WWest ‚an¢ing Rest ‚an¢ing Road Staoad Stationtion o„nershiŠ into„nershiŠ intererest in the ’o‡Šound¡ est in the ’o‡Šound¡ ChunŽi RChunŽi Road Staoad Stationtion ThrThree Pacifee Pacific Placeic PlaceThe Žer HouseThe Žer HouseOne One Conrad Hong ‚Conrad Hong ‚ongongIsland hangri‘a Island hangri‘a aciic laceaciic lace  s  s€8 38 s€8 38 sPacifPacific Placeic Place­0 s­0 sHong ‚Hong ‚ongong TT€„ €„ TŽDIOTŽDIO‰ƒ arrio‰ƒ arriottt t 83 s83 s0 8 s0 8 s  3 s 3 sHong ‚Hong ‚ongong ­0 s­0 s INDIGOINDIGO EI†HT EI†HT TT€„ €„ T„EET„EETT I‡DI†O Phase TI‡DI†O Phase Twwoo E€E€T Bei–ingT Bei–ing O‡E I‡DI†OO‡E I‡DI†O Taikoo LiTaikoo Li €38 s€38 s‰‰ BEIŒI‚—BEIŒI‚— Žnder DeŽnder Devvelomenteloment­ ­ 3830€ s3830€ s 8­0 € s8­0 € s PP€€CEŠ ‹Œ„ECEŠ ‹Œ„E ˆ0€ sˆ0€ s QiantanQiantan TTaikaikoo i Œiantan oo i Œiantan 8€3 s8€3 s SH†‚—H†ISH†‚—H†I hoing Centrhoing Centree­ ­ €€88  s€€88  s ’‹ Henness „’‹ Henness „oadoad TTo be ro be renamed asenamed as HH ˆivˆive Pacife Pacific Placeic Place­­ee nn nn ee ss ss •riental SŠor•riental SŠorts ts yyRR d oo d aa dd a a o o R R oo aa €3­0 s€3­0 s ii dd ‹‹ CentCenter Staer Stationtion QQ nn aa uu aa ee ii ee nn ŽŽ ‚ot‚otesœ esœ ss „„ oo aa uu yy ii ††d‡ird‡iralty alty ŒŒ uuRR ix Pacifix Pacific Placeic PlaceStaStationtion yy gg —r—ross loor aross loor areea iga igurures ares are sho„n on a €00ž Ÿasis¡e sho„n on a €00ž Ÿasis¡ nn oo ‰‰šloor aršloor areea sho„n in’a sho„n in’luding the luding the Žnder DeŽnder Devvelomenteloment­­ThrThree Pacifee Pacific Placeic PlacePacifPacific Placeic PlacePP€€CIˆIC PCIˆIC P€€CECETwTwoo ‘‘ dd These diagrThese diagra‡s ara‡s are not te not to s’ale and aro s’ale and are e or illustror illustraation Šurtion ŠurŠoses only¡Šoses only¡ aa oo tt RR ss ee I‡DI†OI‡DI†O ii WW ss gg nn aa grgross loor aross loor areea o ra o re‡aining e‡aining ˆ3303 sˆ3303 sPPedestrian inkedestrian inkhoing all­hoing all­€P€P€„€„TT E‡T E‡TPacifPacific Placeic Place hoing all­ hoing all­ ŒiangŒiangtai Statai Stationtion –– These diagrThese diagra‡s illustra‡s illustraatte the ‡ae the ‡a¢or de“eloŠ‡ents o S„ir¢or de“eloŠ‡ents o S„ire Pre ProŠeroŠerties¡ šor details o other de“eloŠ‡entsties¡ šor details o other de“eloŠ‡ents rresidential units o €08€ sesidential units o €08€ s¡ ¡ BeloBelow †rw †roundound­­ €€€8 s €€€8 s30  s30  s­€0 s­€0 s ­ ­ s­ ­ s ŠleŠlease rase reeer ter to the S’hedule o Prin’iŠal —ro the S’hedule o Prin’iŠal —rouŠ ProuŠ ProŠeroŠerties on Šagties on Šages 0 tes 0 to €¡o €¡

HO‡† ‚O‡†HO‡† ‚O‡†CHI‡EE €I‡€‡DCHI‡EE €I‡€‡D ŽŠŠ€ŠŽŠŠ€Š Taikoo laceTaikoo laceOne TOne Taikaikoo Placeoo PlaceOxOxfforord Housed HouseTaikoo HuiTaikoo HuiTTaikoaikooo HHuuiiTToowweerrs s ““””’’Taikoo LiTaikoo Li TTaikaikoo ioo i Brickell City CentreBrickell City Centre €0€338 s€0€338 s0€3 s0€3 s€­3€ s€­3€ s anlitun ‡oranlitun ‡orthth and City la­aand City la­aOne Island EastOne Island East——˜˜†‚—™H•˜†‚—™H•˜SanlitunSanlitun ­3 s­3 s …I†…I šƒ•RI‘†…I†…I šƒ•RI‘† PCCPCCƒ Tƒ ToowwererBerkshirBerkshiree€3 0€€ s€3 0€€ s a annddaaririnn Ori Orieentalntal•• 0€8 s0€8 sHouseHouse††uuaanngghhoouuBEIŒI‚—BEIŒI‚— DorDorset Houseset House388838 s388838 s0­3 0­3 ss TTaikaikoo i anlitun ƒoo i anlitun ƒestest 0­0 s0­0 seerrvviced €iced €artmeartmentntss ­30 s­30 s BrickBrickell Cit Centrell Cit Centree incoln Houseincoln House03 03  ss hoing all­hoing all­ 333­ s333­ s ­08 s­08 s E€E€T T 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FINANCIAL REVIEW References are to “Notes to the Financial Statements” on pages 139 to 197. Consolidated Statement of Profit or Loss 2022 2021 HK$M HK$M Reference Restated Revenue 13,826 16,318 Note 4 The decrease in revenue of HK$2,492 million compared to 2021 was principally due to lower revenue from property trading and hotels, and lower gross rental income from property investment. Revenue from property trading decreased by HK$1,522 million from 2021. In 2022, revenue was recognised from the sale of 27 EIGHT STAR STREET units in Hong Kong and a property in Fort Lauderdale in Florida, U.S.A. In 2021, revenue was recognised from the sale of 20 EDEN units in Singapore and from 25 Reach units and 89 Rise units in Miami, U.S.A. Revenue from hotels decreased by HK$329 million, mainly due to loss of hotel revenue from EAST Miami (which was disposed of in the second half of 2021) and lower hotel revenue in the Chinese Mainland as a result of COVID-19 related travel restriction. Gross rental income from property investment decreased by HK$653 million. In Hong Kong, gross rental income decreased by HK$367 million mainly due to lower office rental income reflecting a weak office market with increased supply and economic uncertainty, and lower retail rental income which was suffered from disruption in the early part of 2022 by the fifth COVID-19 wave and related social distancing measures. In the Chinese Mainland, gross rental income decreased by HK$186 million, mainly reflecting the adverse impact from COVID-19 resurgence and depreciation of Renminbi, partly offset by a full year contribution from Taikoo Li Sanlitun West. In the U.S.A., gross rental income decreased, mainly due to loss of rental income from serviced apartments in Miami which was disposed of in the second half of 2021. 74

Consolidated Statement of Profit or Loss (continued) 2022 2021 HK$M HK$M Reference Restated Gross Profit 9,523 10,517 Gross profit decreased by HK$994 million. Gross profit from property investment, property trading and hotels decreased by HK$576 million, HK$287 million and HK$131 million respectively. Gross profit from property investment decreased by HK$576 million, mainly due to lower profits from the office properties in Hong Kong and from the retail properties (reflecting in part the rental concessions given to retail tenants) in the Chinese Mainland. Gross profit from property trading reflected the recognition of profits on the sale of EIGHT STAR STREET units in Hong Kong and a property in Fort Lauderdale in Florida, U.S.A. Hotel business recorded a loss of HK$120 million in 2022 compared with a gross profit of HK$11 million in 2021, mainly due to loss of hotel revenue from EAST Miami in the U.S.A. and lower hotel revenue in the Chinese Mainland. Operating Profit 9,024 7,834 Notes 6 The increase in operating profit of HK$1,190 million was principally and 8(a) due to a net valuation gain on investment properties in 2022 (compared with a net valuation loss in 2021), partly offset by lower profits from property investment and on sale of interests in investment properties in Hong Kong. A net valuation gain on investment properties of HK$801 million was recorded in 2022, compared with a net valuation loss of HK$1,947 million in 2021. Investment properties in Hong Kong recorded a net valuation loss of HK$1,127 million, principally due to lower rents. Investment properties in the Chinese Mainland recorded a net valuation gain of HK$1,539 million, principally due to a reduction of 25 to 50 basis points in the capitalisation rates applicable to certain investment properties in the portfolio. The investment properties at Brickell City Centre in Miami, U.S.A. recorded a valuation gain of HK$389 million, mainly due to higher rents. Administrative and selling expenses decreased by HK$175 million compared to 2021. The decrease principally reflected lower project related costs in 2022. 75 SWIRE PROPERTIES ANNUAL REPORT 2022

MANAGEMENT DISCUSSION & ANALYSIS | FINANCIAL REVIEW Consolidated Statement of Profit or Loss (continued) 2022 2021 HK$M HK$M Reference Restated Net Finance Charges 187 377 Note 10 The reduction of HK$190 million principally reflected an increase in interest capitalised on investment properties and properties for sale in Hong Kong and the Chinese Mainland. Share of Profit Less Losses of Joint Venture Companies 1,443 1,868 Note 8(a) The decrease of HK$425 million principally reflected the reduction in net valuation gain of HK$304 million. Taxation 2,065 1,964 Note 11 The increase of HK$101 million was principally due to an increase in deferred tax in relation to valuation gain in respect of investment properties in the Chinese Mainland and the U.S.A., and profit on the sale of property in the U.S.A. Profit Attributable to the Company’s Shareholders 7,980 7,112 Note 8(a) The increase of HK$868 million reflected a net valuation gain on investment properties in 2022 (compared with a net valuation loss in 2021), partly offset by lower profits from property investment and on sales of interests in investment properties. 76

Consolidated Statement of Financial Position 2022 2021 HK$M HK$M Reference Restated Property, Plant and Equipment 3,165 3,381 Note 15 The decrease in property, plant and equipment was principally due to depreciation for the year and foreign exchange translation losses (principally in respect of leasehold buildings in the Chinese Mainland), partly offset by additions to plant and equipment. Investment Properties 271,368 267,959 Note 16 The increase in investment properties of HK$3,409 million was principally due to additions during the year (after netting off cost written back) of HK$7,321 million and a net valuation gain of HK$801 million, partly offset by foreign exchange translation losses of HK$3,449 million, the disposals of Taikoo Shing car parking spaces and a property in Tsing Yi, Hong Kong of HK$825 million, and the transfer of unsold Taikoo Shing car parking spaces of HK$474 million to assets classified as held for sale. The additions reflected capital expenditure at the Taikoo Place redevelopment, Taikoo Li Xi’an, and other projects in Hong Kong and the Chinese Mainland. The foreign exchange translation losses were principally in respect of investment properties in the Chinese Mainland. Joint Venture Companies and Loans Due from 39,862 37,554 Note 20 Joint Venture Companies The increase of HK$2,308 million principally reflected (i) increases in equity to joint venture companies, (ii) the Company’s share of profits of joint venture companies (including valuation gains) and (iii) the acquisition of additional interests in joint venture companies, partly offset by (iv) the Company’s share of foreign exchange translation losses in respect of joint venture companies in the Chinese Mainland and (v) movements in loans due from joint venture companies. Other Financial Assets at Amortised Cost – 522 Note 32 The decrease of HK$522 million mainly reflected the reclassification of a deferred payment to trade and other receivables since it is due within one year. Properties For Sale 8,264 6,411 Note 23 The increase of HK$1,853 million principally reflected the acquisition cost of 269 Queen’s Road East, Wan Chai and development expenditures of Chai Wan Inland Lot No. 178 in Hong Kong, partly offset by sales of units at EIGHT STAR STREET in Hong Kong and a property at Fort Lauderdale in Florida, U.S.A. 77 SWIRE PROPERTIES ANNUAL REPORT 2022

MANAGEMENT DISCUSSION & ANALYSIS | FINANCIAL REVIEW Consolidated Statement of Financial Position (continued) 2022 2021 HK$M HK$M Reference Restated Trade and Other Receivables 2,834 2,220 Note 24 The increase of HK$614 million mainly reflected the reclassification of a deferred payment from other financial assets at amortised cost since it is due within one year. Assets Classified as Held For Sale 2,038 1,740 Note 33 This represents 1,078 car parking spaces at Taikoo Shing, Hong Kong. Trade and Other Payables 10,008 9,339 Note 27 The increase of HK$669 million principally reflected a payment obligation related to the acquisitions of joint venture companies, partly offset by a decrease in accrued capital expenditure and a decrease in interest-bearing advances from joint venture companies. Long-Term Loans and Bonds 22,835 24,601 Note 29 (including the component due within one year) The decrease of HK$1,766 million was principally due to the repayment of medium term notes, partly offset by the drawdown of bank loans in Hong Kong. Deferred Tax Liabilities 11,248 10,746 Note 31 The increase of HK$502 million principally reflected deferred tax in respect of valuation gains on investment properties in the Chinese Mainland and the U.S.A., partly offset by foreign exchange translation losses in the Chinese Mainland. Equity Attributable to the Company’s Shareholders 289,211 291,624 Notes The decrease in equity attributable to the Company’s shareholders 35 and 36 represents the total comprehensive income for the year attributable to the Company’s shareholders (HK$3,203 million), as reduced by dividends paid to the Company’s shareholders. Non-Controlling Interests 3,047 1,986 Note 38 The increase in non-controlling interests of HK$1,061 million mainly reflected capital contribution from an owner of non-controlling interest and profits earned by the owners of non-controlling interests, partly offset by foreign exchange translation losses in respect of entities in which there are non-controlling interests and dividends paid to the owners of non-controlling interests. 78

Consolidated Statement of Cash Flows 2022 2021 HK$M HK$M Reference Cash Generated from Operations 6,332 7,028 Note 43(a) Cash generated from operations of HK$6,332 million principally comprised cash inflows from property investment of approximately HK$9,220 million and from property trading of approximately HK$803 million, partly offset by operating expenses of approximately HK$1,402 million and expenditure on properties for sale of approximately HK$2,194 million (after netting off contribution from a non-controlling interest). Tax Paid 1,127 1,635 The decrease principally reflected less tax paid in Hong Kong. Purchase of Property, Plant and Equipment 133 180 Note 43(b) The decrease principally reflected less additions of plant and equipment in Hong Kong. Additions of Investment Properties 7,096 3,860 The amount in 2022 principally reflected capital expenditure on the Taikoo Place redevelopment, Taikoo Li Xi’an and on other projects in Hong Kong and the Chinese Mainland. Proceeds from Disposal of Subsidiary Companies, Net of Cash 1,060 212 Note 43(c) Disposed of The amount in 2022 reflected the proceeds from disposal of subsidiary company holding certain properties in Hong Kong. Proceeds from Disposal of Property, Plant and Equipment and 609 3,758 Investment Properties The amount in 2022 reflected the proceeds from sales of Taikoo Shing car parking spaces in Hong Kong. Purchase of Shares in Joint Venture Companies, Equity and 2,034 4,160 Loans (Net of Repayment) to Joint Venture Companies The amount in 2022 principally reflected purchase of shares and equity injected in joint venture companies of HK$1,720 million and HK$1,123 million respectively and net movements of loans with joint venture companies. Repayment of Loans, Bonds and Lease Liabilities (Net of Loans 1,838 2,856 Drawn and Refinancing) The amount in 2022 principally reflected the repayment of medium term notes, partly offset by the drawdown of bank loans in Hong Kong. 79 SWIRE PROPERTIES ANNUAL REPORT 2022

MANAGEMENT DISCUSSION & ANALYSIS | FINANCIAL REVIEW Investment Appraisal and Performance Review Net Assets Employed Capital Commitments(1) 2022 2021 2022 2021 HK$M HK$M HK$M HK$M Restated Property investment 293,752 288,246 27,402 20,276 Property trading 11,612 9,637 – – Hotels 5,841 6,061 552 408 Total net assets employed 311,205 303,944 27,954 20,684 Less: net debt (18,947) (10,334) Less: non-controlling interests (3,047) (1,986) Equity attributable to the Company’s shareholders 289,211 291,624 Equity Attributable to the Return on Average Equity Attributable to the Company’s Company’s Shareholders(2) Shareholders(2) 2022 2021 HK$M HK$M 2022 2021 Restated Restated Property investment 279,688 281,050 2.9% 2.4% Property trading 3,992 4,771 3.9% 13.3% Hotels 5,531 5,803 -6.0% -5.2% Total 289,211 291,624 2.7% 2.5% (1) The capital commitments represent the Group’s capital commitments plus the Group’s share of the capital commitments of joint venture companies. (2) Refer to Glossary on page 215 for definitions. 80

FINANCING • Capital Structure The Group considers a number of factors in monitoring • Medium Term Note Programme its capital structure, which principally include the • Changes in Financing gearing ratio, cash interest cover and the return cycle • Net Debt of its investments. • Sources of Finance – Loans and Bonds Medium Term Note Programme – Bank Balances and Short-term Deposits In 2012, Swire Properties MTN Financing Limited, a • Maturity Profile and Refinancing wholly-owned subsidiary of the Company, established • Currency Profile a US$3 billion Medium Term Note (“MTN”) • Finance Charges Programme. The aggregate nominal amount of the • Gearing Ratio and Interest Cover MTN Programme was increased to US$4 billion in 2017. • Capital Management Notes issued under the MTN Programme are • Attributable Net Debt unconditionally and irrevocably guaranteed by the • Debt in Joint Venture and Associated Companies Company. At 31st December 2022, the MTN Capital Structure Programme was rated A by Fitch and (P)A2 by Moody’s, in each case in respect of notes with a The Group aims to maintain a capital structure which maturity of more than one year. enables it to invest in and finance projects in a disciplined The MTN Programme enables the Group to raise and targeted manner. money directly from the capital markets. Under the The Group’s primary objectives when managing capital are MTN Programme, notes may be issued in US dollars to safeguard the Group’s ability to operate as a going or in other currencies, in various amounts and for concern, so that it can continue to provide returns for various tenors. shareholders, and to secure access to finance at a reasonable cost. 81 SWIRE PROPERTIES ANNUAL REPORT 2022

MANAGEMENT DISCUSSION & ANALYSIS | FINANCING Changes in Financing Audited Financial Information During the year, the Group raised approximately HK$15,309 million. This comprised: • term and revolving loan facilities aggregating HK$11,800 million • refinancing of term and revolving loan facilities aggregating US$450 million During the year, the Group made various repayments of debt. This comprised: • repayment and prepayment of term and revolving loan facilities aggregating HK$5,110 million • repayment of medium term notes of US$500 million Loans and bonds due within due after Lease Total one year one year liabilities 2022 2021 HK$M HK$M HK$M HK$M HK$M At 1st January 9,000 15,601 566 25,167 27,837 Loans drawn and refinanced 500 6,737 – 7,237 1,400 Bonds matured (3,899) – – (3,899) (300) Repayment of loans (5,110) – – (5,110) (3,884) New leases arranged during the year – – 160 160 51 Principal elements of lease payments – – (66) (66) (72) Reclassification 199 (199) – – – Currency adjustment 1 1 (46) (44) 99 Other non-cash movements 9 (5) – 4 36 At 31st December 700 22,135 614 23,449 25,167 Net Debt Audited Financial Information Net debt at 31st December 2022 was HK$18,947 million, compared with HK$10,334 million at 31st December 2021. The increase in net debt principally reflected capital and development expenditure in Hong Kong and the Chinese Mainland. The Group’s borrowings are principally denominated in Hong Kong dollars and US dollars. Outstanding borrowings at 31st December 2022 and 2021 were as follows: 2022 2021 HK$M HK$M Borrowings included in non-current liabilities Bank borrowings – unsecured 7,311 588 Bonds – unsecured 14,824 15,013 Borrowings included in current liabilities Bank borrowings – unsecured 500 5,102 Bonds – unsecured 200 3,898 Total borrowings 22,835 24,601 Lease liabilities Included in non-current liabilities 535 517 Included in current liabilities 79 49 Less: short-term deposits and bank balances 4,502 14,833 Net debt 18,947 10,334 82

Sources of Finance Audited Financial Information At 31st December 2022, committed loan facilities and debt securities amounted to HK$32,870 million, of which HK$9,890 million (30%) remained undrawn. In addition, the Group had undrawn uncommitted facilities totalling HK$400 million. Sources of funds at 31st December 2022 comprised: Undrawn Undrawn Expiring Expiring Within After Available Drawn One Year One Year HK$M HK$M HK$M HK$M Facilities from third parties Term loans 5,069 3,479 – 1,590 Revolving loans 12,740 4,440 – 8,300 Bonds 15,061 15,061 – – Total committed facilities 32,870 22,980 – 9,890 Uncommitted facilities Bank loans and overdrafts 400 – 400 – Total 33,270 22,980 400 9,890 Note: The figures above are stated before unamortised loan fees of HK$145 million. i) Loans and Bonds Audited Financial Information For accounting purposes, loans and bonds are classified as follows: 2022 2021 Drawn, Before Drawn, Before Unamortised Unamortised Carrying Unamortised Unamortised Carrying Loan Fees Loan Fees Value Loan Fees Loan Fees Value HK$M HK$M HK$M HK$M HK$M HK$M Long-term loans and bonds at amortised cost – unsecured 22,980 (145) 22,835 24,668 (67) 24,601 Less: amount due within one year included under current liabilities 700 – 700 9,008 (8) 9,000 22,280 (145) 22,135 15,660 (59) 15,601 ii) Bank Balances and Short-term Deposits The Group had bank balances and short-term deposits of HK$4,502 million at 31st December 2022, compared to HK$14,833 million at 31st December 2021. 83 SWIRE PROPERTIES ANNUAL REPORT 2022

MANAGEMENT DISCUSSION & ANALYSIS | FINANCING Maturity Profile and Refinancing Bank loans and other borrowings are repayable on various dates up to 2030 (2021: up to 2030). The weighted average term and cost of the Group’s debt are: 2022 2021 Weighted average term of debt 3.9 years 3.0 years Weighted average cost of debt 3.2% 3.0% Note: The weighted average cost of debt above is stated on gross debt basis. The maturity profile of the Group’s available committed facilities is set out below: TOTAL AVAILABLE HK$M COMMITTED 15,000 FACILITIES BY MATURITY 12,000 9,000 Facilities from third parties 6,000 Term and revolving loans 3,000 Bonds 0 2023 2024 2025 2026 2027 2028 2029 2030 Audited Financial Information The table below sets forth the maturity profile of the Group’s borrowings: 2022 2021 HK$M HK$M Bank borrowings and bonds from third parties due Within 1 year 700 3% 9,000 37% 1-2 years 1,875 8% 199 1% 2-5 years 15,195 67% 8,207 33% After 5 years 5,065 22% 7,195 29% Total 22,835 100% 24,601 100% Less: Amount due within one year included under current liabilities 700 9,000 Amount due after one year included under non-current liabilities 22,135 15,601 84

Currency Profile Audited Financial Information An analysis of the carrying amounts of gross borrowings by currency (after cross-currency swaps) is shown below: 2022 2021 HK$M HK$M Currency Hong Kong dollars 19,740 86% 20,747 84% United States dollars 3,095 14% 3,854 16% Total 22,835 100% 24,601 100% Finance Charges Audited Financial Information An analysis of outstanding borrowings by reference to whether they bear interest at fixed or floating rates is shown below: 2022 2021 HK$M HK$M Fixed 15,061 66% 20,518 83% Floating 7,919 34% 4,150 17% Sub-total 22,980 100% 24,668 100% Less: Unamortised loan fee 145 67 Total 22,835 24,601 The exposure of the Group’s borrowings to fixed and floating interest rates can be illustrated as follows: Fixed Interest Rates Maturing in: Floating Interest 1 Year 1 to 5 Over 5 Rates or Less Years Years Total HK$M HK$M HK$M HK$M HK$M At 31st December 2022 7,811 200 9,759 5,065 22,835 At 31st December 2021 4,132 5,456 7,818 7,195 24,601 85 SWIRE PROPERTIES ANNUAL REPORT 2022

MANAGEMENT DISCUSSION & ANALYSIS | FINANCING Audited Financial Information (continued) Interest charged and earned during the year was as follows: 2022 2021 HK$M HK$M Interest charged on: Bank loans and overdrafts 158 61 Bonds 559 651 Interest-bearing advances from joint venture companies 16 9 Lease liabilities 19 18 Net fair value (gains)/losses on derivative instruments Cash flow hedges – transferred from other comprehensive income (13) 14 Cross-currency swaps not qualifying as hedges 1 1 Other financing costs 109 131 849 885 Losses on the movement in the fair value of the liability in respect of a put option in favour of the owner of a non-controlling interest 66 64 Capitalised on: Investment properties (370) (293) Properties for sale (186) (49) 359 607 Interest income on: Short-term deposits and bank balances (105) (135) Loans to joint venture and associated companies (51) (79) Others (16) (16) (172) (230) Net finance charges 187 377 The capitalised interest rates on funds both borrowed generally and used for the development of investment properties and properties for sale were between 2.9% and 3.7% per annum (2021: 3.3% and 3.4% per annum). The amount transferred from other comprehensive income in respect of cash flow hedges in 2022 includes HK$12 million (2021: HK$4 million) relating to currency basis. The interest rates per annum (after cross-currency swaps) at 31st December were as follows: 2022 2021 HKD USD HKD USD % % % % Long-term loans and bonds 2.3-5.7 5.1-5.2 0.8-4.4 0.8-2.9 86

Audited Financial Information (continued) Benchmark interest rates like London interbank offered rate (LIBOR) are being replaced. The cash flows of the Company and its subsidiaries primarily affected are those associated with US dollar denominated variable interest rate facilities which reference LIBOR. These facilities had principal amounts equivalent in aggregate to HK$2,339 million at 31st December 2022. The uncertainty arising from the Group’s exposure to interbank offered rates (IBOR) will cease in 2023. Other variable interest rate facilities of the Company and its subsidiaries are not referenced to rates which are being replaced. Gearing Ratio and Interest Cover The following graphs illustrate the gearing ratio and underlying interest cover for each of the last five years: GEARING RATIO HK$M Ratio (%) 350,000 35 300,000 30 250,000 25 200,000 20 Total equity 150,000 15 Net debt 100,000 10 50,000 5 Gearin ratio 0 0 2018 2019 2020 2021 2022 (Retated) (Retated) UNDERLYING HK$M Times INTEREST COVER 28,000 112 24,000 96 Underlying operating profit 20,000 80 et finane arges 16,000 64 12,000 48 apitalised interest 8,000 32 4,000 16 Underlying interest oer Underlying as interest oer 0 0 2018 2019 2020 2021 2022  estated­  estated­ SWIRE PROPERTIES ANNUAL REPORT 2022 87

MANAGEMENT DISCUSSION & ANALYSIS | FINANCING 2022 2021 Restated Gearing ratio (1) 6.5% 3.5% (1) Interest cover – times Per financial statements 48.3 20.8 Underlying 74.7 33.0 (1) Cash interest cover – times Per financial statements 12.1 10.9 Underlying 13.4 15.8 (1) Refer to Glossary on page 215 for definitions. Capital Management Audited Financial Information The Group’s primary objectives when managing capital are to safeguard the Group’s ability to operate as a going concern, so that it can continue to provide returns for shareholders, and to secure access to finance at a reasonable cost. The Group considers a number of factors in monitoring its capital structure, which principally include the gearing ratio, cash interest cover and the return cycle of its investments. For the purpose of the gearing ratio, the Group defines net debt as total borrowings and lease liabilities less short-term deposits and bank balances. Capital comprises total equity, as shown in the consolidated statement of financial position. In order to maintain or adjust the gearing ratio, the Group may adjust the amount of dividends paid to shareholders, repurchase shares, raise new debt financing or sell assets to reduce debt. The gearing ratios at 31st December 2022 and 31st December 2021 were as follows: 2022 2021 HK$M HK$M Restated Total borrowings 22,835 24,601 Lease liabilities 614 566 Less: Short-term deposits and bank balances 4,502 14,833 Net debt 18,947 10,334 Total equity 292,258 293,610 Gearing ratio 6.5% 3.5% The Group has given certain covenants under facilities from third-parties, including maintenance of a minimum amount of tangible net worth. The Group has significant headroom on all covenants, and does not expect any breach in the foreseeable future. 88

Attributable Net Debt The chart below illustrates, by entity, the Group’s attributable net debt (in HK$ million): Swire Properties (436) Swire Properties (Finance) Swire Properties MTN 4,716 Financing 15,024 Consolidated Net Debt H.K. Chinese Mainland U.S.A. and other 18,947 Entities Entities Entities (278) (2,644) 2,565 H.K. Chinese Mainland U.S.A. and other Attributable JV/Asso JV/Asso JV/Asso Net Debt of Joint 3,472 7,532 461 Venture and Associated Companies (“JV/Asso”) 11,465 Debt in Joint Venture and Associated Companies In accordance with Hong Kong Financial Reporting Standards, the net debt of the Group reported in the consolidated statement of financial position does not include the net debt of its joint venture and associated companies. These companies had the following net debt positions at the end of 2022 and 2021: Net Debt of Portion of Net Debt Joint Venture and Attributable to Debt Guaranteed by Associated Companies the Group the Group 2022 2021 2022 2021 2022 2021 HK$M HK$M HK$M HK$M HK$M HK$M Hong Kong Entities 10,402 10,033 3,472 3,406 2,408 2,265 Chinese Mainland Entities 15,171 16,629 7,532 7,936 1,203 904 U.S.A. and other Entities 542 317 461 396 570 474 Total 26,115 26,979 11,465 11,738 4,181 3,643 If the attributable portion of the net debt in joint venture and associated companies were to be added to the Group’s net debt, gearing would rise to 10.4%. 89 SWIRE PROPERTIES ANNUAL REPORT 2022

Corporate Governance & Sustainability Taikoo Hui, Guangzhou

Sino-Ocean Taikoo Li Chengdu

CORPORATE GOVERNANCE Corporate and Governance Culture employees and others who deal with the Company to act Swire Properties is committed to ensuring that its affairs with honesty and integrity and to raise concerns about are conducted in accordance with its corporate and actual or suspected cases of impropriety. Indicators used governance culture and values of integrity, originality, for assessing and monitoring social and corporate excellence, humility, teamwork, continuity and high ethical governance-related data (including staff turnover rates, standards, which form a coherent set of principles that are whistleblowing data, employee surveys and breaches of relevant across the Company’s business and underpin the Company’s Corporate Code of Conduct) are set out in everything it does. This reflects its belief that, in the the Sustainable Development Report 2022 of the achievement of its long-term objectives, it is imperative to Company. The Group offers competitive remuneration and act with probity, transparency and accountability. By so benefits designed to attract, motivate and retain talented acting, Swire Properties believes that shareholder value will people at all levels. Having regard to the corporate culture be maximised in the long term and that its employees, reflected in the policies and practices of the Group, the those with whom it does business and the communities in Board is satisfied that the purpose, values and strategic which it operates will all benefit. directions of the Group are aligned with its culture. Corporate governance is the process by which the Board Corporate Governance Statement instructs management of the Group to conduct its affairs The Corporate Governance Code (the “CG Code”) as with a view to ensuring that its objectives are met. The published by The Stock Exchange of Hong Kong Limited Board is committed to maintaining and developing robust sets out the principles of good corporate governance and corporate governance practices that are intended provides two levels of recommendation: to ensure: • code provisions, with which issuers are expected to • satisfactory and sustainable returns to shareholders comply, but with which they may choose not to comply, • that the interests of those who deal with the Company provided they give considered reasons and explanations are safeguarded for non-compliance • that overall business risk is understood and managed • recommended best practices, with which issuers are appropriately encouraged to comply, but which are provided for • the delivery of high-quality products and services to the guidance only satisfaction of customers The Company supports the principles-based approach of • that high standards of ethics are maintained and the CG Code and the flexibility this provides for the • sustainable development of the business and the adoption of corporate policies and procedures which communities in which the Company operates with a recognise the individuality of companies. Swire Properties view to create long-term value has adopted its own corporate governance code which is The Board provides guidance to management by defining available on its website (www.swireproperties.com). the purpose, values and strategic direction of the Group, Corporate governance does not stand still; it evolves with and plays an important role in establishing and instilling a the business and operating environment. The Company is culture that reinforces the values of acting lawfully, always ready to learn and adopt best practices. ethically and responsibly. The Company’s Corporate Code The Company complied with all the code provisions set out of Conduct ensures that the corporate culture and in the CG Code contained in Part 2 of Appendix 14 to the expected behaviours are clearly communicated to Rules Governing the Listing of Securities on The Stock everyone in the Group. Appropriate policies and procedures Exchange of Hong Kong Limited (the “Listing Rules”) are in place to promote and reinforce the need for throughout the year covered by the annual report. 92

The Board of Directors Chairman and Chief Executive Role of the Board The CG Code requires that the roles of Chairman and Chief The Company is governed by a Board of Directors, which Executive be separate and not performed by the same has responsibility for strategic leadership and control of the individual to ensure there is a clear division of Group designed to maximise shareholder value, while responsibilities between the running of the Board and the taking due account of the interests of those with whom the executives who run the business. Group does business and others. G.M.C. Bradley, the Chairman, is responsible for: Responsibility for achieving the Company’s objectives and • leadership of the Board running the business on a day-to-day basis is delegated to • setting its agenda and taking into account any matters management. The Board exercises a number of reserved proposed by other Directors for inclusion in the agenda powers which include: • facilitating effective contributions from and dialogue with • maintaining and promoting the culture of the Company all Directors and constructive relations between them • formulation of long-term strategy • ensuring that all Directors are properly briefed on issues • approving public announcements, including financial arising at Board meetings and that they receive statements accurate, timely and clear information • committing to major acquisitions, divestments and • obtaining consensus amongst the Directors capital projects • ensuring, through the Board, that good corporate • authorising significant changes to the capital structure governance practices and procedures are followed and material borrowings T.J. Blackburn, the Chief Executive, is responsible for • any issue, or buy-back, of equity securities under the implementing the policies and strategies set by the Board relevant general mandates in order to ensure the successful day-to-day management • approving treasury policy of the Group’s business. • setting dividend policy Throughout the year, there was a clear division of • approving appointments to the Board responsibilities between the Chairman and the • ensuring that appropriate management development Chief Executive. and succession plans are in place • setting the Group remuneration policy Board Composition • approving annual budgets and forecasts The Board is structured with a view to ensuring it is of a • reviewing operational and financial performance high calibre and has a balance of skills, experience and • reviewing the effectiveness of the Group’s risk diversity of perspectives appropriate to the Company’s management and internal control systems business so that it works effectively as a team, and that • ensuring the adequacy of the resources, staff individuals or groups do not dominate any decision- qualifications and experience, training programmes and making. budget of the Company’s accounting, internal audit, The Board comprises the Chairman, three other Executive financial reporting and environmental, social and Directors and nine Non-Executive Directors. Their governance (“ESG”) functions biographical details are set out in the section of this annual • overseeing sustainable development matters report headed Directors and Officers and are posted on the To assist it in fulfilling its duties, the Board has three Company’s website. primary committees, the Audit Committee (see pages 103 T.J. Blackburn, G.M.C. Bradley, F.N.Y. Lung, M.S.C. Ma and to 104), the Nomination Committee (see pages 100 to 101) M.J. Murray are directors and/or employees of the John and the Remuneration Committee (see page 101). Swire & Sons Limited (“Swire”) group. N.A.H. Fenwick and M.B. Swire are shareholders, directors and/or employees of and R.S.K. Lim is an adviser to the Swire group. 93 SWIRE PROPERTIES ANNUAL REPORT 2022

CORPORATE GOVERNANCE & SUSTAINABILITY | CORPORATE GOVERNANCE The Non-Executive Directors bring independent advice, Board. The Nomination Committee, a majority of which is judgement and, through constructive challenge, scrutiny of comprised of Independent Non-Executive Directors, executives and review of performance and risks. The Audit, assesses the suitability and independence of potential Nomination and Remuneration Committees of the Board candidates to be appointed as Independent Non-Executive comprise only Non-Executive Directors. Directors and reviews the independence of each The Board considers that five of the nine Non-Executive Independent Non-Executive Director annually. The Directors are independent in character and judgement and Independent Non-Executive Directors meet with the fulfil the independence guidelines set out in Rule 3.13 of Chairman at least once annually without the presence of the Listing Rules. S.T. Fung has served as an Independent other Directors and they can interact with management Non-Executive Director for more than nine years. The and other Directors including the Chairman through formal Directors are of the opinion that he remains independent, and informal means. Independent professional advice is notwithstanding his length of tenure. S.T. Fung continues to also available to all Directors whenever necessary. A review demonstrate the attributes of an Independent Non- of these mechanisms is conducted on an annual basis to Executive Director noted above and there is no evidence ensure their effectiveness. that his tenure has had any impact on his independence. Responsibilities of Directors The Board believes that his detailed knowledge and On appointment, the Directors receive information about experience of the Group’s business and his external the Group including: experience continue to be of significant benefit to the Company, and that he maintains an independent view of • the role of the Board and the matters reserved for its its affairs. attention Confirmation has been received from all Independent • the role and terms of reference of Board Committees Non-Executive Directors that they are independent as set • the Group’s corporate governance practices and out in Rule 3.13 of the Listing Rules. None of the procedures Independent Non-Executive Directors holds cross- • the powers delegated to management and directorships or has significant links with other Directors • the latest financial information through involvements in other companies or bodies. Directors update their skills, knowledge and understanding The Independent Non-Executive Directors: of the Company’s businesses through their participation at meetings of the Board and its committees and through • provide open and objective challenge to management regular meetings with management at the head office and and other Board members in the divisions. Directors are regularly updated by the • raise intelligent questions and challenge constructively Company Secretary on their legal and other duties as and with vigour Directors of a listed company. • bring outside knowledge of the businesses and markets Through the Company Secretary, Directors are able to in which the Group operates, providing informed insight obtain appropriate professional training and advice. and responses to management The number of Independent Non-Executive Directors Each Director ensures that he/she can give sufficient time represents at least one-third of the Board of Directors. and attention to the affairs of the Group. All Directors disclose to the Board on their first appointment their Taking into account all of the circumstances described in interests as a Director or otherwise in other companies or this section, the Company considers all of the Independent organisations and such declarations of interests are Non-Executive Directors to be independent. updated regularly. No Director was a director of more than The Company has in place effective mechanisms to ensure two other listed companies (excluding the Company) at that independent views and input are available to the 31st December 2022. 94

OTHER LISTED COMPANY DIRECTORSHIPS 2 Number of Companies 1 0 0 2 4 6 8 Number of Directors Details of Directors’ other appointments are shown in Board decisions are made by vote at Board meetings and their biographies in the section of this annual report supplemented by the circulation of written resolutions headed Directors and Officers. between Board meetings. Board Processes Minutes of Board meetings are taken by the Company All committees of the Board follow the same processes Secretary and, together with any supporting papers, are as the full Board. made available to all Directors. The minutes record the matters considered by the Board, the decisions reached, The dates of the 2022 Board meetings were determined and any concerns raised or dissenting views expressed by in 2021 and any amendments to this schedule were Directors. Draft and final versions of the minutes are sent to notified to Directors at least 14 days before regular all Directors for their comment and records respectively. meetings. Appropriate arrangements are in place to Board meetings are structured so as to encourage open allow Directors to include items in the agenda for regular discussion, frank debate and active participation by Board meetings. Directors in meetings. The Board met seven times in 2022, including two A typical Board meeting would consist of: strategy sessions. The attendance of individual Directors at meetings of the Board and its committees is set out in • review of the health and safety performance the table on page 96. Attendance at Board meetings was • review of the operating environment for the business 100%. All Directors attended Board meetings in person and of the most recent financial results and outlook or through electronic means of communication during • review of the development progress of new investments the year. • review and discussion of longer term financial plans, Agendas and accompanying Board papers are circulated including a discussion of capital allocation and with sufficient time to allow the Directors to prepare investment plans before meetings. • presentation of papers to support decisions requiring Board approval The Chairman takes the lead to ensure that the Board • an update on sustainability and ESG matters acts in the best interests of the Company, that there is • an update of legal and compliance matters for the effective communication with the shareholders and that Board’s consideration their views are communicated to the Board as a whole. • any declarations of interest 95 SWIRE PROPERTIES ANNUAL REPORT 2022

CORPORATE GOVERNANCE & SUSTAINABILITY | CORPORATE GOVERNANCE Directors meet at least once annually to discuss the Company’s strategy, including investment and divestment plans and other strategic initiatives. The strategy sessions also serve as platforms for raising new initiatives and ideas. The executive management provides the Board with such information and explanations as are necessary to enable Directors to make an informed assessment of the financial and other information put before the Board. Queries raised by Directors are answered fully and promptly. When necessary, the Independent Non-Executive Directors meet privately to discuss matters which are their specific responsibility. The Chairman meets at least annually with the Independent Non-Executive Directors without the presence of other Directors. Continuous Professional Meetings Attended/Held Development 2022 Annual Type of Audit Nomination Remuneration General Training Directors Board Committee Committee Committee Meeting (Notes) Executive Directors G.M.C. Bradley – Chairman 7/7 √ A, B T.J. Blackburn 7/7 √ A, B F.N.Y. Lung 7/7 √ A, B M.S.C. Ma 7/7 √ A, B Non-Executive Directors N.A.H. Fenwick 7/7 2/2 2/2 √ A, B R.S.K. Lim 7/7 √ A, B M.J. Murray 7/7 3/3 √ A, B M.B. Swire 7/7 √ A, B Independent Non-Executive Directors L.K.L. Cheng 7/7 3/3 √ A, B T.T.K. Choi 7/7 2/2 2/2 √ A, B S.T. Fung 7/7 2/2 2/2 √ A, B J.L. Wang 7/7 √ A, B M.Y. Wu 7/7 3/3 √ A, B Average attendance 100% 100% 100% 100% 100% Notes: A: Received training materials about matters relevant to their duties as Directors. B: Attended training by external advisers about applicable laws and regulations and topics pertinent to the business of the Company. 96

Continuous Professional Development • detailed monthly management accounts consisting of The Company makes available continuous professional statements of profit or loss, financial position and cash development for all Directors at the expense of the Company flows compared to budget, together with forecasts so as to develop and refresh their knowledge and skills. • internal and external audit reports All Directors have been provided with “A Guide on Directors’ • feedback from customers, others with whom the Group Duties” issued by the Companies Registry, “Guidelines for does business, trade associations and service providers. Directors” issued by the Hong Kong Institute of Directors Securities Transactions and “Guidance for Boards and Directors” issued by The The Company has adopted a code of conduct (the Stock Exchange of Hong Kong Limited and other training “Securities Code”) regarding securities transactions by materials on various topics, including regulatory updates Directors and officers on terms no less exacting than the issued by The Stock Exchange of Hong Kong Limited and required standard set out in the Model Code for Securities external advisers and ESG matters. They were invited to Transactions by Directors of Listed Issuers (the “Model attend seminars and conferences about financial, Code”) contained in Appendix 10 to the Listing Rules. commercial, economic, risk management, legal, regulatory These rules are available on the Company’s website. and other business matters. A copy of the Securities Code has been sent to each Directors’ and Officers’ Insurance Director of the Company and is sent to each Director twice The Company has arranged appropriate insurance cover annually, immediately before the two financial period ends, in respect of potential legal actions against its Directors with a reminder that the Director cannot deal in the and Officers. securities and derivatives of the Company during the blackout period before the Group’s interim and annual Conflicts of Interest results have been published, and that all their dealings If a Director has a material conflict of interest in relation to must be conducted in accordance with the Securities Code. a transaction or proposal to be considered by the Board, Under the Securities Code, Directors and senior executives the individual is required to declare such interest and of the Company are required to notify the Chairman and abstains from voting. The matter is considered at a Board receive a dated written acknowledgement before dealing in meeting and voted on by Directors who have no material the securities and derivatives of the Company and, in the interest in the transaction. case of the Chairman himself, he must notify the Chairman Delegation by the Board of the Audit Committee and receive a dated written Responsibility for delivering the Company’s strategies and acknowledgement before any dealing. objectives, as established by the Board, and responsibility On specific enquiries made, all the Directors of the for day-to-day management is delegated to the Chief Company have confirmed that they have complied with the Executive. The Chief Executive has been given clear required standard set out in the Model Code and the guidelines and directions as to his powers and, in particular, Securities Code. the circumstances under which he should report back to, Directors’ interests at 31st December 2022 in the shares of and obtain prior approval from, the Board before making the Company and its associated corporations (within the commitments on behalf of the Company. meaning of Part XV of the Securities and Futures The Board monitors management’s performance against Ordinance) are set out in the section of this annual report the achievement of financial and non-financial measures, headed Directors’ Report. the principal items monitored being: 97 SWIRE PROPERTIES ANNUAL REPORT 2022

CORPORATE GOVERNANCE & SUSTAINABILITY | CORPORATE GOVERNANCE Appointment and Re-election No new appointment of director was made during 2022 Potential new Directors are identified and considered by and up to the date of this annual report. On 7th March the Nomination Committee for appointment by the Board. 2023, the Nomination Committee, having reviewed the A Director appointed by the Board is subject to election by Board’s composition and after taking into account the shareholders at the first annual general meeting after his or requirement that all directors are subject to election or her appointment, and all Directors are subject to re- re-election (as the case may be) in accordance with the election by shareholders every three years. Company’s Articles of Association, nominated L.K.L. Cheng, Potential new Board members are identified on the basis of T.T.K. Choi, R.S.K. Lim and M.Y. Wu for recommendation to skills, knowledge and experience which, on assessment by shareholders for re-election at the 2023 Annual General the Directors, will enable them to make a positive Meeting. The nominations were made in accordance with contribution to the diversity and performance of the Board. objective criteria (including gender, age, cultural and The Company reviews the composition of the Board on a educational background, ethnicity, professional continuing basis by keeping track of the tenure of Directors experience, skills, knowledge, length of service, number of and the need for new or replacement Directors to be directorships of listed companies and the legitimate appointed (as the case may be) and maintaining a pipeline interests of the Company’s principal shareholders), with of candidates comprising internal and external candidates due regard for the benefits of diversity, as set out in the as may be identified from time to time. Executive search Board Diversity Policy. The Nomination Committee is agencies may be engaged as appropriate to identify satisfied with the independence of L.K.L. Cheng, T.T.K. Choi external candidates with the desirable skillsets. The and M.Y. Wu having regard to the criteria set out in the composition of the Board includes directors from multiple Listing Rules. The Board, having considered the sources, i.e., independent non-executive directors, recommendation of the Nomination Committee and nomination from substantial shareholder and internal having taken into account the respective contributions of executives. L.K.L. Cheng, T.T.K. Choi, R.S.K. Lim and M.Y. Wu to the Board and their firm commitment to their roles, recommended all In assessing the suitability of a proposed candidate of them for re-election at the 2023 Annual General (including Directors eligible for re-appointment or Meeting. J.L. Wang will also retire this year but does not re-election), the following non-exhaustive list of factors offer himself for re-election. The particulars of the Directors will be considered: standing for re-election are set out in the section of this • the corporate strategy of the Company annual report headed Directors and Officers and will also be • the structure, size, composition and needs of the Board set out in the circular to shareholders to be distributed with • the potential contributions a candidate can bring to the this annual report and posted on the Company’s website. Board, including the desirable skillsets, experience and Full details of changes in the Board during the year and to other attributes that are complementary to the Board the date of this report are provided in the section of this • the qualifications, integrity and expected time annual report headed Directors’ Report. commitment of the candidate • various aspects of diversity (including gender, age, Board Diversity cultural and educational background and ethnicity) with The Board has adopted a Board Diversity Policy, which is reference to the Board Diversity Policy of the Company available on the Company’s website. Responsibility for the • the independence of a candidate to be appointed as an implementation, monitoring and annual review of this Independent Non-Executive Director policy has been delegated to the Nomination Committee. 98

The Board’s composition reflects a balance of skills, experience and diversity of perspectives among its members that are relevant to the Company’s strategy, governance and business and contributes to the Board’s effectiveness. SKILLS, EXPERTISE AND EXPERIENCE Related Industry Experience 9 (Real Estate/Hotels/Retail) Executive Leadership 13 and tratey Relevant aret Experience 13 ccountin/inance and 4 Ris anae ent ­iital 5 E€ 11 out of 13 Directors AGE GENDER 23% 41-50 years 31% 31% 51-60 years Male 61-70 years Female 46% 69% ETHNICITY YEARS OF SERVICE AS DIRECTOR 38% 3 years or below 31% 38% Non-Chinese 4-9 years 62% Chinese over 9 years 31% 99 SWIRE PROPERTIES ANNUAL REPORT 2022

CORPORATE GOVERNANCE & SUSTAINABILITY | CORPORATE GOVERNANCE In order to achieve a diversity of perspectives among Chairman. Its terms of reference comply with the CG Code members of the Board, it is the policy of the Company to and are posted on the Company’s website. consider a number of factors when deciding on The Nomination Committee’s duties include: appointments to the Board and the continuation of those appointments. Such factors include gender, age, cultural and • to review the structure, size and composition (including educational background, ethnicity, professional experience, the skills, knowledge and experience) of the Board at skills, knowledge, length of service and the legitimate least annually and make recommendations on any interests of the Company’s principal shareholders. proposed changes to the Board to complement the The Board is committed to maintaining an appropriate Company’s corporate strategy percentage of female members, which shall be no less than • to identify individuals suitably qualified to become 30% at all times. board members and select or make recommendations to the Board on the selection of individuals nominated The Company is also committed to maintaining a gender for directorship balance in the workforce with a target of keeping the • to assess the independence of the Independent Non- female ratio at no less than 40% at all times. Details of Executive Directors gender diversity in the workforce are disclosed in the • to make recommendations to the Board on the section of this annual report headed Sustainable appointment or re-appointment of Directors and Development. succession planning for Directors, in particular the The Company has adopted the following measures to Chairman and the Chief Executive develop a pipeline of potential successors to the Board: • to review the implementation and effectiveness of the Company’s policy on board diversity on an annual basis • The Company keeps track of the tenure of Directors The Nomination Committee met twice in 2022 and once in and the need for new or replacement directors to be 2023 up to the date of this annual report. A summary of its appointed (as the case may be), and maintains a work is as follows: running list of candidates comprising internal and external candidates as may be identified from time • it conducted (i) an annual review of the structure, size to time and composition (including the skills, knowledge and • Principles and key criteria for evaluating candidates experience) of the Board and considered that the for directorship are set out in the Nomination Board’s composition reflects an appropriate mix of skills, Committee’s terms of reference and the Company’s experience and diversity among its members that are Board Diversity Policy relevant to the Company’s strategy, governance and business and contributes to the Board’s effectiveness; • The skills and experience of existing Directors help set (ii) an annual assessment of the independence of each the criteria for internal and external candidate search Independent Non-Executive Director and considered all • Executive search agencies may be engaged as of the Independent Non-Executive Directors to be appropriate to identify external candidates with independent; and (iii) an annual review of the desirable skillsets implementation and effectiveness of the Company’s Board Diversity Policy and considered it to be Nomination Committee appropriate • it endorsed for approval by the Board the proposal to The Nomination Committee consists of three Non- maintain a percentage of female Directors at no less Executive Directors, T.T.K. Choi, N.A.H. Fenwick and S.T. than 30% Fung. Two of the Committee members are Independent • it made recommendations to the Board in respect of the Non-Executive Directors, one of whom, S.T. Fung, is re-election of the Directors retiring at the 2023 Annual General Meeting 100

The Nomination Committee assessed the Board’s diversity companies, time commitments and responsibilities and by reviewing a comparison against industry and peer group employment conditions elsewhere in the Group. companies, and the relevant experience and skillsets of the The terms of reference of the Remuneration Committee Directors. The Committee considered that: have been reviewed with reference to the CG Code and are • the ratios for the objective criteria (e.g. age, gender and posted on the Company’s website. ethnicity) amongst Board members were reasonable In order to be able to attract and retain staff with the • the Company was in a good position in terms of gender appropriate skills, experience and of suitable calibre, the diversity compared with its peers Swire group provides a competitive remuneration package • the Board shall maintain a percentage of female designed to be commensurate, overall, with those of its Directors of not less than 30% peer group. This typically comprises salary, housing, Remuneration Committee retirement benefits, leave-passages and education allowances and, after three years’ service, a discretionary Full details of the remuneration of the Directors are bonus. Although the remuneration of executives is not provided in note 9 to the financial statements. entirely linked to the profits of the Company, it is The Remuneration Committee comprises three Non- considered that these arrangements have contributed Executive Directors, S.T. Fung, T.T.K. Choi and N.A.H. considerably to the maintenance of a flexible, motivated Fenwick. Two of the Committee members are Independent and high-calibre management team within Non-Executive Directors, one of whom, S.T. Fung, is the Group. Chairman. All the members served for the whole of 2022. The Remuneration Committee reviewed the structure and The Remuneration Committee reviews and approves the levels of remuneration paid to Executive Directors at its remuneration proposals with respect to the Executive meeting in October 2022. At this meeting the Committee Directors and senior management of the Company, with considered a report prepared for it by Mercer Limited, an reference to the Company’s Remuneration Policy and the independent firm of consultants, which confirmed that the Board’s corporate goals and objectives. remuneration of the Company’s Executive Directors, as disclosed in note 9 to the financial statements, was The Remuneration Committee exercises the powers of the comparable with that paid to equivalent executives in peer Board to determine the remuneration packages of group companies. individual Executive Directors (including salaries, bonuses, No Director takes part in any discussion about his or her benefits in kind and the terms on which they participate in own remuneration. any provident fund or other retirement benefit scheme), taking into consideration salaries paid by comparable The following fee levels have been approved by the Board: 2022 2023 Fee HK$ HK$ Director’s Fee 575,000 575,000 Fee for Audit Committee Chairman 268,000 268,000 Fee for Audit Committee Member 186,000 186,000 Fee for Nomination Committee Chairman 83,000 83,000 Fee for Nomination Committee Member 60,000 60,000 Fee for Remuneration Committee Chairman 83,000 83,000 Fee for Remuneration Committee Member 60,000 60,000 101 SWIRE PROPERTIES ANNUAL REPORT 2022

CORPORATE GOVERNANCE & SUSTAINABILITY | CORPORATE GOVERNANCE Accountability and Audit The Company is committed to developing and maintaining Financial Reporting high professional and ethical standards. These are reflected in the rigorous selection process and career development The Board acknowledges its responsibility for: plans for all employees. The organisation prides itself on • the proper stewardship of the Company’s affairs, to being a long-term employer which instills in individuals, as ensure the integrity of financial information they progress through the Group, a thorough understanding • preparing annual and interim financial statements and of the Company’s ways of thinking and acting. other related information that give a true and fair view of Channels of communication are clearly established, the Group’s affairs and of its results and cash flows for allowing employees a means of communicating their views the relevant periods, in accordance with Hong Kong upwards with a willingness on the part of more senior Financial Reporting Standards and the Hong Kong personnel to listen. Employees are aware that, whenever Companies Ordinance the unexpected occurs, attention should be given not only • selecting appropriate accounting policies and ensuring to the event itself, but also to determining the cause. that these are consistently applied Through the Company’s Corporate Code of Conduct, • making judgements and estimates that are prudent employees are encouraged (and instructed as to how) to and reasonable report control deficiencies or suspicions of impropriety to • ensuring that the application of the going concern those who are in a position to take necessary action. The assumption is appropriate Company has a Whistleblowing Policy and system for Risk Management and Internal Control employees and those who deal with the Group to raise The Board acknowledges its responsibility to establish, concerns, in confidence and with anonymity, where maintain and review the effectiveness of the Group’s risk desired, about actual or suspected cases of impropriety in management and internal control systems. This any matter related to the Group. The policy is available on responsibility is primarily fulfilled on its behalf by the the Company’s website. Audit Committee as discussed on pages 103 to 104. The Company has an Anti-Bribery and Corruption Policy The foundation of strong risk management and internal which sets out the Company’s policy and systems that control systems is dependent on the ethics and culture of promote and support compliance with applicable anti- the organisation, the quality and competence of its bribery and corruption laws and regulations, and enhances personnel, the direction provided by the Board, and the the provisions relating to bribery and corruption in the effectiveness of management. Company’s Corporate Code of Conduct. The policy is available on the Company’s website. Since profits are, in part, the reward for successful risk Risk assessment: The Board of Directors and the taking in business, the risk management and internal management each have a responsibility to identify and control systems are designed to manage rather than analyse the risks underlying the achievement of business eliminate the risk of failure to achieve business objectives objectives, and to determine how such risks should be and can only provide reasonable and not absolute managed and mitigated. assurance against material misstatement or loss. The key components of the Group’s control structure are Management structure: The Group has a clear as follows: organisational structure that, to the extent required, delegates the day-to-day responsibility for the design, Culture: The Board believes that good corporate documentation and implementation of procedures and governance reflects the culture of an organisation. This is monitoring of risk. Individuals appreciate where they will be more significant than any written procedures. held accountable in this process. The Company aims at all times to act ethically and with integrity, and to instill this behaviour in all its employees by example from the Board down. The Company has a Corporate Code of Conduct, which is posted on its website. 102

A control self-assessment process requires management to Internal audit: Independent of management, the assess, through the use of detailed questionnaires, the Internal Audit Department (“IA”) reports directly to the adequacy and effectiveness of risk management and Audit Committee and performs regular reviews of key internal controls over the reliability of financial reporting, risk areas and monitors compliance with Group the effectiveness and efficiency of operations and accounting, financial and operational procedures. The compliance with applicable laws and regulations. This role of IA is discussed further on pages 104 to 105. process and its results are reviewed by internal auditors and form part of the Audit Committee’s annual assessment Audit Committee of control effectiveness. The Audit Committee, consisting of three Non- Controls and review: The control environment comprises Executive Directors, M.Y. Wu, L.K.L. Cheng and M.J. policies and procedures intended to ensure that relevant Murray, assists the Board in discharging its management directives are carried out and actions that responsibilities for corporate governance and financial may be needed to address risks are taken. These may reporting. Two of the Committee members are include approvals and verifications, reviews, safeguarding Independent Non-Executive Directors, one of whom, of assets and segregation of duties. Control activities can M.Y. Wu, is Chairman. All the members served for the be divided into operations, financial reporting and whole of 2022. compliance, although there may, on occasion, be some The terms of reference of the Audit Committee follow overlap between them. The typical control activities the guidelines set out by the Hong Kong Institute of include: Certified Public Accountants and comply with the CG • analytical reviews: for example, conducting reviews of Code. They are available on the Company’s website. actual performance versus budgets, forecasts, prior The Audit Committee met three times in 2022. Regular periods and competitors attendees at the meetings are the Finance Director, the • direct functional or activity management: reviews of Head of Internal Audit of the Swire group and the performance reports, conducted by managers in charge external auditors. The Audit Committee meets at least of functions or activities twice a year with the external auditors, and at least • information-processing: performing controls intended to once a year with the Head of Internal Audit, in each check the authorisation of transactions and the case without the presence of management. Each accuracy and completeness of their reporting, for meeting receives written reports from the external example, exception reports auditors and IA. The external valuer (Cushman & • physical controls: ensuring equipment, inventories, Wakefield Limited) also attended two of the meetings. securities and other assets are safeguarded and subjected to periodic checks The work of the Committee during 2022 included • performance indicators: carrying out analyses of reviews of the following matters: different sets of data, operational and financial, • the completeness, accuracy and integrity of formal examining the relationships between them, and taking announcements relating to the Group’s performance corrective action where necessary including the 2021 annual and 2022 interim reports • segregation of duties: dividing and segregating duties and announcements, with recommendations to the among different people, with a view to strengthening Board for approval checks and minimising the risk of errors and abuse • the Group’s compliance with regulatory and The Company has in place effective processes and systems statutory requirements for the identification, capture and reporting of operational, • the Group’s risk management and internal control financial and compliance-related information in a form and systems time-frame intended to ensure that staff carry out their • the Group’s risk management processes designated responsibilities. • the Group’s cybersecurity 103 SWIRE PROPERTIES ANNUAL REPORT 2022

CORPORATE GOVERNANCE & SUSTAINABILITY | CORPORATE GOVERNANCE • the approval of the 2023 annual Internal Audit • the effectiveness of the Company’s processes in relation programme and review of progress on the 2022 to financial reporting and statutory and regulatory programme compliance • periodic reports from IA and progress in resolving any • areas of risk identified by management matters identified in them • significant risks reported by IA • significant accounting and audit issues • work programmes proposed by IA and the external • the Company’s policy regarding connected transactions auditors and the nature of such transactions • significant issues arising from internal and external • the relationship with the external auditors as discussed audit reports on pages 105 to 106 • the results of management’s control self-assessment • the Company’s compliance with the CG Code exercise • the Company’s code and policies As a result of the above review, the Board confirms, and In 2023, the Committee has reviewed, and recommended management has also confirmed to the Board, that the to the Board for approval, the 2022 financial statements. Group’s risk management and internal control systems are effective and adequate and have complied with the Assessing the Effectiveness of Risk CG Code provisions on risk management and internal Management and Internal Control Systems control throughout the year and up to the date of this On behalf of the Board, the Audit Committee reviews annual report. annually the continued effectiveness of the Group’s risk Company Secretary management and internal control systems dealing with risk and financial accounting and reporting, the effectiveness The Company Secretary is an employee of the Company and efficiency of operations, compliance with laws and and is appointed by the Board. The Company Secretary is regulations, and risk management functions. responsible for facilitating the Board’s processes and This assessment considers: communications among Board members, with • the scope and quality of management’s ongoing shareholders and with management. The Company monitoring of risks (including ESG risks) and of the risk Secretary undertakes at least 15 hours of relevant management and internal control systems, the work and professional training annually to update skills and effectiveness of Internal Audit and the assurances knowledge. provided by the Finance Director Internal Audit Department • the changes in the nature and extent of significant risks (including ESG risks) since the previous review and the The Swire group has had IA in place for 27 years. IA plays a Group’s ability to respond to changes in its business and critical role in monitoring the governance of the Group. The the external environment department is staffed by 26 audit professionals and • the extent and frequency with which the results of conducts audits of the Group and of other companies in the monitoring are communicated, enabling the Committee Swire group. The 26 professionals include a team based in to build up a cumulative assessment of the state of the Chinese Mainland which reports to IA in Hong Kong. control in the Group and the effectiveness with which IA reports directly to the Audit Committee without the risk is being managed need to consult with management, and via the Audit • the incidence of any significant control failings or Committee to the Board. IA has unrestricted access to all weaknesses that have been identified at any time during areas of the Group’s business units, assets, records and the period and the extent to which they have resulted in personnel in the course of conducting its work. unforeseen outcomes or contingencies that have had, could have had, or may in the future have, a material The annual IA work plan and resources are reviewed and impact on the Company’s financial performance agreed with the Audit Committee. or condition 104

Scope of Work External Auditors Business unit audits are designed to provide assurance The Audit Committee acts as a point of contact, that the risk management and internal control systems independent from management, with the external auditors of the Company are implemented properly and (the “auditors”). The auditors have direct access to the operating effectively, and that the risks associated with Chairman of the Audit Committee, who meets with them the achievement of business objectives are being periodically without management present. properly identified, monitored and managed. The frequency of each audit is determined by IA using its The Audit Committee’s duties in relation to the auditors own risk assessment methodology, which is based on include: the COSO (Committee of Sponsoring Organizations of • recommending to the Board, for approval by the Treadway Commission) internal control framework, shareholders, the auditors’ appointment considering such factors as recognised risks, • approval of the auditors’ terms of engagement organisational change, overall materiality of each unit, • consideration of the letters of representation to be previous IA results, external auditors’ comments, output provided to the auditors in respect of the interim and from the work of the Swire Pacific Group Risk annual financial statements Management Committee and management’s views. • review of reports and other ad-hoc papers from the Each business unit is typically audited at least once auditors every three years. Acquired businesses would normally • annual appraisal of the quality and effectiveness of be audited within 12 months. 10 assignments were the auditors conducted for Swire Properties in 2022. • assessment of the auditors’ independence and IA specifically assists the Audit Committee in carrying objectivity, including the monitoring of non-audit out the analysis and independent appraisal of the services provided, with a view to ensuring that their adequacy and effectiveness of the Group’s risk independence and objectivity are not, and are not seen management and internal control systems through its to be, compromised review of the process by which management has • approval of audit and non-audit fees completed the annual Control Self-Assessment, and the Auditors’ Independence results of this assessment. Independence of the auditors is of critical importance to IA conducts ad-hoc projects and investigative work the Audit Committee, the Board and shareholders. The as may be required by management or the Audit auditors write annually to the members of the Audit Committee. Committee confirming that they are independent Audit Conclusion and Response accountants in accordance with the Code of Ethics for Professional Accountants of the Hong Kong Institute of Copies of IA reports are sent to the Chairman of the Certified Public Accountants and that they are not aware Board, the Chief Executive, the Finance Director and the of any matters which may reasonably be thought to bear external auditors. The results of each review are also on their independence. The Audit Committee assesses presented to the Audit Committee. the independence of the auditors by considering and Management is called upon to present action plans in discussing each such letter (and having regard to the fees response to IA’s recommendations, including those payable to the auditors for audit and non-audit work and aimed at resolving material internal control defects. the nature of the non-audit work) at a meeting of the These are agreed by IA, included in its reports and Audit Committee. followed up with a view to ensuring that they are satisfactorily undertaken. 105 SWIRE PROPERTIES ANNUAL REPORT 2022

CORPORATE GOVERNANCE & SUSTAINABILITY | CORPORATE GOVERNANCE Provision of Non-audit Services Shareholders In deciding whether the auditors should provide non-audit Communication with Shareholders services the following key principles are considered: and Investors • the auditors should not audit their own firm’s work The Board and senior management recognise their • the auditors should not make management decisions responsibility to represent the interests of all • the auditors’ independence should not be impaired shareholders and to maximise shareholder value. • quality of service Communication with shareholders and accountability In addition, the Company has a protocol in place for to shareholders is a high priority of the Company. approval of the provision of non-audit services by the The Company has a Shareholders’ Communication auditors. Any services which may be considered to be in Policy which is available on the Company’s website. The conflict with the role of the auditors must be submitted to Shareholders’ Communication Policy aims to ensure the Audit Committee for approval prior to engagement, that shareholders and the investment community are regardless of the amounts involved. The protocol is provided with appropriate and timely access to material updated from time to time to ensure compliance. information about the Company. It sets out the Fees paid to the auditors are disclosed in note 7 to the Company’s framework for promoting effective financial statements. communication with its shareholders so as to enable them to exercise their rights as shareholders in an Inside Information informed manner, and to allow the investment With respect to procedures and internal controls for the community to engage actively with the Company. The handling and dissemination of inside information, the Audit Committee reviews the implementation and Company: effectiveness of the Shareholders’ Communication Policy annually. The most recent review was conducted • is required to disclose inside information as soon as in August 2022 and the effectiveness of the policy reasonably practicable in accordance with the Securities was confirmed. and Futures Ordinance and the Listing Rules The methods used to communicate with shareholders • conducts its affairs with close regard to the “Guidelines include the following: on Disclosure of Inside Information” issued by the Securities and Futures Commission • the Chief Executive and Finance Director make • has included in its Corporate Code of Conduct a strict themselves available for meetings with major prohibition on the unauthorised use of confidential or shareholders, investors and analysts over two-month inside information periods immediately after the announcement of the • ensures, through its own internal reporting processes interim and annual results and at certain other times and the consideration of their outcome by senior during the year. In addition, they attended regular management, the appropriate handling and meetings with analysts and investors in Hong Kong, dissemination of inside information analyst briefings, investor group briefings, overseas roadshows and investor conferences during the year • through the Company’s website. This includes electronic copies of financial reports, audio webcasts of analyst presentations given at the time of the interim and annual results announcements, slides of presentations given at investor conferences, latest news, public announcements and general information about the Group’s businesses • through publication of interim and annual reports • through the annual general meeting as discussed below 106

Shareholders may send their enquiries and concerns Shareholder Engagement to the Board by post or email at ir@swireproperties. Pursuant to Article 95 of the Company’s Articles of com. The relevant contact details are set out in the Association, if a shareholder wishes to propose a person Financial Calendar and Information for Investors other than a retiring Director for election as a Director at section of this annual report. The Company’s a general meeting, he or she should deposit a written Shareholders’ Communication Policy also sets out notice of nomination at the registered office of the channels for shareholders to communicate their views Company within the 7-day period commencing on and on various matters. including the day after the despatch of the notice of the The Annual General Meeting meeting. The procedures for nominating candidates to stand for election as Directors at general meetings are The annual general meeting is an important forum to set out in the Corporate Governance section of the engage with shareholders. The most recent annual Company’s website. general meeting was held on 10th May 2022. The If they wish to propose a resolution relating to other meeting was open to shareholders. The Directors matters to be considered at a general meeting, who attended the meeting are shown in the table on shareholders are requested to follow the requirements page 96. and procedures set out in the Corporate Governance At the annual general meeting, separate resolutions section of the Company’s website. were proposed for each issue and were voted on by Shareholder(s) representing at least 5% of the total poll. The procedures for conducting a poll were voting rights of all members may request the Board to explained at the meeting prior to the polls being taken. convene a general meeting. The objects of the meeting The agenda items were: must be stated in the related requisition deposited at the • receiving the report of the Directors and the audited Company’s registered office. Detailed requirements and financial statements for the year ended 31st procedures are set out in the Corporate Governance December 2021 section of the Company’s website. • electing/re-electing Directors • re-appointing the auditors and authorising the Other Information for Shareholders Directors to set their remuneration Key shareholder dates for 2023 are set out in the section • a general mandate authorising the Directors to of this annual report headed Financial Calendar and make on-market share buy-backs Information for Investors and in the Financial Calendar • a general mandate authorising the Directors to allot on the Company’s website. and issue shares up to 20% of the number of shares No amendment has been made to the Company’s then in issue, provided that the aggregate number of Articles of Association during the year. the shares so allotted wholly for cash would not exceed 5% of the number of the shares then in issue From information publicly available to the Company and Minutes of the meeting together with voting results are within the knowledge of its Directors, at least 10.28% available on the Company’s website. (being the minimum public float percentage which the Company is required to maintain) of the Company’s total Dividend Policy number of issued shares are held by the public. Details of The Company has a policy on the payment of substantial shareholders’ and other interests are dividends, which is set out in the section of this annual included in the section of this annual report headed report headed Directors’ Report. Directors’ Report. 107 SWIRE PROPERTIES ANNUAL REPORT 2022

RISK MANAGEMENT The Board is responsible for evaluating and determining The management of risks is subject to audit by IA, the nature and extent of the risks it is willing to take in with support from specialist external consultants achieving the Company’s strategic objectives and for where necessary. ensuring that the Company establishes and maintains Further discussion of risk management is set out in the appropriate and effective risk management and internal sections of the Corporate Governance Report headed control systems. “Accountability and Audit – Risk Management and The Board and management are responsible for identifying Internal Control”, “Audit Committee – Assessing the and analysing the risks underlying the achievement of Effectiveness of Risk Management and Internal Control business objectives, and for determining how such risks Systems” and “Internal Audit Department – Scope of should be managed and mitigated. The Board oversees Work” on pages 102 to 103, page 104 and page 105 management in the design, implementation and respectively. monitoring of the risk management and internal control The following diagram illustrates the key risk systems, and management provides confirmations to the management processes of the Company. Board on the effectiveness of these systems. Risks that impact the achievement of business objectives are identified by management and categorised with reference to a risk taxonomy. Risk Identification Adequacy and effectiveness of Risk Risk Impact of the identified risks risk management and internal and vulnerability of the entity to controls are closely monitored Monitoring Analysis the risks are evaluated to by management through determine the risk level. regular review exercise. Risk Risk Reporting Mitigation Risks are regularly reviewed Internal control procedures and and reported to the Audit response protocols are designed, Committee and other relevant documented and implemented to governing parties. manage the risks and mitigate their impact. 108

Executive Committee The Executive Committee meets twice a month and is responsible for overseeing the day-to-day operations of the Company. It comprises three Executive Directors and eight members of senior management. The Chief Executive chairs the Executive Committee. The Executive Committee provides oversight of all the risks to which the Group is subject and is responsible for the design, implementation and monitoring of the relevant risk management and internal control systems of the Group. Matters of significance that arise are reported as appropriate via the Audit Committee to the Board of Directors. Risk Governance Framework Board of Directors Audit Committee Senior Management/Executive Committee or udit ernal a t SD 2030 SD 2030 SD 2030 SD 2030 Ex People Partners Performance Performance or/ Working Working (Environment) (Economic) udit Group Group Working Working Finance Group Group Business Department ernal a Units (Internal Int Control) Safety Safety Management Working Environmental Business System Group Committee Recovery Steering (Chinese Team Committee (HK) Mainland) 109 SWIRE PROPERTIES ANNUAL REPORT 2022

CORPORATE GOVERNANCE & SUSTAINABILITY | RISK MANAGEMENT Financial Risk Management The Group’s approach to financial risk management is discussed in note 2 to the financial statements. Risk Profile The following table provides an overview of our risk profile (listed in alphabetical order), including what we consider to be Swire Properties’ principal existing and emerging risks, possible associated impacts, risk trend and mitigation measures that are in place or under development. Existing Risks and Possible Impacts Risk Trend Mitigation Measures Brand and image • Crisis communication and social media policies are The failure to maintain brand position and in place and are updated and tested regularly to perception may make us less competitive. ensure consistent, responsible and responsive communication (including when handling major incidents) in order to safeguard the Company’s reputation. • Closely monitor social media in order to evaluate and provide responses to negative social media content. • Engagement with third parties to understand their perceptions of the Company and to anticipate current and potential economic, political, social or environmental issues that may adversely affect our reputation. Business disruption • A business recovery plan for major incidents, and Severe disruption to the business caused by other business compliance measures for specific acts of man or acts of nature may have scenarios, operational emergencies and health and adverse financial effects on the Company. safety, are in place and are regularly updated and tested. • In response to pandemic, standard operating procedures and guidelines are in place, ensuring intensive cleaning and disinfection of our premises. Government’s requirements and guidelines on pandemic or social distancing are strictly observed. • Strategic plans are regularly reviewed to maintain business resilience and sustainability. • Conduct site surveys and consult professional advisors to ensure properties in earthquake and hurricane zones are built to meet the relevant building codes and safety standards. • Purchase insurance to the extent practicable to cover financial loss due to property damage, business interruption and third-party liabilities. Risk level increased during the year 2022 Risk level decreased during the year 2022 Risk level remained broadly the same 110

Existing Risks and Possible Impacts Risk Trend Mitigation Measures Business risks • Obtain suitable reserves of land, reinforce existing The lack of compelling development projects assets and actively explore investment and business disruption may lead to a opportunities. slowdown in business and so affect financial • Monitor and evaluate disruptive business models, performance. with a view to making our operations more robust. • Enhance competitiveness by increasing efficiency, using appropriate technology and operational procedures. Development risks • Closely work with contractors to monitor and Delay in the completion of developments manage construction progress in order to avoid may have an adverse financial effect by delays. delaying the timing of property sales and • Stringent contractor prequalification requirements leasing. and stringent requirements for approving design changes. • Build in contingencies for statutory approvals and communicate with government authorities on a timely basis. Political risks • Regular review of investment strategy, business Changes in the global and local political model and capital allocation in response to any landscape and priorities may have impact of international tensions. significant impact on the business • Maintain high level of sensitivities to political and environment. social issues by closely monitoring social media and government policies with a timely response. • Senior management engagement with government authorities to anticipate political developments in order to plan appropriate responses and to ensure compliance with applicable laws and regulations. • Maintain robust corporate governance practice through oversight functions (internal audit, risk management, the company secretary, legal counsel and independent non-executive directors). Emerging Risks and Possible Impacts Risk Trend Mitigation Measures Climate change • A Climate Change Policy is in place and is updated Extreme weather conditions and climate regularly. change may increase the risks of physical • Conduct climate risk assessments at all portfolios to damage to properties and adversely affect manage the risks and to explore the opportunities their valuation. arising from the transition to a target of net-zero. • Science-based targets have been established to achieve long-term decarbonisation. • Monitor and reduce carbon emissions from construction activities and embodied carbon from major building and construction materials with the use of innovative technologies. 111 SWIRE PROPERTIES ANNUAL REPORT 2022

DIRECTORS AND OFFICERS Executive Directors MA, Suk Ching Mabelle, aged 55, has been a Director of BRADLEY, Guy Martin Coutts, aged 57, has been a Director the Company since August 2021. She is also the Director of the Company since January 2008 and its Chairman since Development and Valuations of the Company. She joined August 2021. He is also Chairman of John Swire & Sons the Swire group in 1996. She is a chartered surveyor, a (H.K.) Limited and Swire Pacific Limited, and a Director of member of The Royal Institution of Chartered Surveyors Cathay Pacific Airways Limited. He was the Company’s and a member of The Hong Kong Institute of Surveyors. Chief Executive from January 2015 to August 2021 and a She has worked in the real estate industry for over 30 years. Director of Swire Pacific Limited from January 2015 to May Non-Executive Directors 2017. He joined the Swire group in 1987 and has worked with the group in the Hong Kong SAR, Papua New Guinea, FENWICK, Nicholas Adam Hodnett, aged 62, has been a Japan, the United States, Vietnam, the Chinese Mainland, Director of the Company since May 2018. He is also a the Taiwan region and the Middle East. He is a chartered Director of John Swire & Sons Limited. He was employed by surveyor, a fellow of The Royal Institution of Chartered the Swire group from 1985 to 1995 and worked for the Surveyors and a member of The Hong Kong Institute of group in the Hong Kong SAR, Singapore, the Taiwan region, Surveyors. He is also Vice Chairman of the General the Philippines and the United States. Committee of the Hong Kong General Chamber of LIM, Siang Keat Raymond, aged 63, has been a Director of Commerce and Vice-President of The Real Estate the Company since July 2013. He is also Senior Adviser to Developers Association of Hong Kong. John Swire & Sons (H.K.) Limited. He is Non-Executive BLACKBURN, Timothy Joseph, aged 52, has been a Chairman of APS Asset Management Pte Ltd. He was a Director and Chief Executive of the Company since August Member of the Singapore Parliament from 2001 to 2015. 2021. He is also a Director of John Swire & Sons (H.K.) MURRAY, Martin James, aged 56, has been a Director of Limited. He joined the Swire group in 1994 and has worked the Company since April 2021. He is also Finance Director with the group in the Hong Kong SAR, Australia, Papua New of Swire Pacific Limited and a Director of John Swire & Sons Guinea, Singapore, London and the Chinese Mainland. He is (H.K.) Limited. He was previously a Director and Chief a chartered surveyor and a member of The Royal Financial Officer of Cathay Pacific Airways Limited and Institution of Chartered Surveyors. He is also a Global before that Deputy Finance Director of Swire Pacific Governing Trustee of the Urban Land Institute. Limited. He joined the Swire group in 1995 and has worked LUNG, Ngan Yee Fanny, aged 56, has been Finance with the group in the Hong Kong SAR, the United States, Director of the Company since October 2017. She was Singapore and Australia. He is a member of The Institute of previously Group Director Finance of Hong Kong Aircraft Chartered Accountants of Scotland and the Hong Kong Engineering Company Limited. She joined the Swire group Institute of Certified Public Accountants and a council in 1992. She is a member of the 8th Hainan Provincial member of The Hong Kong Management Association. Committee of the Chinese People’s Political Consultative SWIRE, Merlin Bingham, aged 49, has been a Director of Conference. She is also a member of the Hong Kong the Company since January 2009. He is also Deputy Institute of Certified Public Accountants, a member of the Chairman, Chief Executive and a shareholder of John Swire Institute of Management Accountants, a fellow of the & Sons Limited and a Director of Cathay Pacific Airways Association of Chartered Certified Accountants and a Limited and Swire Pacific Limited. He was Chairman of the member of the Financial Reporting Review Panel of the Company and Swire Pacific Limited from July 2018 to Accounting and Financial Reporting Council. August 2021. He joined the Swire group in 1997 and has worked with the group in the Hong Kong SAR, Australia, the Chinese Mainland and London. 112

Independent Non-Executive Directors WU, May Yihong, aged 55, has been a Director of the CHENG, Lily Ka Lai, aged 44, has been a Director of the Company since May 2017. She is Board Advisor of Company since March 2017. She is an Independent Non- Homeinns Hotel Group. She was the Chief Strategy Officer Executive Director of Chow Tai Fook Jewellery Group of Homeinns Hotel Group from 2010 to 2019, and its Chief Limited, Octopus Cards Limited, SUNeVision Holdings Ltd. Financial Officer from 2006 to 2010. She is an Independent as well as an Adviser to HotelBeds Group and a Non- Director of Noah Holdings Limited, the Chairwoman of its Executive Council Member of Herbert Smith Freehills Compensation Committee and member of its Audit Global LLP. She is an Executive Director of Hubel Labs Committee and Corporate Governance and Nomination Limited and was the former President of TripAdvisor Asia Committee. Pacific and Senior Director at Expedia Inc. She has more Company Secretary than ten years of experience as a corporate executive of technology companies providing consumer-facing software LOMAS, Bernadette Mak, aged 57, has been Company and internet services, including implementation of Secretary since February 2022. She is also Group General cybersecurity protocols. Counsel of the Swire Pacific Limited group. She is qualified CHOI, Tak Kwan Thomas, aged 67, has been a Director of to practise law in the Hong Kong SAR and in the State of the Company since May 2019. He is a fellow of The Royal New York. Prior to joining the Swire Pacific Limited group, Institution of Chartered Surveyors in the United Kingdom she was Group General Counsel and Company Secretary of and The Hong Kong Institute of Surveyors. He is also an a leading Hong Kong listed company. Authorised Person (Surveyor). He was a member of the Notes: Appeal Tribunal Panel (Buildings) from December 2000 to 1. The Audit Committee comprises M.Y. Wu November 2013. He was employed by the Company in (committee chairman), L.K.L. Cheng and M.J. Murray. Hong Kong from 1981 to 2002. He was employed by China 2. The Nomination Committee comprises S.T. Fung Resources (Holdings) Company Limited and worked in the (committee chairman), T.T.K. Choi and N.A.H. Fenwick. Chinese Mainland from 2002 until his retirement in 2016. 3. The Remuneration Committee comprises S.T. Fung (committee chairman), T.T.K. Choi and N.A.H. Fenwick. FUNG, Spencer Theodore, aged 49, has been a Director of 4. T.J. Blackburn, G.M.C. Bradley, F.N.Y. Lung, M.S.C. Ma, the Company since December 2012. He is Group Executive M.J. Murray and M.B. Swire are employees of the John Swire & Sons Limited group. Chairman of Li & Fung. He is also an Alternate Representative of Hong Kong, China to APEC Business Advisory Council and a member of the General Committee of The Hong Kong Exporters’ Association, Young Presidents’ Organization and the Board of Trustees at Northeastern University. WANG, Jinlong, aged 65, has been a Director of the Company since September 2019. He is an Independent Non-Executive Director of Kerry Group plc and Sonova Holding AG. He was previously an Operating Partner of Hony Capital Limited, Chairman and Chief Executive Officer of PizzaExpress Group Holdings Limited, President of Starbucks Asia Pacific, and Chairman and President of Starbucks Greater China. 113 SWIRE PROPERTIES ANNUAL REPORT 2022

DIRECTORS’ REPORT The Directors submit their report together with the audited Company’s share registrars, Computershare Hong Kong financial statements for the year ended 31st December Investor Services Limited, 17th Floor, Hopewell Centre, 2022, which are set out on pages 134 to 203. 183 Queen’s Road East, Hong Kong, for registration not Principal Activities later than 4:30 p.m. on Tuesday, 4th April 2023. To facilitate the processing of proxy voting for the The principal activities of Swire Properties Limited and its annual general meeting to be held on 9th May 2023, the subsidiaries are: (i) property investment, that is the register of members will be closed from 4th May 2023 to development, leasing and management of commercial, 9th May 2023, both days inclusive, during which period retail and some residential properties; (ii) property trading, no transfer of shares will be effected. In order to be that is the development and construction of properties, entitled to attend and vote at the annual general principally residential apartments, for sale; and (iii) meeting, all transfer forms accompanied by the relevant investment in and operation of hotels. share certificates must be lodged with the Company’s The principal activities of the Company’s principal share registrars, Computershare Hong Kong Investor subsidiary, joint venture and associated companies are Services Limited, 17th Floor, Hopewell Centre, 183 shown on pages 201 to 203. An analysis of the Group’s Queen’s Road East, Hong Kong, for registration not later performance for the year by reportable business segment than 4:30 p.m. on Wednesday, 3rd May 2023. and geographical area is set out in note 8 to the financial Business Review statements. A fair review of the Group’s business, a description of the Consolidated Financial Statements principal risks and uncertainties facing the Group, The consolidated Financial Statements incorporate the particulars of important events affecting the Group that financial statements of the Group together with the Group’s have occurred since the end of the financial year and an interests in joint venture and associated companies. Details indication of the likely future development of the of the joint venture and associated companies are provided Group’s business (including, in each case to the extent in notes 20 and 21 to the financial statements. necessary for an understanding of the development, performance or position of the Group’s business, key Dividends performance indicators) are provided in the sections of this annual report headed Chairman’s Statement, Chief The Directors have declared a second interim dividend of Executive’s Statement, Key Business Strategies, Review HK$0.68 per share which, together with the first interim of Operations, Financial Review and Financing and in the dividend of HK$0.32 per share paid in October 2022, notes to the financial statements. To the extent amount to full year dividend of HK$1.00 (2021: HK$0.95) necessary for an understanding of the development, per share. The second interim dividend will be paid on performance or position of the Group’s business, a Thursday, 4th May 2023 to shareholders registered at the discussion of the Group’s environmental policies and close of business on the record date, being Thursday, 6th performance and an account of the Group’s key April 2023. Shares of the Company will be traded ex- relationships with its employees, customers and dividend as from Monday, 3rd April 2023. suppliers and others that have a significant impact on The Company’s dividend policy is to deliver sustainable the Group and on which the Group’s success depends growth in dividends and to pay out approximately half of are provided in the section of this annual report headed our underlying profit in ordinary dividends over time. Sustainable Development, and a discussion of the Group’s compliance with the relevant laws and Closure of Register of Members regulations that have a significant impact on the Group is provided in the sections of this annual report headed The register of members will be closed on Thursday, 6th Sustainable Development, Corporate Governance, Risk April 2023, during which day no transfer of shares will be Management and Directors’ Report. Detailed effected. In order to qualify for entitlement to the second information on the Group’s sustainability performance is interim dividend, all transfer forms accompanied by the provided in the Sustainable Development Report 2022. relevant share certificates must be lodged with the 114

Reserves Environmental, Social and Governance Movements in the reserves of the Group and the Company The Company has complied with all the applicable during the year are set out in notes 36 and 37 to the provisions set out in Part C of the Environmental, Social financial statements. and Governance Reporting Guide contained in Appendix 27 to the Listing Rules for the year covered by the annual Share Capital report. There was no purchase, sale or redemption by the Donations Company, or any of its subsidiaries, of the Company’s shares during the year and the Group has not adopted any During the year, the Group made donations for charitable share option scheme. purposes of HK$44 million and donations towards various At 31st December 2022, 5,850,000,000 shares were in issue scholarships of HK$0.5 million. (31st December 2021: 5,850,000,000 shares). Details of the Fixed Assets movement of share capital are set out in note 35 to the financial statements. For details of movements in fixed assets refer to notes 15 Accounting Policies and 16 to the financial statements. The annual valuation of the Group’s investment property The principal accounting policies of the Group are set out in portfolio, whether completed or in the course of the relevant notes to the financial statements (if they development, was carried out by professionally qualified relate to a particular item) and in the section of this annual valuers (95% by value having been valued by Cushman & report headed Principal Accounting Policies. Wakefield Limited and 2% by value having been valued by another independent valuer) on the basis of market Auditors value at 31st December 2022. This valuation resulted in PricewaterhouseCoopers retire and, being eligible, offer an increase of HK$801 million in the carrying value of the themselves for re-appointment. A resolution for the re- investment property portfolio. appointment of PricewaterhouseCoopers as auditors of the A schedule of the principal properties of the Group and Company is to be proposed at the forthcoming annual its joint venture and associated companies is given in the general meeting. section of this annual report headed Schedule of Principal Group Properties. Financial Review Borrowings A review of the consolidated results, financial position and cash flows of the Group is shown in the section of this For details of the Group’s borrowings refer to the section annual report headed Financial Review. A ten-year financial of this annual report headed Financing. summary of the results and of the assets and liabilities of the Group is shown in the section of this annual report Interest headed Ten-Year Financial Summary. For details of the amount of interest capitalised by the Corporate Governance Group refer to page 86. The Company complied with all the code provisions set out Major Customers and Suppliers in the Corporate Governance Code (the “CG Code”) During the year, less than 30% of the Group’s sales and contained in Part 2 of Appendix 14 to the Listing Rules less than 30% of the Group’s purchases were attributable throughout the year covered by the annual report. to the Group’s five largest customers and suppliers Details of the Company’s corporate governance practices respectively. are set out in the section of this annual report headed Corporate Governance. 115 SWIRE PROPERTIES ANNUAL REPORT 2022

CORPORATE GOVERNANCE & SUSTAINABILITY | DIRECTORS’ REPORT Directors and M.Y. Wu retire this year and, being eligible, offer All the Directors of the Company whose names are listed in themselves for re-election. J.L. Wang also retires this the section of this annual report headed Directors and year but does not offer himself for re-election. Officers served throughout the calendar year 2022. No new Each of the Directors has entered into a letter of appointment of Director was made during 2022 and up to appointment, which constitutes a service contract, the date of this annual report. with the Company for a term of up to three years until retirement under Article 91 or Article 93 of the Articles of Independence Confirmation Association of the Company, which will be renewed for a term of three years upon each election or re-election. The Company has received from all of its Independent No Director has a service contract with the Company Non-Executive Directors (listed in the section of this annual which is not determinable by the employer within one report headed Directors and Officers) confirmation of their year without payment of compensation (other than independence pursuant to Listing Rule 3.13 and considers statutory compensation). all of them to be independent. Term of Appointment Fees and Emoluments Article 93 of the Company’s Articles of Association provides Full details of Directors’ fees and emoluments are set out for all Directors to retire at the third annual general in note 9 to the financial statements. meeting following their election by ordinary resolution. In Directors’ fees paid to the Independent Non-Executive accordance therewith, L.K.L. Cheng, T.T.K. Choi, R.S.K. Lim Directors during the year totalled HK$3.6 million. They received no other emoluments from the Group. Directors’ Interests At 31st December 2022, the register maintained under Section 352 of the Securities and Futures Ordinance (“SFO”) showed that Directors held the following interests in the shares of Swire Properties Limited and its associated corporations (within the meaning of Part XV of the SFO), John Swire & Sons Limited and Swire Pacific Limited: Capacity Beneficial Interest Percentage Trust Total No. of Voting Personal Family Interest of Shares Shares (%) Note Swire Properties Limited L.K.L. Cheng 1,000 – – 1,000 0.00002 M.B. Swire – – 1,148,812 1,148,812 0.01964 (3) Percentage Capacity of Issued Share Capital Beneficial Interest (comprised Trust Total No. in the class) Personal Family Interest of Shares (%) Note John Swire & Sons Limited Ordinary Shares of £1 N.A.H. Fenwick – – 3,136,000 3,136,000 3.14 (1) M.B. Swire 2,193,550 630,000 14,569,960 17,393,510 17.39 (2) 8% Cum. Preference Shares of £1 N.A.H. Fenwick – – 2,822,400 2,822,400 3.14 (1) M.B. Swire 3,966,125 – 11,904,363 15,870,488 17.63 (2) 116

Percentage Capacity of Voting Shares Beneficial Interest (comprised Trust Total No. in the class) Personal Family Interest of Shares (%) Note Swire Pacific Limited ‘A’ shares L.K.L. Cheng 10,000 – – 10,000 0.0012 M.B. Swire 180,000 – 301,000 481,000 0.0556 (3) ‘B’ shares M.B. Swire 390,000 – 3,024,617 3,414,617 0.1161 (2) Notes: (1) N.A.H. Fenwick was a trustee of a trust which held 3,136,000 ordinary shares and 2,822,400 preference shares in John Swire & Sons Limited included under Trust interest and did not have any beneficial interest in those shares. (2) M.B. Swire was a trustee and/or a potential beneficiary of trusts which held 3,246,624 ordinary shares and 1,691,961 preference shares in John Swire & Sons Limited and 1,225,395 ‘B’ shares in Swire Pacific Limited included under Trust interest and did not have any beneficial interest in those shares. M.B. Swire was one of the executors of a will which held 1,799,222 ‘B’ shares in Swire Pacific Limited included under Trust interest and did not have any beneficial interest in those shares. (3) All shares held by M.B. Swire under Trust interest were held by him as one of the executors of a will and he did not have any beneficial interest in those shares. Other than as stated above, no Director or Chief Executive of Directors of Subsidiaries the Company had any interest or short position, whether The names of all directors who have served on the beneficial or non-beneficial, in the shares or underlying shares boards of the subsidiaries of the Company during the and debentures of the Company or any of its associated year ended 31st December 2022 or during the period corporations (within the meaning of Part XV of the SFO). from 1st January 2023 to the date of this Report are Neither during nor prior to the year under review has any kept at the Company’s registered office and made right been granted to, or exercised by, any Director of the available for inspection by the members of the Company, or to or by the spouse or minor child of any Company in accordance with Section 390(6) of the Director, to subscribe for shares, warrants or debentures of Companies Ordinance (Cap. 622 of the Laws of the Company. Hong Kong). Other than as stated in this report, no transaction, Permitted Indemnity arrangement or contract of significance to which the Group was a party and in which a Director or an entity connected Subject to the Companies Ordinance (Cap. 622 of the with a Director is or was materially interested, either directly Laws of Hong Kong), every Director is entitled under the or indirectly, subsisted during or at the end of the year. Company’s Articles of Association to be indemnified out At no time during the year was the Company, or any of its of the assets of the Company against all costs, charges, associated corporations, a party to any arrangements to expenses, losses and liabilities which he or she may enable the Directors of the Company to acquire benefits by sustain or incur in or about the execution or discharge of means of the acquisition of shares in or debentures of the his or her duties and/or the exercise of his or her powers Company or any other body corporate. and/or otherwise in relation to or in connection with his or her duties, powers or office. To the extent permitted Directors’ Interests in Competing by such Ordinance, the Company has taken out Businesses insurance against the liability and costs associated with defending any proceedings which may be brought None of the Directors or their respective close associates against directors of companies in the Group. has any competing interests which need to be disclosed pursuant to Rule 8.10 of the Listing Rules. 117 SWIRE PROPERTIES ANNUAL REPORT 2022

CORPORATE GOVERNANCE & SUSTAINABILITY | DIRECTORS’ REPORT Substantial Shareholders’ and Other Interests The register of interests in shares and short positions maintained under Section 336 of the SFO shows that at 31st December 2022 the Company had been notified of the following interests in the shares of the Company held by substantial shareholders and other persons: Long position Number of Shares Percentage of Voting Shares (%) Type of Interest (notes) Swire Pacific Limited 4,796,765,835 82.00 Beneficial owner (1) John Swire & Sons Limited 4,796,765,835 82.00 Attributable interest (2) Notes: (1) Swire Pacific Limited was interested in 4,796,765,835 shares of the Company as beneficial owner. (2) John Swire & Sons Limited and its wholly-owned subsidiary John Swire & Sons (H.K.) Limited were deemed to be interested in a total of 4,796,765,835 shares of the Company, in which Swire Pacific Limited was interested, by virtue of the John Swire & Sons Limited group being interested in 59.78% of the equity of Swire Pacific Limited and controlling 67.64% of the voting rights attached to shares in Swire Pacific Limited. Public Float services of members of the staff of the Swire group), Listing Rule 8.08(1) of the Listing Rules requires that at least certain central services and such other services as may 25% of an issuer’s total number of issued shares must at all be agreed from time to time, and procured for the times be held by the public. The Company has been granted Company and its subsidiary, joint venture and by The Stock Exchange of Hong Kong Limited (the “Stock associated companies the use of relevant trademarks Exchange”) a waiver from strict compliance with Listing Rule owned by Swire. No fee is payable in consideration of 8.08(1) so as to allow a lower public float percentage of 10% such procuration obligation or such use. The (or such higher percentage as was held by the public upon procuration obligation would fall away if the Services completion of the listing of the shares of the Company on Agreement were terminated or not renewed. the Stock Exchange). On such completion on 18th January In return for these services, JS&SHK receives annual 2012, the public float percentage was approximately service fees calculated as 2.5% of the Company’s 10.28%. From information that is publicly available to the consolidated profit before taxation and non-controlling Company and within the knowledge of its Directors at the interests after certain adjustments. The fees for each date of this report, at least 10.28% of the Company’s total year are payable in cash in arrear in two instalments, number of issued shares are held by the public. an interim payment by the end of October and a final payment by the end of April of the following year, Continuing Connected Transactions adjusted to take account of the interim payment. The Company also reimburses the Swire group at cost for During the year ended 31st December 2022, the Group had most of the expenses incurred in the provision of the following continuing connected transactions, details of the services. which are set out below: The Services Agreement, which was entered into (a) Services Agreement between JS&SHK and the Company on 1st December There is an agreement for services (“Services 2004, took effect from 1st January 2005, was renewed Agreement”), in respect of which John Swire & Sons on 1st October 2007, was amended and restated with (H.K.) Limited (“JS&SHK”), a wholly-owned subsidiary effect from 1st January 2010, was renewed again on of John Swire & Sons Limited (“Swire”), provided to the 1st October 2010, 14th November 2013 and 1st Company and its subsidiaries advice and expertise of October 2016, was amended and restated on 9th the directors and senior officers of the Swire group, August 2019 and was renewed again on 1st October including (but not limited to) assistance in negotiating 2019 and 1st October 2022. The current term of the with regulatory and other governmental or official Services Agreement is from 1st January 2023 to 31st bodies, certain staff services (including full or part time December 2025 and it is renewable for successive 118

periods of three years thereafter unless either party to Agreement. N.A.H. Fenwick and M.B. Swire are so it gives to the other notice of termination of not less interested as shareholders, directors and/or employees than three months expiring on any 31st December. of Swire. Particulars of the fees paid and the expenses The Independent Non-Executive Directors of the Company, reimbursed for the year ended 31st December 2022 who are not interested in any connected transactions with are given in note 42 to the financial statements. the Group, have reviewed and confirmed that the continuing connected transactions as set out above have (b) Tenancy Framework Agreement been entered into by the Group in the ordinary and usual The Company, JS&SHK and Swire Pacific Limited course of business of the Group, on normal commercial (“Swire Pacific”) entered into a tenancy framework terms or better, and according to the agreements governing agreement (“Tenancy Framework Agreement”) on them on terms that are fair and reasonable and in the 14th August 2014 to govern existing and future interests of the shareholders of the Company as a whole. tenancy agreements between members of the Group, The auditors of the Company have also reviewed these members of the JS&SHK group and members of the transactions and confirmed to the Board that nothing has Swire Pacific group. The Tenancy Framework come to their attention that causes them to believe that Agreement, which took effect from 1st January 2014 they have not been approved by the Board of the and was renewed on 1st October 2015 and 1st October Company; that they were not, in all material respects, in 2018, was renewed again on 1st October 2021 for a accordance with the pricing policies of the Group if the term of three years from 1st January 2022 to 31st transactions involve the provision of goods or services by December 2024. It is renewable for successive periods the Group; that they were not entered into, in all material of three years thereafter unless any party to it gives to respects, in accordance with the relevant agreements the other parties notice of termination of not less than governing the transactions; and that the relevant annual three months expiring on any 31st December. Pursuant caps have been exceeded. to the Tenancy Framework Agreement, members of the Group, members of the JS&SHK group and Discloseable Transactions members of the Swire Pacific group enter into tenancy agreements from time to time on normal commercial (a) Formation of a Joint Venture for the terms based on prevailing market rentals. Acquisition and Development of Land For the year ended 31st December 2022, the in Xi’an aggregate rentals payable to the Group under On 4th March 2022, Chance Ascent Limited (“Chance tenancies subject to the Tenancy Framework Ascent”), an indirect wholly-owned subsidiary of the Agreement totalled HK$147 million. Company, formed a project company (the “Project At 31st December 2022, the Swire group was interested in Company”) with Xi’an Cheng Huan Cultural Investment 59.78% of the equity of Swire Pacific and controlled 67.64% and Development Co., Ltd. to acquire the land use of the voting rights attached to shares in Swire Pacific and rights in respect of land (the “Target Land”) located in Swire Pacific owned 82.00% of the Company’s total number the Beilin district of Xi’an for a consideration of of issued shares. JS&SHK, as a wholly-owned subsidiary of RMB2,575 million. The Project Company will acquire Swire, and Swire Pacific are therefore connected persons of and hold such land use rights and will be principally the Company under the Listing Rules. The transactions engaged in the development of the Target Land. under the Services Agreement and the Tenancy Framework Chance Ascent has a 70% interest in the Project Agreement are continuing connected transactions in Company and is obliged to contribute approximately respect of which announcements dated 11th August 2022 RMB2,558 million to its registered capital. Chance and 13th May 2021 respectively were published. Ascent’s total capital commitment to the acquisition and development of the Target Land is estimated to be As directors and/or employees of (or in one case as an RMB7,000 million. The formation of the Project adviser to) the Swire group, T.J. Blackburn, G.M.C. Bradley, Company constituted a discloseable transaction for R.S.K. Lim, F.N.Y. Lung and M.J. Murray are interested in the the Company under the Listing Rules, in respect of Services Agreement and the Tenancy Framework which an announcement dated 4th March 2022 was published. 119 SWIRE PROPERTIES ANNUAL REPORT 2022

CORPORATE GOVERNANCE & SUSTAINABILITY | DIRECTORS’ REPORT (b) Acquisitions of Further Interests in The First Transaction, the Second Transaction and the Sino-Ocean Taikoo Li Chengdu Third Transaction, when aggregated, constituted a As at 15th December 2022, Sino-Ocean Taikoo Li discloseable transaction of the Company under the Chengdu was owned by two holding companies Listing Rules, in respect of which an announcement (the “PH companies”, together with their respective dated 15th December 2022 was published. subsidiaries, the “PH Group”) and managed by a The First Transaction was completed on 21st property management company (the “PM Company” December 2022, in respect of which an announcement together with its subsidiaries, the “PM Group”), dated 21st December 2022 was published. The Group’s where the PH Group and the PM Group were owned interest in the Target Group increased from 50% to by the relevant subsidiaries of the Company (the 65% upon completion of the First Transaction. “Purchasers”) and the relevant subsidiaries of Sino- The Second Transaction was completed on 22nd Ocean Group Holding Limited (“SOG”) (the “Sellers”) February 2023. The Group’s interest in the PM Group on a 50:50 basis. The Target Group comprises the increased further to 100% upon completion of the PH Group and the PM Group. Second Transaction. On 15th December 2022, Immediately after completion of the Second (1) the Purchasers, the Sellers, SOG and Sino-Ocean Transaction, the Third Transaction was completed on Service Holding Limited (“SOG Service”) (SOG the same date. The Group’s interest in the PH Group together with SOG Service as the seller guarantors) increased further to 100% upon completion of the entered into the first master agreement for the Third Transaction. The Target Group became wholly- sale and purchase of a 15% interest in the owned by the Group. An announcement on the Target Group for a total cash consideration of completions dated 22nd February 2023 was published. RMB1,000,000,000 (the “First Transaction”); (2) the relevant Purchaser, the relevant Seller, SOG and SOG Service (SOG together with SOG Service On behalf of the Board as the seller guarantors) entered into the second master agreement for the sale and purchase of a 35% interest in the PM Group for a cash Guy Bradley consideration of RMB59,000,000 (the “Second Transaction”); and Chairman (3) the relevant Purchasers, the relevant Sellers Hong Kong, 9th March 2023 and SOG (as the seller guarantor) entered into the third master agreement for the sale and purchase of a 35% interest in the PH Group for a total cash consideration of RMB4,491,000,000 (the “Third Transaction”). 120

SUSTAINABLE DEVELOPMENT We believe that long-term value creation is dependent on the sustainable development of our business and the communities in which we operate. In 2022, Swire Properties continued its Sustainable Development (SD) 2030 Strategy which incorporates specific commitments and is designed to integrate sustainability into every aspect of our business. Our SD 2030 Strategy has five pillars: Places | People | Partners | Performance (Environment) | Performance (Economic) The details of our 2025 and 2030 targets and SD initiatives can be found in our Sustainable Development Report 2022. 121 SWIRE PROPERTIES ANNUAL REPORT 2022

CORPORATE GOVERNANCE & SUSTAINABILITY | SUSTAINABLE DEVELOPMENT Rolled out third edition of the Featured 5,000 upcycled “Re-poinsettias” “Sustainability We All Count” sustainable at White Christmas Street Fair 2022 development promotion campaign Hong Kong Hong Kong “Fighting Climate Change, landfills. The Street Fair raised over HK$862,000 in 2022 for Together We Can” Operation Santa Claus. In February 2022, we launched our third sustainability- As part of our 50th anniversary celebrations, 50 SPPA students themed campaign to showcase our pioneering initiatives to and alumni participated in the Urban Furniture Project to encourage our stakeholders to pursue our ambitious 1.5°C design life-size, functional and cutting-edge “tables & chairs”. goal and achieve net-zero emissions by 2050. Numerous The furniture will be on permanent display at Taikoo Place for events were held throughout the year, including public the greater Taikoo Place community to enjoy. eco-workshops and the “Together We Can” SD Character Supporting Arts and Culture in Hong Kong Contest for colleagues. Gigantic posters were displayed and the Chinese Mainland across our office and retail developments, and on social media, to raise public awareness on the importance of The Company continues to promote arts and culture as part climate action. of its 50th Anniversary celebrations. Places We partnered with Art Basel Hong Kong for the 10th year in 2022. Over the past decade, this collaboration has helped Places are at the heart of, and central to, the achievement inspire an increasingly dynamic arts scene, and has boosted of our SD 2030 Strategy. the city’s reputation as an international cultural hub. Swire Properties Placemaking Academy & In July 2022, we kicked off the first international tour of the White Christmas Street Fair 2022 Victoria and Albert Museum London’s critically acclaimed In 2022, we hosted our fourth youth empowerment exhibition, “Bags: Inside Out”. The first stop was Taikoo Li programme. Eight students were mentored by our senior Sanlitun in Beijing, followed by layovers at our developments management, industry experts and thought leaders, under in Shanghai, Guangzhou and Chengdu. The last stop will be the Swire Properties Placemaking Academy (SPPA) banner. Pacific Place in Hong Kong, in 2023. They designed, planned and executed our White Christmas In November 2022, we launched a specially-commissioned Street Fair 2022. The theme was “Bloom & Beyond” and it 50th Anniversary-theme botanical art series at Taikoo Place, celebrated our placemaking efforts over the past 50 years. “Seasons in Continuum”. Sculptures reflecting the anniversary With working towards a “zero-waste” event in mind, students theme “Original. Always.” were placed at several key spaces, embraced circularity and decorated the venue with 5,000 offering an immersive and creative playground for the “Re-poinsettias” – upcycled Christmas flowers made from community to enjoy. We also launched our 50th Anniversary old Cathay Pacific cabin crew uniforms and Swire Hotels Art NFT Collection, a collaboration with 10 artists from around bedsheets. In total, over 90% of waste was diverted from the world which showcased our creativity and commitment to fostering vibrant communities. 122

Launched Urban Furniture Project Hosted “A Day in the Dirt” event at with 50 Swire Properties Placemaking The Underline – a formerly underutilised Academy students and alumni land plot below Miami’s Metrorail Hong Kong U.S.A. Street Markets People The Tong Chong Street Market attracted over 462,000 The contributions of our employees are critical to visitors in 2022, despite a six-month hiatus due to COVID-19. our success. Tenants and visitors were again encouraged to bring their Employees own containers and utensils. In December 2022, Citygate Outlets held the Christmas Swire Properties employs over 6,000 people (including joint Outdoor Market featuring over 40 local artisans, social venture companies which the Group jointly operates and enterprises and NGOs. manages) across our operating region. Attracting and developing talented colleagues is central to our success. Placemaking Efforts in the U.S.A. We are an equal opportunities employer and aim to provide Brickell City Centre supported Miami-Dade County’s goal of a work environment that is respectful, challenging, rewarding reducing energy and water consumption by 25% over the and safe. next five years. In 2022, our development reduced electricity In 2022, we offered more than 154,000 hours of training and usage by 23%, and water and sewage usage by 20%, development in leadership and management, technology, compared to 2019; and topped the leaderboard in 2021 as IT, sustainability, diversity and inclusion, languages, health the commercial property with the most significant reduction and safety and employee wellness. in energy consumption. To drive diversity and inclusion, we set a gender balance Community Ambassadors in the U.S.A. hosted the “A Day in target of maintaining female representation at no less than the Dirt” event to weed and plant to keep The Underline, a 40%. In 2022, 40.2% of our workforce is female. formerly underutilised land plot below Miami’s Metrorail, Health & Safety clean and beautiful. We also partnered with South Florida People of Color to In 2022, we continued to deliver improvements on key celebrate diversity in Black culture. Activities included art indicators with lost time injury rate decreasing by 9.4% and series and weekly musical performances, as well as our lost day rate decreasing by 12.4%, compared to 2021. educational content at Brickell City Centre during Black We revised our Health and Safety Policy which underpins our History Month. We also hosted our second “Pride at BCC” commitment to providing and maintaining a healthy and celebration featuring seminars and workshops, and retailers safe environment for all stakeholders, and reinforces our shared their equality-related stories. The Miami-Dade Police Zero Harm commitment. and other law enforcement agencies from Miami-Dade and In 2022, we introduced an app-based near-miss and hazard Broward Counties hosted a parade featuring pride-branded reporting system, which enables more efficient corrective vehicles. actions, and supports data analysis to identify trends, and reporting. 123 SWIRE PROPERTIES ANNUAL REPORT 2022

CORPORATE GOVERNANCE & SUSTAINABILITY | SUSTAINABLE DEVELOPMENT Celebrated 10th anniversary of Hosted a youth summer camp to mark “BOOKS FOR LOVE @ $10” 5th anniversary of Sichuan Community Centre Hong Kong Chinese Mainland We continued to collaborate with our contractors to adopt the Sichuan Community Centre, which celebrated its 5th cutting-edge technology to improve site safety during the Anniversary. During an event at the century-old Chengdu construction stage of Two Taikoo Place and Six Pacific Place, YMCA building, children and volunteers handcrafted special including Scaffoldless Lift Installation Method (SLIM), souvenirs for local sanitation workers to thank them for their Robotic Water Testing Machine for Curtain Walls, Modular hard work in keeping the city clean. Integrated Mechanical and Electrical Installation (MIMEP) In Guangzhou, 80 Ambassadors joined the Mr Fix-it programme and Smart Helmets (IoT). to help people in need improve their living conditions At the Development Bureau and Construction Industry through basic structural refurbishment and furnishing. Council Construction Safety Awards, Six Pacific Place The “Walk for Love” programme saw support from 1,489 received Gold awards in the “Contractors for New Works Community Ambassadors across our operating cities in the Contracts” and “Innovation Awards for Safety and Chinese Mainland. We raised 848 hygiene kits for Tibetan Environmental Excellence for New Works” categories. Primary School students. Volunteering Partners Our Community Ambassadors continued to support the Our business partners play a critical part in the success of wider community in 2022. In Hong Kong, 1,669 Ambassadors our SD 2030 Strategy. contributed 3,723 hours of service at 41 events. The Programme won the Outstanding Volunteer Group Award at Suppliers the Hong Kong Volunteer Award 2022, a territory-wide We include our suppliers in our approach to sustainable scheme co-organised by the Homes and Youth Affairs development. We address sustainability and manage risks Bureau and the Agency for Volunteer Service. related to regulatory compliance, environmental protection, The flagship “BOOKS FOR LOVE @ $10” initiative celebrated health and safety, labour practices, human rights, product its 10th Anniversary and hosted over 30,000 visitors during responsibility and sustainable purchasing, in our supply an eight-day physical event at Taikoo Place. Along with the chain, through our supplier monitoring and evaluation new online book sale, we raised over HK$1,380,000 for our system, our supplier code of conduct and sustainable two charity partners. procurement tracking system. In 2022, HK$1,477 million Returning for the third year, the “NOODLES FOR LOVE $50 worth of sustainable products and services were procured. Matching Donation Scheme” generated 3,000 noodle packs Tenants for the greater Hong Kong community, in partnership with a Cityplaza retail tenant. We work closely with our commercial tenants to integrate In the Chinese Mainland, 1,849 Ambassadors contributed sustainability into their operations; and offer our office and 2,177 hours of service. A youth summer camp was hosted at retail tenants in Hong Kong and the Chinese Mainland free energy audits to identify energy-saving opportunities. As at 124

Over 1,400 Community Ambassadors Celebrated achievements with tenants participated in “Walk for Love” who joined the Green Performance Pledge charity initiative Pilot programme Chinese Mainland Hong Kong 31 December 2022, these audits covered approximately portfolio. The five urban farms have collectively yielded 6 million square feet of tenanted area. approximately 500 kg of crops. As of December 2022, we have Since 2019, we have presented Green Kitchen Awards to donated approximately 275 kg of food, equivalent to over 76 F&B tenants in Hong Kong and the Chinese Mainland. 3,600 packed meals, to local food bank Feeding Hong Kong. By installing energy-efficient kitchen appliances and well- The Loop initiative has engaged over 1,350 of our tenants’ designed ventilation systems together with recycling waste, staff via the Farm Club, events and workshops. these tenants have saved energy and water, reduced waste +UP! Better Living Pop-ups and improved the kitchen environment. Taikoo Place held the “+UP! Better Living Pop-ups” campaign Under our Green Performance Pledge (“GPP”), we have from October to November 2022, featuring a lifestyle-themed been collaborating with office tenants on fit-out and pop-up shop and a series of wellness-inspired activities at operations to improve their energy, water and waste ArtisTree. More than 350 office executives from 18 tenant recycling performance. We aim to have 50% of office companies took part in the corporate 8-Hour Charity Spin and tenants sign the GPP by 2025. We launched the GPP pilot inaugural indoor golf tournament. We raised over HK$508,000 in August 2021 and organised an awards ceremony in for charity Laureus Sport for Good Foundation, of which September 2022 to celebrate the collective achievements of HK$350,000 was donated by Swire Properties. participants. As at 31 December 2022, 52 tenants have signed the GPP, representing 37.9% of occupied lettable Annual Shopper Research floor area (covering over 2.5 million square feet) from the This programme was conducted at our nine malls in Hong Company’s Hong Kong office portfolio. Kong and the Chinese Mainland, with the aim of identifying In 2022, Taikoo Place and Pacific Place became the first shopper profiles and gauging customer behaviour. Visitors WiredScore-certified portfolios in Hong Kong, with Two to peer malls were also interviewed. Results from the studies Taikoo Place and Six Pacific Place being the first buildings will help gauge the performance of our malls and provide in Hong Kong to be both WiredScore and SmartScore actionable insights for management teams. Platinum certified. Performance (Environment) PROJECT AFTER 6 As a leading property developer, we are committed to We hosted five music performances in 2022, reaching over building and managing our developments sustainably. 1,100 of our tenants’ staff from 71 companies. Climate Change The Loop In 2022, we continued to progress steadily towards our This year, we expanded The Loop urban farms to One Pacific 1.5°C-aligned science-based targets, as part of our core Place, making it the fifth farm in our Hong Kong office strategy to reach net-zero emissions by 2050. This year, 125 SWIRE PROPERTIES ANNUAL REPORT 2022

CORPORATE GOVERNANCE & SUSTAINABILITY | SUSTAINABLE DEVELOPMENT Raised over HK$508,000 for charity Expanded network for Hong Kong’s through a series of wellness campaigns, first smart reusable cup system including an 8-hour spinning race Hong Kong Hong Kong we achieved a 28% absolute Scope 1 and 2 carbon reduction Technology Award 2023 – Commercial Buildings Existing compared to the 2019 baseline for our global portfolio. We Building Commissioning (EBCx), and awarded the winner of continued to adopt innovative low-carbon technologies and Best Digital Innovation at the CIBSE Building Performance management practices and invest in energy research and Awards 2023. Teaming up with a digital automation and development. energy-management company in the “Global AI Challenge Two Taikoo Place, one of our newest major Hong Kong for Building Electrical and Mechanical Facilities” to develop a developments, has adopted a lifecycle carbon management building cooling load prediction model, the joint team won a approach to identify emissions reduction opportunities. Gold Award and the Grand Prize – Alliance Contracting During the construction stage, the project adopted almost Outstanding AI Influencer Award, and scored the best model 100% Platinum-grade low-carbon concrete certified under accuracy in the Open Group, out of 44 global teams. the Construction Industry Council Green Product Resources & Circularity Certification. Structural steel and rebar with high recycled In 2022, we continued efforts to digitalise tenants’ waste content were also used. To support low-carbon building data via the Smart Waste Reduction Challenge. In total operations, Two Taikoo Place has adopted several industry- we engaged five of our offices and 13 tenants, and kicked leading energy-efficiency technologies and renewable off a brand-new smart mobile scale pilot with seven energy installations. office tenants. Energy To further drive a circular economy, Swire Properties In 2022, our electricity-use intensity decreased by 12.9% partnered with a sustainable asset management specialist compared to a 2019 baseline at our Hong Kong and Chinese to launch an office furniture solution for Taikoo Place and Mainland properties. The reduction reflected better Pacific Place tenants. As at December 2022, the initiative monitoring of heating, ventilation and air-conditioning helped five tenants divert more than 1,300 pieces of systems via our cloud-based smart-energy management furniture from landfills, totalling nearly 40 tonnes. platform; the introduction of electrically-commutated motor Swire Properties also partnered with Redress, a local plug fans; the retrofitting of air-conditioning systems; and environmental charity that tackles the issue of textile the use of more energy-efficient lighting. We continued to waste, for the fourth consecutive year. We supported “Get explore ways to increase on-site renewable energy Redressed Month” with 19 public collection boxes across our generation across our portfolios. In 2022, we installed a Hong Kong developments. Over 16 tonnes of second-hand 30 kW Photovoltaic (“PV”) system at Devon House and clothes were sorted with the help of over 640 volunteers a 78 kW PV system at Dorset House. from 36 companies. Swire Properties’ energy management efforts have been In June 2022, the Starstreet Precinct launched the “Recycle recognised. The Company received first place at the ASHRAE Your Bottles” campaign and invited the neighbourhood to 126

Launched “Recycle Your Bottles” campaign Partnered with ecopreneur HK Timberbank to collect and upcycle end-of-life plastics into to launch an upcycled wood bench installation Starstreet Precinct Christmas decorations at Citygate Outlets Hong Kong Hong Kong collect PET plastic bottles. Approximately 1,700 plastic The efforts at Two Taikoo Place generated the “Grand Award for bottles were collected and later converted into Christmas the New Building Category (Projects Under Construction and/ decorations at the Starstreet Precinct. or Design – Commercial)” at the Green Building Award 2021. In October 2022, Citygate Outlets partnered up with Performance (Economic) ecopreneur HK Timberbank to curate the “WOOD” You project. An upcycled wooden bench installation, made from We believe that long-term value creation depends on the dead and dying trees collected from different parts of sustainable development of our business. Lantau Island, was created and place in the Mall. Details of our financial performance in 2022 can be found in To promote reuse, we expanded our smart reusable cup other parts of this report. network at Taikoo Place to 10 café partners and began In 2022, the Company ranked fourth out of 500-plus real offering cups in more sizes. Since its launch, the initiative has estate companies in the world and first in Asia in the Dow prevented the disposal of over 16,800 single-use cups. Jones Sustainability World Index. It retained its Global Sector In 2022, over 75% of our F&B tenants and 113 office Leader title under the Global Real Estate Sustainability tenanted floors across our Hong Kong developments recycle Benchmark for the sixth consecutive year; ranked number food waste. one in the Hang Seng Corporate Sustainability Index for the Green Building fifth consecutive year, and achieved the highest “AAA” rating under MSCI Environmental, Social and Governance Ratings. In 2022, Taikoo Hui in Guangzhou achieved a Platinum rating At the Hong Kong Management Association’s 2022 Best under LEED v4 for Building Operations and Maintenance: Annual Reports Awards, Swire Properties’ Sustainable Existing Buildings, and a Platinum rating under WELL v2 Core Development Report 2021 won the Best Environmental, Certification. Taikoo Li Sanlitun in Beijing achieved a Social and Governance Reporting Award in the Property Platinum rating under LEED v4.1 for Operations and Development and Investment category. We also won the Maintenance: Existing Buildings. Pacific Place and Lincoln ESG Award in the Non-Hang Seng Index (Large Market House in Hong Kong achieved Platinum ratings under BEAM Capitalisation) Category at the Best Corporate Governance Plus for Existing Building v2.0. and ESG Awards 2022, organised by the Hong Kong Institute Swire Properties won the Pioneer Award in Green Building of Certified Public Accountants. Leadership Category (Facilities Management) at the Green As of 31 December 2022, approximately 60% of our Building Award 2021, organised by the Hong Kong Green financing comes from green bonds, sustainability-linked Building Council and the Professional Green Building loans and green loans. Council; and was the Sustainability Award winner at the RICS Awards 2022 Hong Kong. Further details of our sustainable development performance, including details of our SD 2030 Strategy, can be found in our Sustainable Development Report 2022. 127 SWIRE PROPERTIES ANNUAL REPORT 2022

Financial Contents AUDITOR’S REPORT AND ACCOUNTS 130 Independent Auditor’s Report 134 Consolidated Statement of Profit or Loss 135 Consolidated Statement of Other Comprehensive Income 136 Consolidated Statement of Financial Position 137 Consolidated Statement of Cash Flows 138 Consolidated Statement of Changes in Equity 139 Notes to the Financial Statements 198 Principal Accounting Policies 201 Principal Subsidiary, Joint Venture and Associated Companies SUPPLEMENTARY INFORMATION 204 Schedule of Principal Group Properties 215 Glossary 216 Financial Calendar and Information for Investors The Middle House

Financial Contents EAST Beijing The Temple House

INDEPENDENT AUDITOR’S REPORT To the Shareholders of Swire Properties Limited (incorporated in Hong Kong with limited liability) Opinion What we have audited The consolidated financial statements of Swire Properties Limited (the “Company”) and its subsidiaries (the “Group”), which are set out on pages 134 to 203, comprise: • the consolidated statement of financial position as at 31st December 2022; • the consolidated statement of profit or loss for the year then ended; • the consolidated statement of other comprehensive income for the year then ended; • the consolidated statement of cash flows for the year then ended; • the consolidated statement of changes in equity for the year then ended; and • the notes to the consolidated financial statements, which include significant accounting policies and other explanatory information. Our opinion In our opinion, the consolidated financial statements give a true and fair view of the consolidated financial position of the Group as at 31st December 2022, and of its consolidated financial performance and its consolidated cash flows for the year then ended in accordance with Hong Kong Financial Reporting Standards (“HKFRSs”) issued by the Hong Kong Institute of Certified Public Accountants (“HKICPA”) and have been properly prepared in compliance with the Hong Kong Companies Ordinance. Basis for Opinion We conducted our audit in accordance with Hong Kong Standards on Auditing (“HKSAs”) issued by the HKICPA. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements section of our report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Independence We are independent of the Group in accordance with the HKICPA’s Code of Ethics for Professional Accountants (“the Code”), and we have fulfilled our other ethical responsibilities in accordance with the Code. Key Audit Matters Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the consolidated financial statements of the current period. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. PricewaterhouseCoopers, 22/F Prince’s Building, Central, Hong Kong T: +852 2289 8888, F: +852 2810 9888, www.pwchk.com 130

Key Audit Matter Valuation of investment properties How our audit addressed the Key Audit Matter Refer to note 16 to the consolidated financial statements The fair value of the Group’s investment properties Our procedures in relation to the valuation of investment amounted to HK$271,368 million at 31st December 2022, properties included: with a fair value gain of HK$801 million recorded in the • Understanding management’s controls and processes for consolidated statement of profit or loss for the year. determining the valuation of investment properties and Valuations were obtained from third party valuers (the assessing the inherent risk of material misstatement by “valuer”) in respect of 97% of the investment properties as considering the degree of estimation uncertainty and the at 31st December 2022. The valuations are dependent on judgement involved in determining assumptions to be certain key assumptions that require significant applied; management judgement, including capitalisation rates and • Evaluating of the valuers’ competence, capabilities, market rents. The valuations of investment properties under independence and objectivity; development are also dependent upon the estimated costs to complete and expected developer’s profit margin. • Meeting the valuers to discuss the valuations and key assumptions used; • Reviewing of the external valuation reports to assess the appropriateness of methodologies used; • Comparing of the capitalisation rates, market rents and expected developer’s profit margin used by the valuers to an estimated range, determined by reference to publicly available information by our in-house valuation experts; • Checking the accuracy of the rental data provided by management to the valuers by agreeing them on a sample basis to the Group’s records; and • For investment properties under development, comparing the estimated construction costs to complete with the Group’s budgets. We found the key assumptions were supported by the available evidence. We found the disclosures in note 16 to be appropriate. SWIRE PROPERTIES ANNUAL REPORT 2022 131

INDEPENDENT AUDITOR’S REPORT Other Information The directors of the Company are responsible for the other information. The other information comprises all of the information included in the annual report other than the consolidated financial statements and our auditor’s report thereon. The other information does not include the specific information presented therein that is identified as being an integral part of the consolidated financial statements and, therefore, covered by our audit opinion on the consolidated financial statements. Our opinion on the consolidated financial statements does not cover the other information and we do not express any form of assurance conclusion thereon. In connection with our audit of the consolidated financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the consolidated financial statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard. Responsibilities of the Directors and the Audit Committee for the Consolidated Financial Statements The directors of the Company are responsible for the preparation of the consolidated financial statements that give a true and fair view in accordance with HKFRSs issued by the HKICPA and the Hong Kong Companies Ordinance, and for such internal control as the directors determine is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error. In preparing the consolidated financial statements, the directors are responsible for assessing the Group’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Group or to cease operations, or have no realistic alternative but to do so. The Audit Committee is responsible for overseeing the Group’s financial reporting process. Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. We report our opinion solely to you, as a body, in accordance with Section 405 of the Hong Kong Companies Ordinance, and for no other purpose. We do not assume responsibility towards or accept liability to any other person for the contents of this report. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with HKSAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements. As part of an audit in accordance with HKSAs, we exercise professional judgement and maintain professional scepticism throughout the audit. We also: • Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations or the override of internal control. 132

• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s internal control. • Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors. • Conclude on the appropriateness of the directors’ use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Group to cease to continue as a going concern. • Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation. • Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion. We communicate with the Audit Committee regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. We also provide the Audit Committee with a statement that we have complied with relevant ethical requirements regarding independence, and communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, actions taken to eliminate threats or safeguards applied. From the matters communicated with the Audit Committee, we determine those matters that were of most significance in the audit of the consolidated financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication. The engagement partner on the audit resulting in this independent auditor’s report is John J. Ryan. PricewaterhouseCoopers Certified Public Accountants Hong Kong, 9th March 2023 SWIRE PROPERTIES ANNUAL REPORT 2022 133

CONSOLIDATED STATEMENT OF PROFIT OR LOSS For the year ended 31st December 2022 2022 2021 Note HK$M HK$M Restated Revenue 4 13,826 16,318 Cost of sales 5 (4,303) (5,801) Gross profit 9,523 10,517 Administrative and selling expenses (1,713) (1,888) Other operating expenses (186) (200) Other net gains 6 79 1,231 Gains on disposal of subsidiary companies 43(c) 520 121 Change in fair value of investment properties 801 (1,947) Operating profit 9,024 7,834 Finance charges (359) (607) Finance income 172 230 Net finance charges 10 (187) (377) Share of profit less losses of joint venture companies 1,443 1,868 Share of profit less losses of associated companies 12 (82) Profit before taxation 10,292 9,243 Taxation 11 (2,065) (1,964) Profit for the year 8,227 7,279 Profit for the year attributable to: The Company’s shareholders 36 7,980 7,112 Non-controlling interests 38 247 167 8,227 7,279 HK$ HK$ Earnings per share from profit attributable to the Company’s shareholders (basic and diluted) 14 1.36 1.22 The above consolidated statement of profit or loss should be read in conjunction with the accompanying notes. 134

CONSOLIDATED STATEMENT OF OTHER COMPREHENSIVE INCOME For the year ended 31st December 2022 2022 2021 HK$M HK$M Restated Profit for the year 8,227 7,279 Other comprehensive income Items that will not be reclassified to profit or loss Revaluation of properties previously occupied by the Group – gains recognised during the year – 94 – deferred tax – (4) Defined benefit plans – remeasurement gains/(losses) recognised during the year 245 (26) – deferred tax (40) 4 205 68 Items that may be reclassified subsequently to profit or loss Cash flow hedges – losses recognised during the year (16) (38) – transferred to net finance charges (13) 14 – transferred to operating profit (1) – – deferred tax 5 4 Share of other comprehensive income of joint venture and associated companies (1,744) 561 Net translation differences on foreign operations recognised during the year (3,323) 1,093 (5,092) 1,634 Other comprehensive income for the year, net of tax (4,887) 1,702 Total comprehensive income for the year 3,340 8,981 Total comprehensive income attributable to: The Company’s shareholders 3,203 8,791 Non-controlling interests 137 190 3,340 8,981 The above consolidated statement of other comprehensive income should be read in conjunction with the accompanying notes. SWIRE PROPERTIES ANNUAL REPORT 2022 SWIRE PROPERTIES ANNUAL REPORT 2022 135

CONSOLIDATED STATEMENT OF FINANCIAL POSITION At 31st December 2022 31st 31st 1st December December January Note 2022 2021 2021 HK$M HK$M HK$M Restated Restated ASSETS AND LIABILITIES Non-current assets 3,165 3,381 4,322 Property, plant and equipment 15 Investment properties 16 271,368 267,959 267,003 Intangible assets 17 208 203 198 Right-of-use assets 18 2,482 2,442 3,301 Properties held for development 19 1,208 1,207 1,200 Joint venture companies 20 24,589 21,935 15,744 Loans due from joint venture companies 20 15,273 15,619 15,357 Associated companies 21 473 461 543 Loans due from associated companies 21 52 – – Derivative financial instruments 30 96 133 145 Deferred tax assets 31 64 78 73 Financial assets at fair value through profit or loss 460 439 985 Other financial assets at amortised cost 32 – 522 508 Retirement benefit assets 34 14 – – Current assets 319,452 314,379 309,379 Properties for sale 23 8,264 6,411 3,538 Stocks 72 71 72 Trade and other receivables 24 2,834 2,220 2,127 Amounts due from immediate holding company – Swire Pacific Limited 25 – 1 16 Derivative financial instruments 30 – 19 – Short-term deposits maturing after three months – – 30 Cash and cash equivalents 26 4,502 14,833 21,202 Assets classified as held for sale 15,672 23,555 26,985 33 2,038 1,740 384 Current liabilities 17,710 25,295 27,369 Trade and other payables 27 10,008 9,339 8,001 Contract liabilities 14 120 22 Taxation payable 185 348 576 Derivative financial instruments 30 – 7 – Short-term loans – – 94 Long-term loans and bonds due within one year 29 700 9,000 1,820 Lease liabilities due within one year 28 79 49 70 10,986 18,863 10,583 Net current assets 6,724 6,432 16,786 Total assets less current liabilities 326,176 320,811 326,165 Non-current liabilities Long-term loans and bonds 29 22,135 15,601 25,343 Long-term lease liabilities 28 535 517 510 Derivative financial instruments 30 – – 42 Other payables 27 – 150 – Deferred tax liabilities 31 11,248 10,746 9,991 Retirement benefit liabilities 34 – 187 135 33,918 27,201 36,021 NET ASSETS 292,258 293,610 290,144 EQUITY Share capital 35 10,449 10,449 10,449 Reserves 36 278,762 281,175 277,767 Equity attributable to the Company’s shareholders 289,211 291,624 288,216 Non-controlling interests 38 3,047 1,986 1,928 TOTAL EQUITY 292,258 293,610 290,144 Guy Bradley May Y. Wu Directors Hong Kong, 9th March 2023 The above consolidated statement of financial position should be read in conjunction with the accompanying notes. 136

CONSOLIDATED STATEMENT OF CASH FLOWS For the year ended 31st December 2022 2022 2021 Note HK$M HK$M Operating activities Cash generated from operations 43(a) 6,332 7,028 Interest paid (742) (768) Interest received 117 203 Tax paid (1,127) (1,635) 4,580 4,828 Dividends received from joint venture and associated companies and financial assets at fair value through other comprehensive income 176 217 Net cash from operating activities 4,756 5,045 Investing activities Purchase of property, plant and equipment 43(b) (133) (180) Additions of investment properties (7,096) (3,860) Purchase of intangible assets (58) (52) Proceeds from disposal of property, plant and equipment – 889 Proceeds from disposal of investment properties 609 2,869 Proceeds from disposal of subsidiary companies, net of cash disposed of 43(c) 1,060 212 Proceeds from disposal of financial assets at fair value through profit or loss – 973 Purchase of shares in joint venture companies (1,720) – Purchase of financial assets at fair value through profit or loss (20) (390) Equity to joint venture companies (1,123) (3,986) Loans to joint venture companies (108) (787) Repayment of loans by joint venture companies 917 613 Advances from joint venture companies – 479 Repayment of advances from joint venture companies (200) – Loans to associated companies (52) – Decrease in deposits maturing after three months – 30 Initial leasing costs incurred (75) (6) Net cash used in investing activities (7,999) (3,196) Net cash (outflow)/inflow before financing activities (3,243) 1,849 Financing activities Loans drawn and refinanced 7,237 1,400 Repayment of loans and bonds (9,009) (4,184) Principal elements of lease payments (66) (72) (1,838) (2,856) Capital contribution from a non-controlling interest 1,003 – Dividends paid to the Company’s shareholders 36 (5,616) (5,383) Dividends paid to non-controlling interests 38 (96) (132) Net cash used in financing activities (6,547) (8,371) Decrease in cash and cash equivalents (9,790) (6,522) Cash and cash equivalents at 1st January 14,833 21,202 Effect of exchange differences (541) 153 Cash and cash equivalents at 31st December 4,502 14,833 Represented by: Bank balances and short-term deposits maturing within three months 26 4,502 14,833 The above consolidated statement of cash flows should be read in conjunction with the accompanying notes. SWIRE PROPERTIES ANNUAL REPORT 2022 SWIRE PROPERTIES ANNUAL REPORT 2022 137

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY For the year ended 31st December 2022 Attributable to the Company’s shareholders Non- Share Revenue Other controlling Total capital reserve reserves Total interests equity Note HK$M HK$M HK$M HK$M HK$M HK$M At 1st January 2022 – as originally stated 10,449 277,961 3,745 292,155 2,003 294,158 – impact of adjustments in note 1(c) – (522) (9) (531) (17) (548) – as restated 10,449 277,439 3,736 291,624 1,986 293,610 Profit for the year – 7,980 – 7,980 247 8,227 Other comprehensive income – 205 (4,982) (4,777) (110) (4,887) Total comprehensive income for the year 36, 38 – 8,185 (4,982) 3,203 137 3,340 Capital contribution from a non-controlling interest – – – – 1,020 1,020 Dividends paid – (5,616) – (5,616) (96) (5,712) At 31st December 2022 10,449 280,008 (1,246) 289,211 3,047 292,258 Attributable to the Company’s shareholders Non- Share Revenue Other controlling Total capital reserve reserves Total interests equity Note HK$M HK$M HK$M HK$M HK$M HK$M At 1st January 2021 – as originally stated 10,449 276,245 2,042 288,736 1,944 290,680 – impact of adjustments in note 1(c) – (513) (7) (520) (16) (536) – as restated 10,449 275,732 2,035 288,216 1,928 290,144 Profit for the year (restated) – 7,112 – 7,112 167 7,279 Other comprehensive income (restated) – (22) 1,701 1,679 23 1,702 Total comprehensive income for the year (restated) 36, 38 – 7,090 1,701 8,791 190 8,981 Dividends paid – (5,383) – (5,383) (132) (5,515) At 31st December 2021 (restated) 10,449 277,439 3,736 291,624 1,986 293,610 The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes. 138

NOTES TO THE FINANCIAL STATEMENTS General Information The Company is a limited liability company incorporated in Hong Kong and its shares are listed on The Stock Exchange of Hong Kong Limited. The principal activity of the Company is that of a holding company. The principal activities of its major subsidiary, joint venture and associated companies are shown on pages 201 to 203. 1. Changes in Accounting Policies and Disclosures (a) The following revised standards were required to be adopted by the Group effective from 1st January 2022: Accounting Guideline 5 (Revised) Merger Accounting for Common Control Combinations Annual improvements project Annual Improvements to HKFRSs 2018-2020 Amendments to HKFRS 3, HKAS 16 and HKAS 37 Narrow-scope Amendments None of the revised standards had a significant effect on the Group’s consolidated financial statements or accounting policies. (b) The Group has not early adopted the following relevant new and revised standards and interpretations that have been issued but are effective for annual periods beginning on or after 1st January 2023 and such standards have not been applied in preparing these consolidated financial statements. 1 Amendments to HKAS 1, HKAS 8 and HKAS 12 Narrow-scope Amendments 1 Amendments to HKAS 1 and Disclosure of Accounting Policies HKFRS Practice Statement 2 HKFRS 17 and Amendments to HKFRS 17 Insurance Contracts1 1 HK(IFRIC)-Interpretation 22 Foreign Currency Transactions and Advance Consideration 2 Amendments to HKAS 1 Classification of Liabilities as Current and Non-current 2 Amendments to HKAS 1 Non-current Liabilities with Covenants 2 Amendments to HKFRS 16 Lease Liability in a Sale and Leaseback HK-Interpretation 5 (2020) Presentation of Financial Statements – Classification by the Borrower 2 of a Term Loan that Contains a Repayment on Demand Clause Amendments to HKFRS 10 and HKAS 28 Sale or Contribution of Assets between an Investor and its Associate or 3 Joint Venture 1 To be applied by the Group from 1st January 2023. 2 To be applied by the Group from 1st January 2024. 3 The effective date is to be determined. None of these new and revised standards and interpretations is expected to have a significant effect on the Group’s consolidated financial statements. (c) Change in accounting policy on lessor forgiveness of lease payments In October 2022, the IASB finalised the agenda decision approved by the IFRS Interpretation Committee (‘IFRS IC’) on “Lessor Forgiveness of Lease Payments (IFRS 9 and IFRS 16)”. The agenda decision addresses the accounting from the perspective of the lessor, and in particular: – how the expected credit loss (‘ECL’) model in IFRS 9 should be applied to the operating lease receivable when the lessor expects to forgive payments due from the lessee under the lease contract before the rent concession is granted; and – whether to apply the derecognition requirements in IFRS 9 or the lease modification requirements in IFRS 16 when accounting for the rent concession. The IFRS IC concluded that in reporting periods before the forgiveness of lease payments have been granted, the lessor should measure the ECL on operating lease receivables on a probability-weighted basis, by evaluating a range of possible outcomes, including its expectation of forgiving lease payments that have been recognised as an operating lease receivable. This is on the assumption that there is reasonable and supportable information, that is available without undue cost or effort, and that the expectation of forgiving the lease payments reflects a potential cash shortfall which should be taken into account in the ECL measurement. In previous years, all the rent concession granted to tenants were treated as lease modifications under HKFRS 16 and were amortised over the remaining periods of the leases. SWIRE PROPERTIES ANNUAL REPORT 2022 SWIRE PROPERTIES ANNUAL REPORT 2022 139

NOTES TO THE FINANCIAL STATEMENTS 1. Changes in Accounting Policies and Disclosures (continued) (c) Change in accounting policy on lessor forgiveness of lease payments (continued) The Group has changed its accounting policy having regard to the IASB agenda decision. In applying the requirements in HKFRS 9, the Group re-measures the ECL on its operating lease receivables immediately prior to the date the lease payments are forgiven, with any changes being recognised as rental outgoings in the consolidated statement of profit or loss. Once the lease payments are forgiven, the Group derecognises the operating lease receivable, including any associated ECL allowance. Lease payment forgiven that are not associated with operating lease receivables are recognised as lease modifications under HKFRS 16. The change in accounting policy has been applied retrospectively by restating the balances at 31st December 2021 and 1st January 2021, and the results for the year ended 31st December 2021: As previously Effect of As reported change restated HK$M HK$M HK$M Consolidated Statement of Profit or Loss and Other Comprehensive Income for the year ended 31st December 2021 Revenue 15,891 427 16,318 Cost of sales (5,369) (432) (5,801) Share of profit less losses of joint venture companies 1,870 (2) 1,868 Taxation (1,961) (3) (1,964) Profit for the year attributable to: – The Company’s shareholders 7,121 (9) 7,112 – Non-controlling interests 168 (1) 167 Net translation differences on foreign operations recognised during the year 1,095 (2) 1,093 Total comprehensive income attributable to: – The Company’s shareholders 8,802 (11) 8,791 – Non-controlling interests 191 (1) 190 Consolidated Statement of Financial Position at 31st December 2021 Assets Joint venture companies 21,999 (64) 21,935 Trade and other receivables 2,805 (585) 2,220 (649) Liabilities Deferred tax liabilities 10,847 (101) 10,746 (101) Equity Reserves 281,706 (531) 281,175 Non-controlling interests 2,003 (17) 1,986 (548) Consolidated Statement of Financial Position at 1st January 2021 Assets Joint venture companies 15,806 (62) 15,744 Trade and other receivables 2,704 (577) 2,127 (639) Liabilities Deferred tax liabilities 10,094 (103) 9,991 (103) Equity Reserves 278,287 (520) 277,767 Non-controlling interests 1,944 (16) 1,928 (536) 140

1. Changes in Accounting Policies and Disclosures (continued) (c) Change in accounting policy on lessor forgiveness of lease payments (continued) The change in accounting policy affected the following items in the consolidated statement of profit or loss and other comprehensive income for the year ended 31st December 2022 and the consolidated statement of financial position at 31st December 2022: Under previous accounting Effect of As policy change reported HK$M HK$M HK$M Consolidated Statement of Profit or Loss and Other Comprehensive Income for the year ended 31st December 2022 Revenue 13,421 405 13,826 Cost of sales (3,984) (319) (4,303) Share of profit less losses of joint venture companies 1,429 14 1,443 Taxation (2,046) (19) (2,065) Profit for the year attributable to: – The Company’s shareholders 7,902 78 7,980 – Non-controlling interests 244 3 247 Net translation differences on foreign operations recognised during the year (3,322) (1) (3,323) Total comprehensive income attributable to: – The Company’s shareholders 3,126 77 3,203 – Non-controlling interests 134 3 137 Consolidated Statement of Financial Position at 31st December 2022 Assets Joint venture companies 24,639 (50) 24,589 Trade and other receivables 3,334 (500) 2,834 (550) Liabilities Taxation payable 245 (60) 185 Deferred tax liabilities 11,270 (22) 11,248 (82) Equity Reserves 279,216 (454) 278,762 Non-controlling interests 3,061 (14) 3,047 (468) 2. Financial Risk Management Financial risk factors In the normal course of business the Group is exposed to financial risks attributable to interest rates, currencies, credit and liquidity. Management manages and monitors these exposures to ensure appropriate measures are implemented in a timely and effective manner. The Group’s overall risk management programme focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the Group’s financial performance. SWIRE PROPERTIES ANNUAL REPORT 2022 141

NOTES TO THE FINANCIAL STATEMENTS 2. Financial Risk Management (continued) (i) Interest rate exposure The Group’s interest rate risk arises primarily from borrowings. Borrowings at variable rates expose the Group to cash flow interest rate risk. Borrowings at fixed rates expose the Group to fair value interest rate risk. The Group earns interest income on cash deposits and some loans due from joint venture and associated companies. The Group uses interest rate swaps to manage its long-term interest rate exposure. The impact on the Group’s consolidated statements of profit or loss and other comprehensive income of a 100 basis-points increase or decrease in market interest rates from the rates applicable at 31st December, with all other variables held constant, would have been: 100 basis-points 100 basis-points increase in decrease in interest rates interest rates HK$M HK$M At 31st December 2022 Impact on profit or loss: (losses)/gains (34) 34 Impact on other comprehensive income: gains/(losses) 4 (3) At 31st December 2021 Impact on profit or loss: gains/(losses) 107 (74) Impact on other comprehensive income: gains/(losses) 33 (34) This analysis is based on a hypothetical situation, as in practice market interest rates rarely change in isolation, and should not be considered a projection of likely future profit or losses. The analysis assumes the following: – Changes in market interest rates affect the interest income or expense of floating rate financial instruments – Changes in market interest rates only affect interest income or expense in relation to fixed rate financial instruments if these are recognised at fair value – Changes in market interest rates affect the fair value of derivative financial instruments – All other financial assets and liabilities are held constant (ii) Currency exposure The Group operates internationally and is exposed to foreign exchange risk arising from various currency exposures, primarily with respect to US dollars and Chinese Renminbi. Foreign exchange risk arises from the foreign currency denomination of commercial transactions, assets and liabilities, and net investments in foreign operations. The Group is not subject to any significant foreign currency risk as the revenue, expenses and borrowings of the Group’s foreign operating subsidiaries are denominated in the functional currencies of those operations. However, the Group is exposed to insignificant foreign exchange risk on US dollar medium-term notes and the Group managed this exposure by hedging through cross-currency swap contracts entered by the Group. Exposure arising from the Group’s investments in operating subsidiaries with net assets denominated in foreign currencies is reduced, where practical, by providing funding in the same currency. Foreign currency funding and deposit exposure is monitored by the treasury department on a continuous basis. The Finance Director of the Group approve all foreign currency hedges prior to implementation. The impact on the Group’s consolidated statements of profit or loss and other comprehensive income of a strengthening or weakening in the Hong Kong dollar against the US dollar from the year-end rate of 7.7974 (2021: 7.7966), with all other variables held constant, would have been: 142

2. Financial Risk Management (continued) (ii) Currency exposure (continued) Strengthening in Weakening in HKD to lower HKD to upper peg limit (7.75) peg limit (7.85) HK$M HK$M At 31st December 2022 Impact on profit or loss – – Impact on other comprehensive income – – At 31st December 2021 Impact on profit or loss – – Impact on other comprehensive income: (losses)/gains (6) 7 The analysis is based on a hypothetical situation, as in practice market exchange rates rarely change in isolation, and should not be considered a projection of likely future profits or losses. The analysis assumes the following: – All foreign currency cash flow hedges are highly effective – Currency risk does not arise from financial assets or liabilities denominated in the functional currencies of the Company and its subsidiary companies – Currency risk does not arise from financial instruments that are non-monetary items (iii) Credit exposure The Group’s credit risk is primarily attributable to trade and other receivables, derivative financial instruments, receivables from joint venture companies and associated companies and cash and deposits with banks and financial institutions. Risk management The exposure to these credit risks is closely monitored on a continuous basis by reference to established credit policies. For banks and financial institutions, only independently rated parties with investment grade credit ratings are accepted as counterparties. Tenants are assessed and rated based on their credit quality, taking into account their financial position, past experience and other factors. The Group does not grant credit terms to its customers, except to corporate customers in the hotel division where commercial trade credit terms are given. The Group also holds non-interest-bearing rental deposits as security against trade debtors. In addition, the Group and the Company monitor the exposure to credit risk in respect of the financial assistance provided to subsidiaries, joint venture and associated companies through exercising control, joint control or significant influence over their financial and operating policy decisions and reviewing their financial positions on a regular basis. The Group has the following major types of assets that are subject to the expected credit loss model: – Trade receivables – Other financial assets at amortised cost Trade receivables The Group applies the HKFRS 9 simplified approach to measuring expected credit losses which uses a lifetime expected loss allowance for trade receivables. As the Group’s historical credit loss experience does not indicate different loss patterns for different customer segments, the loss allowance based on past due status is not further distinguished among the Group’s different customer segments. The expected loss rates are based on historical payment profiles. These rates are adjusted to reflect current and forward-looking information about economic conditions. Trade receivables are written off when there is no reasonable expectation of recovery. Indicators include the failure of a debtor to engage in a repayment plan with the Group, and a failure to make contractual payments for a period of greater than 120 days past due. Impairment charges on trade receivables are presented as net impairment losses within operating profit. Subsequent recoveries of amounts previously written off are credited to the same line item. Other financial assets at amortised cost Other financial assets at amortised cost include other receivables and loans due from related parties. Loans due from joint venture, associated and other related companies are considered to have low credit risk as the financial positions and performances of these companies are regularly monitored and reviewed by management of the Group. SWIRE PROPERTIES ANNUAL REPORT 2022 SWIRE PROPERTIES ANNUAL REPORT 2022 143

NOTES TO THE FINANCIAL STATEMENTS 2. Financial Risk Management (continued) (iv) Liquidity exposure The Group takes liquidity risk into consideration when deciding its sources of funds and their tenors, so as to avoid over reliance on funds from any one source and to prevent substantial refinancing in any one period. Cash flow forecasting is performed in the operating entities of the Group and aggregated by the head office. The head office monitors rolling forecasts of the Group’s liquidity requirements to ensure it has sufficient cash to meet operational needs while maintaining sufficient headroom on its undrawn committed borrowing facilities at all times so that the Group does not breach borrowing limits or covenants (where applicable) on any of its borrowing facilities. Such forecasting takes into consideration the Group’s debt financing plans, covenant compliance, compliance with internal balance sheet ratio targets and, if applicable, external regulatory or legal requirements. The tables below analyse the contractual undiscounted cash flows of the Group’s non-derivative financial liabilities and net- settled derivative financial liabilities by relevant maturity groupings based on the remaining periods at the year-end date to the earliest contractual maturity dates. At 31st December 2022 Total More than More than contractual Within 1 year but 2 years but Carrying undiscounted 1 year or less than less than More than Note amount cash flow on demand 2 years 5 years 5 years HK$M HK$M HK$M HK$M HK$M HK$M Trade creditors 27 812 812 812 – – – Rental deposits from tenants 27 2,715 2,715 840 551 1,011 313 Other payables 27 5,890 5,890 5,890 – – – Put option in respect of a non-controlling interest 27 590 590 590 – – – Lease liabilities 28 614 715 98 89 228 300 Borrowings (including interest obligations) 29 22,835 25,520 1,369 2,518 16,496 5,137 Financial guarantee contracts 40 – 4,254 4,254 – – – 33,456 40,496 13,853 3,158 17,735 5,750 At 31st December 2021 Total More than More than contractual Within 1 year but 2 years but Carrying undiscounted 1 year or less than less than More than Note amount cash flow on demand 2 years 5 years 5 years HK$M HK$M HK$M HK$M HK$M HK$M Trade creditors 27 721 721 721 – – – Rental deposits from tenants 27 2,782 2,782 754 609 984 435 Other payables 27 5,425 5,432 5,278 52 102 – Put option in respect of a non-controlling interest 27 551 551 551 – – – Lease liabilities 28 566 682 66 69 166 381 Borrowings (including interest obligations) 29 24,601 27,086 9,584 679 9,358 7,465 Derivative financial instruments 30 7 7 7 – – – Financial guarantee contracts 40 – 3,719 3,719 – – – 34,653 40,980 20,680 1,409 10,610 8,281 144

3. Critical Accounting Estimates and Judgements Estimates and judgements used in preparing the financial statements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. The Group makes estimates and assumptions concerning the future. The resulting accounting estimates will, inevitably, seldom be equal to the related actual results. The estimates and assumptions that have a significant effect on the carrying amounts of assets and liabilities are discussed in the relevant notes as follows: (a) Impairment of property, plant and equipment (note 15) (b) Fair value of investment properties (note 16) (c) Retirement benefits (note 34) 4. Revenue Accounting Policy Revenue is recognised when a customer obtains control of a good or service and thus has the ability to direct the use and obtain benefits from the good or service. Provided the collectability of the related receivable is probable, revenue is recognised as follows: (a) Rental income is recognised when a lease commences. According to the contractual terms, leased properties do not have alternative uses to the Group after the leasing period stipulated in the signed tenancy agreements commence. Rental income is recognised on a straight-line basis over the shortest of (i) the remaining lease term, (ii) the period to the next rent review date and (iii) the period from the commencement date of the lease to the first break option date (if any), exclusive of any turnover rent (if applicable) and other charges and reimbursements (if any). Where the lease includes a rent-free period, the rental income foregone is allocated evenly over the lease term. Turnover rent is recognised when the lessee’s revenue transaction is recognised. Rental income forgiven (not recognised as an expected credit loss of operating lease receivables) is treated as a lease modification, and the revised future lease income under the new lease, including any prepaid or accrued lease income relating to the original lease is subsequently recognised as income on a straight-line basis. (b) The Group develops and sells residential properties. Revenue is recognised when control over the property has been transferred to the buyers. According to the contractual terms, the properties generally do not have alternative uses to the Group after the signing of sales contracts with the buyers. However, in Hong Kong and the U.S.A., an enforceable right to payment does not arise until legal title of the property has been transferred to the buyer. Therefore, revenue is recognised upon completion of the transfer of legal title to the buyer. Revenue from sales of properties in Singapore is recognised over time because, after the signing of a sales contract with the buyer, the Group has an enforceable right to payment for performance completed to date. Revenue from sales of these properties is recognised based on the stage of completion of the contract using the input method. (c) Sale of goods are recognised when the goods are delivered to the customer and the customer has accepted the related risks and rewards of ownership. Sales of food and beverages happen at a point in time and do not include any significant separate performance obligations. (d) Sales of services, including services provided by hotel operations and estate management, are recognised when the services are rendered. Revenue is recognised over time rather than at a point in time. The Group does not expect to have any contracts where the period between the transfer of the promised goods or services to the customer and payment by the customer exceeds one year. As a consequence, the Group does not adjust transaction prices for the time value of money. SWIRE PROPERTIES ANNUAL REPORT 2022 145

NOTES TO THE FINANCIAL STATEMENTS 4. Revenue (continued) Accounting Policy (continued) Definition of terms Contract asset: An entity’s right to consideration in exchange for goods or services that the entity has transferred to a customer when that right is conditional on something other than the passage of time (for example, the entity’s future performance). Contract liability: An entity’s obligation to transfer goods or services to a customer for which the entity has received consideration from the customer. When the Group enters into sale and purchase contracts for properties or sale contracts for services other than tenancy agreements, if the performance obligations fulfilled by the Group exceed the total payments received to date, a contract asset is recognised; if the total payments received to date exceed the performance obligation fulfilled, a contract liability is recognised. Deposits received upon signing of sale and purchase contracts, or sale contracts are recognised as contract liabilities. Direct costs incurred to obtain a contract are capitalised if the Group expects to recover those costs. Costs of obtaining a contract are amortised on a straight-line basis over the expected life of the contract. The Group has elected to adopt the practical expedient to expense such direct costs to profit or loss since the period of amortisation is generally one year or less with no material impact to the Group. Contract asset and contract liability are defined in HKFRS 15 “Revenue from Contracts with Customers”. These two terms do not apply to rental income from lease agreements, which is specifically excluded from the scope of HKFRS 15. Revenue represents sales by the Company and its subsidiary companies to external customers and comprises: 2022 2021 HK$M HK$M Restated Gross rental income from investment properties 12,226 12,879 Property trading 921 2,443 Hotels 565 894 Rendering of other services 114 102 13,826 16,318 2022 2021 HK$M HK$M Revenue recognised in the current reporting period that was related to the contract liability balance at the beginning of the year 120 4 Of the contract liabilities of HK$14 million outstanding at 31st December 2022 (2021: HK$120 million), HK$14 million (2021: HK$120 million) is expected to be recognised as revenue within one year. The following table shows unsatisfied performance obligations resulting from contracts with customers. 2022 2021 HK$M HK$M Aggregate amount of the transaction price allocated to revenue contracts that are partially or fully unsatisfied at the end of the year 90 992 Of the amount disclosed above at 31st December 2022, HK$90 million (2021: HK$992 million) is expected to be recognised as revenue within one year. 146

5. Cost of Sales 2022 2021 HK$M HK$M Restated Direct rental outgoings in respect of investment properties that – generated rental income 2,798 2,885 – did not generate rental income 199 177 2,997 3,062 Property trading 621 1,856 Hotels 685 883 4,303 5,801 6. Other Net Gains 2022 2021 HK$M HK$M Gains on disposal of investment properties 31 1,028 Gains on disposal of property, plant and equipment – 9 Gains on disposal of assets classified as held for sale 20 36 Change in fair value of assets classified as held for sale 48 42 Change in fair value of financial assets at fair value through profit or loss – (12) Net foreign exchange (losses)/gains (107) 60 Government subsidies 31 15 Others 56 53 79 1,231 7. Expenses by Nature Expenses included in cost of sales, administrative and selling expenses, and other operating expenses are analysed as follows: 2022 2021 HK$M HK$M Restated Impairment charged on trade receivables* 341 466 Depreciation of property, plant and equipment (note 15) 232 273 Depreciation of right-of-use assets – leasehold land held for own use 25 27 – property 39 38 Amortisation of – intangible assets (note 17) 53 47 – initial leasing costs in respect of investment properties 79 35 Staff costs 1,899 1,965 Other lease expenses** 32 32 Auditors’ remuneration – audit services 11 11 – tax services 3 5 – other services 3 2 * These impairments include ECL on the operating lease receivables in relation to the forgiveness of lease payments, i.e. rent concessions granted to tenants during the year, under HKFRS 9 of HK$319 million (2021 (Restated): HK$432 million). ** These expenses relate to short-term leases and leases of low-value assets, net of rent concessions received (2022: nil; 2021: HK$1 million). They are directly charged to the consolidated statement of profit or loss and are not included in the measurement of lease liabilities under HKFRS 16. SWIRE PROPERTIES ANNUAL REPORT 2022 147

NOTES TO THE FINANCIAL STATEMENTS 8. Segment Information The Group is organised on a divisional basis: Property investment, Property trading and Hotels. The reportable segments within each of the three divisions are classified according to the nature of the business. Accounting Policy Segment information is reported in a manner consistent with the Group’s internal financial reporting provided to the Executive Directors for making strategic decisions. A reportable segment comprises either one or more operating segments which can be aggregated together because they share similar economic characteristics or single operating segments which are discloseable separately because they cannot be aggregated or because they exceed certain quantitative thresholds. (a) Information about reportable segments Analysis of Consolidated Statement of Profit or Loss Operating Share of Profit/ Depreciation profit/(losses) profit less Share of (Losses) and Inter- after losses of profit less Profit/ attributable amortisation External segment depreciation joint losses of (Losses) Profit/ to the charged to revenue revenue and Finance Finance venture associated before (Losses) for Company’s operating HK$M HK$M amortisation charges income companies companies taxation Taxation the year shareholders profit HK$M HK$M HK$M HK$M HK$M HK$M HK$M HK$M HK$M HK$M Year ended 31st December 2022 Property investment 12,340 3 8,273 (359) 171 1,018 – 9,103 (974) 8,129 8,025 (247) Property trading 921 – 209 – 1 (18) 66 258 (87) 171 171 – Hotels 565 4 (259) – – (67) (54) (380) 38 (342) (341) (181) Change in fair value of investment properties – – 801 – – 510 – 1,311 (1,042) 269 125 – Inter-segment elimination – (7) – – – – – – – – – – 13,826 – 9,024 (359) 172 1,443 12 10,292 (2,065) 8,227 7,980 (428) Year ended 31st December 2021 (Restated) Property investment 12,981 3 9,463 (582) 229 1,004 – 10,114 (1,353) 8,761 8,654 (208) Property trading 2,443 – 492 (11) 1 120 – 602 2 604 601 – Hotels 894 4 (174) (14) – (70) (82) (340) 31 (309) (307) (212) Change in fair value of investment properties – – (1,947) – – 814 – (1,133) (644) (1,777) (1,836) – Inter-segment elimination – (7) – – – – – – – – – – 16,318 – 7,834 (607) 230 1,868 (82) 9,243 (1,964) 7,279 7,112 (420) Note: Sales between business segments are accounted for at competitive prices charged to unaffiliated customers for similar goods and services. 148

8. Segment Information (continued) (a) Information about reportable segments (continued) Analysis of total assets of the Group Joint Bank Additions to Segment venture Associated deposits Total non-current assets companies* companies* and cash assets assets (Note) HK$M HK$M HK$M HK$M HK$M HK$M At 31st December 2022 Property investment 278,255 35,439 – 4,252 317,946 7,689 Property trading 9,911 2,762 285 164 13,122 – Hotels 4,107 1,661 240 86 6,094 34 292,273 39,862 525 4,502 337,162 7,723 At 31st December 2021 (Restated) Property investment 274,194 33,428 – 14,161 321,783 4,374 Property trading 8,058 2,717 219 548 11,542 – Hotels 4,574 1,409 242 124 6,349 122 286,826 37,554 461 14,833 339,674 4,496 * The assets relating to joint venture and associated companies include the loans due from these companies. Note: In this analysis, additions to non-current assets during the year exclude joint venture and associated companies, financial assets at fair value through profit or loss and other comprehensive income, financial instruments, deferred tax assets, retirement benefit assets and other financial assets at amortised cost. Analysis of total liabilities and non-controlling interests of the Group Current and Non- Segment deferred tax External Lease Total controlling liabilities liabilities borrowings liabilities liabilities interests HK$M HK$M HK$M HK$M HK$M HK$M At 31st December 2022 Property investment 8,529 11,413 14,685 614 35,241 3,017 Property trading 1,326 20 7,782 – 9,128 2 Hotels 167 – 368 – 535 28 10,022 11,433 22,835 614 44,904 3,047 At 31st December 2021 (Restated) Property investment 8,303 11,073 18,839 566 38,781 1,952 Property trading 1,336 21 5,412 – 6,769 2 Hotels 164 – 350 – 514 32 9,803 11,094 24,601 566 46,064 1,986 SWIRE PROPERTIES ANNUAL REPORT 2022 149

NOTES TO THE FINANCIAL STATEMENTS 8. Segment Information (continued) (a) Information about reportable segments (continued) Analysis of external revenue of the Group – Timing of revenue recognition Rental At a point income in time Over time on leases Total HK$M HK$M HK$M HK$M Year ended 31st December 2022 Property investment – 114 12,226 12,340 Property trading 921 – – 921 Hotels 331 234 – 565 1,252 348 12,226 13,826 Year ended 31st December 2021 (Restated) Property investment – 102 12,879 12,981 Property trading 2,443 – – 2,443 Hotels 478 416 – 894 2,921 518 12,879 16,318 (b) Information about geographical areas The activities of the Group are principally based in Hong Kong, the Chinese Mainland and the U.S.A. An analysis of revenue and non-current assets of the Group by principal markets is outlined below: Revenue Non-current assets (Note) 2022 2021 2022 2021 HK$M HK$M HK$M HK$M Restated Hong Kong 9,319 9,108 229,330 228,318 Chinese Mainland 3,648 3,913 42,612 40,766 U.S.A. and elsewhere 859 3,297 6,489 6,108 13,826 16,318 278,431 275,192 Note: In this analysis, the total of non-current assets exclude joint venture and associated companies, financial assets at fair value through profit or loss and other comprehensive income, financial instruments, deferred tax assets, retirement benefit assets and other financial assets at amortised cost. Of the joint venture and associated companies balances, HK$7,668 million (2021 (Restated): HK$7,100 million) is based in Hong Kong, HK$16,797 million (2021 (Restated): HK$14,933 million) is based in the Chinese Mainland and HK$597 million (2021: HK$363 million) is based in U.S.A. and elsewhere. 150

9. Directors’ and Executive Officers’ Emoluments (a) The total emoluments of Directors of the Company disclosed pursuant to section 383 (1) of the Hong Kong Companies Ordinance and the Companies (Disclosure of Information about Benefits of Directors) Regulation are as follows: Cash Non-cash Discretionary bonus paid Housing Discretionary Retirement into and other bonus Allowance scheme retirement benefits Total Total Salary Fees (note (i)) and benefits contributions scheme (note (ii)) 2022 2021 HK$’000 HK$’000 HK$’000 HK$’000 HK$’000 HK$’000 HK$’000 HK$’000 HK$’000 For the year ended 31st December 2022 Executive Directors G.M.C. Bradley (Chairman) (note (iii)) 578 – 202 10 127 202 800 1,919 11,334 M.B. Swire (note (iv)) – – – – – – – – – T.J. Blackburn (note (v)) 3,267 – 1,069 3,241 719 1,069 358 9,723 2,770 F.N.Y. Lung 3,740 – 1,521 1,179 976 – – 7,416 7,006 M.S.C. Ma (note (vi)) 3,298 – 2,347 798 448 – 99 6,990 1,478 Non-Executive Directors N.A.H. Fenwick – – – – – – – – – R.S.K. Lim – 575 – – – – – 575 575 M.J. Murray (note (vii)) – – – – – – – – – M.B. Swire (note (iv)) – – – – – – – – – P. Healy (note (viii)) – – – – – – – – – M.M.S. Low (note (ix)) – – – – – – – – – Independent Non-Executive Directors L.K.L. Cheng – 761 – – – – – 761 761 T.T.K. Choi – 684 – – – – – 684 635 S.T. Fung – 726 – – – – – 726 658 J.L. Wang – 575 – – – – – 575 575 M.Y. Wu – 843 – – – – – 843 843 Total 2022 10,883 4,164 5,139 5,228 2,270 1,271 1,257 30,212 N/A Total 2021 9,294 4,047 3,351 3,252 1,996 1,914 2,781 N/A 26,635 Notes: (i) The bonuses disclosed above are related to services as Executive Directors for the previous year. (ii) Other benefits include medical and insurance benefits and overseas tax subsidies. (iii) G.M.C. Bradley was Chief Executive until 24th August 2021 and was elected as Chairman with effect from 25th August 2021. (iv) M.B. Swire was Chairman and an Executive Director until 24th August 2021 and was re-designated as a Non-Executive Director with effect from 25th August 2021. (v) T.J. Blackburn was appointed as an Executive Director and became Chief Executive with effect from 25th August 2021. (vi) M.S.C. Ma was appointed as an Executive Director on 25th August 2021. (vii) M.J. Murray was appointed as a Non-Executive Director on 1st April 2021. (viii) P. Healy resigned as a Non-Executive Director on 24th August 2021. (ix) M.M.S. Low resigned as a Non-Executive Director on 31st March 2021. SWIRE PROPERTIES ANNUAL REPORT 2022 151

NOTES TO THE FINANCIAL STATEMENTS 9. Directors’ and Executive Officers’ Emoluments (continued) (b) Five highest paid individuals The five individuals whose emoluments were the highest in the Group are as follows: Year ended 31st December 2022 2021 Number of individuals: Executive Directors (note (i)) 3 1 Executive Officers (note (ii)) 2 4 5 5 Notes: (i) Details of the emoluments paid to these Executive Directors are included in the disclosure set out in note 9(a) above. (ii) Details of the emoluments paid to the above executive officers are as follows. For the year ended 31st December 2021, an Executive Officer was appointed as an Executive Director with effect from 25th August 2021. Details of the aggregate of the emoluments paid to this Executive Director (including the emoluments paid to this Executive Director and disclosed in note 9(a) above) and the other three highest paid Executive Officers are as follows. Year ended 31st December 2022 2021 HK$’000 HK$’000 Cash: Salary 5,626 10,194 Discretionary bonus (Note) 3,340 5,155 Allowance and benefits 676 3,690 Non-cash: Retirement scheme contributions 765 1,656 Bonus paid into retirement scheme – 659 Housing and other benefits 4,899 13,089 15,306 34,443 Note: The bonuses disclosed above are related to services for the previous year. The number of the above Executive Officers whose emoluments fell within the following bands: Year ended 31st December 2022 2021 HK$10,000,001 – HK$10,500,000 – 1 HK$9,500,001 – HK$10,000,000 – 1 HK$8,500,001 – HK$9,000,000 1 – HK$7,000,001 – HK$7,500,000 – 2 HK$6,500,001 – HK$7,000,000 1 – 2 4 152

10. Net Finance Charges Accounting Policy Interest costs incurred are charged to the consolidated statement of profit or loss except for those interest charges attributable to the acquisition, construction or production of qualifying assets (i.e. assets that necessarily take a substantial period of time to get ready for their intended use or sale) which are recognised as part of the cost of those assets. Capitalisation of such borrowing costs ceases when the assets are substantially ready for their intended use or sale. Interest income on financial assets at fair value through profit or loss (“FVPL”) is included in the net fair value gains/(losses) on these assets. Interest income on financial assets at amortised cost and financial assets at fair value through other comprehensive income (“FVOCI”) calculated using the effective interest method is recognised on a time proportion basis in the consolidated statement of profit or loss as part of finance income. Interest income is presented as finance income where it is earned from financial assets that are held for cash management purposes. Any other interest income is included in other net gains/(losses). Interest income is calculated by applying the effective interest rate to the gross carrying amount of a financial asset except for financial assets that subsequently become credit-impaired. For credit-impaired financial assets the effective interest rate is applied to the net carrying amount of the financial asset (after deduction of the loss allowance). Refer to the table with heading “Audited Financial Information” on page 86 for details of the Group’s net finance charges. 11. Taxation Accounting Policy The tax charge comprises current and deferred tax. The tax charge is recognised in the consolidated statement of profit or loss, except to the extent that it relates to items recognised in the consolidated statement of other comprehensive income or directly to equity. The current tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the end of the reporting period in the countries where the Company and its subsidiaries operate and generate taxable income. Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation. It establishes provisions where appropriate on the basis of amounts expected to be paid to the tax authorities. 2022 2021 HK$M HK$M HK$M HK$M Restated Restated Current taxation Hong Kong profits tax 401 780 Overseas tax 590 627 (Over)/Under-provisions in prior years (5) 4 986 1,411 Deferred taxation (note 31) Change in fair value of investment properties 472 437 Origination and reversal of temporary differences 598 116 Effect of change in tax rate in the U.S.A. 9 – 1,079 553 2,065 1,964 Hong Kong profits tax is calculated at 16.5% (2021: 16.5%) on the estimated assessable profits for the year. Overseas tax is calculated at tax rates applicable in jurisdictions in which the Group is assessable for tax. SWIRE PROPERTIES ANNUAL REPORT 2022 153

NOTES TO THE FINANCIAL STATEMENTS 11. Taxation (continued) The tax charge on the Group’s profit before taxation differs from the theoretical amount that would arise using the Hong Kong profits tax rate of the Company as follows: 2022 2021 HK$M HK$M Restated Profit before taxation 10,292 9,243 Calculated at a tax rate of 16.5% (2021: 16.5%) 1,698 1,525 Share of results of joint venture and associated companies (240) (295) Effect of different tax rates in other countries 350 377 Effect of change in tax rate in the U.S.A. 9 – Fair value losses on investment properties 189 595 Income not subject to tax (107) (278) Expenses not deductible for tax purposes 95 20 Unused tax losses not recognised 39 59 Utilisation of previously unrecognised tax losses (3) (80) Recognition of previously unrecognised tax losses (6) (53) Withholding tax 46 90 (Over)/Under-provisions in prior years (5) 4 Tax charge 2,065 1,964 The Group’s share of joint venture companies’ tax charges of HK$526 million (2021 (Restated): HK$537 million) and share of associated companies’ tax charges of HK$40 million (2021: tax credits of HK$14 million) respectively are included in the share of results of joint venture and associated companies shown in the consolidated statement of profit or loss. 12. Profit Attributable to the Company’s Shareholders Of the profit attributable to the Company’s shareholders, HK$25,282 million (2021: HK$5,629 million) is dealt with in the financial statements of the Company. 13. Dividends Accounting Policy Dividend distributions to the Company’s shareholders are recognised as a liability in the Group’s financial statements in the period in which the dividends are approved by the Company’s shareholders or declared by the Company’s Directors, where appropriate. 2022 2021 HK$M HK$M First interim dividend paid on 6th October 2022 of HK$0.32 per share (2021: HK$0.31) 1,872 1,814 Second interim dividend declared on 9th March 2023 of HK$0.68 per share (2021: HK$0.64) 3,978 3,744 5,850 5,558 The second interim dividend is not accounted for in 2022 because it had not been declared or approved at the year-end date. The actual amount payable in respect of 2022 will be accounted for as an appropriation of the revenue reserve in the year ending 31st December 2023 when declared. 154

14. Earnings Per Share (Basic and Diluted) Earnings per share is calculated by dividing the profit attributable to the Company’s shareholders of HK$7,980 million (2021 (Restated): HK$7,112 million) by the daily weighted average number of 5,850,000,000 ordinary shares in issue during 2022 (2021: 5,850,000,000 ordinary shares). 15. Property, Plant and Equipment Accounting Policy Property, plant and equipment is carried at cost less accumulated depreciation and impairment. Cost includes expenditure that is directly attributable to the acquisition of the items. Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. With the exception of freehold land, all other items of property, plant and equipment are depreciated at rates sufficient to write off their original costs to estimated residual values using the straight-line method over their anticipated useful lives in the following manner: Buildings 2% to 5% per annum Plant and equipment 10% to 331/3% per annum The assets’ expected useful lives and residual values are regularly reviewed and adjusted, if appropriate, at the end of each reporting period to take into account operational experience and changing circumstances. On the transfer of owner-occupied property to investment property, increases in the carrying amount arising on revaluation of land and buildings are credited to the consolidated statement of other comprehensive income and shown as property revaluation reserve in shareholders’ equity. Decreases that offset previous increases of the same asset are charged in the consolidated statement of other comprehensive income and debited against property revaluation reserve directly in equity; all other decreases are charged to the consolidated statement of profit or loss. Gains and losses on disposals are determined by comparing the proceeds with the carrying amounts and are recognised within other net gains/(losses) in the consolidated statement of profit or loss. When revalued assets are sold, the amounts included in the property revaluation reserve are transferred to revenue reserve. Critical Accounting Estimates and Judgements At each reporting date or whenever a change in circumstances occurs, both internal and external sources of information are considered to assess whether there is an indication that assets are impaired. If such an indication exists, the recoverable amount of the asset is estimated using fair value less costs of disposal and/or value in use calculations as appropriate. If the carrying amount of an asset exceeds its recoverable amount, an impairment charge is recognised to reduce the asset to its recoverable amount. Such impairment charges are recognised in the consolidated statement of profit or loss within other net gains/(losses). SWIRE PROPERTIES ANNUAL REPORT 2022 155

NOTES TO THE FINANCIAL STATEMENTS 15. Property, Plant and Equipment (continued) Land and Plant and buildings equipment Total HK$M HK$M HK$M Cost: At 1st January 2022 4,307 1,978 6,285 Translation differences (152) (69) (221) Additions 10 115 125 Disposals – (12) (12) At 31st December 2022 4,165 2,012 6,177 Accumulated depreciation and impairment: At 1st January 2022 1,353 1,551 2,904 Translation differences (61) (51) (112) Charge for the year (note 7) 106 126 232 Disposals – (12) (12) At 31st December 2022 1,398 1,614 3,012 Net book value: At 31st December 2022 2,767 398 3,165 At 31st December 2022 and 2021, none of the Group’s property, plant and equipment was pledged as security for the Group’s long-term loans. Refer to the table with heading “Audited Financial Information” on page 86 for details of the Group’s capitalised interest rates and the amount of interest capitalised. Land and Plant and buildings equipment Total HK$M HK$M HK$M Cost: At 1st January 2021 5,479 1,818 7,297 Translation differences 68 17 85 Additions 9 181 190 Disposals (1,216) (38) (1,254) Net transfers to investment properties (note 16) (49) – (49) Revaluation surplus 16 – 16 At 31st December 2021 4,307 1,978 6,285 Accumulated depreciation and impairment: At 1st January 2021 1,521 1,454 2,975 Translation differences 25 13 38 Charge for the year (note 7) 152 121 273 Disposals (337) (37) (374) Transfers to investment properties (note 16) (8) – (8) At 31st December 2021 1,353 1,551 2,904 Net book value: At 31st December 2021 2,954 427 3,381 156

16. Investment Properties Accounting Policy Investment property comprises freehold land, leasehold land and buildings held for long-term rental yields or for capital appreciation or for both, and that are not occupied by the Group. Property held by the lessee as a right-of-use asset is classified and accounted for as an investment property when the rest of the definition of investment property is met. Investment properties (including those under development) are carried at fair value and are valued twice a year. The majority of investment properties are valued by independent valuers. The valuations are performed in accordance with the HKIS Valuation Standards 2020 published by The Hong Kong Institute of Surveyors and are on the basis of market value related to individual properties, and separate values are not attributed to land and buildings. These values represent their fair values in accordance with HKFRS 13. Land and buildings that are being developed for future use as investment properties and investment properties that are being redeveloped for continuing use as investment properties are measured at fair value and included as investment properties under development. Changes in fair values are recognised in the consolidated statement of profit or loss. Subsequent expenditure is charged to an investment property’s carrying amount only when it is probable that future economic benefits associated with that expenditure will flow to the Group and the cost can be measured reliably. All other repair and maintenance costs in respect of an investment property are expensed in the consolidated statement of profit or loss during the financial period in which they are incurred. If an investment property becomes owner-occupied, it is reclassified as property, plant and equipment or leasehold land under right-of-use assets, and its fair value at the date of reclassification becomes its deemed cost for accounting purposes. Expenditure incurred in leasing out the Group’s investment properties during development is deferred and amortised on a straight-line basis in the consolidated statement of profit or loss upon occupation of the property over a period not exceeding the term of the leases. Critical Accounting Estimates and Judgements Cushman & Wakefield Limited, an independent property valuer, was engaged to carry out a valuation of the major portion of the Group’s investment property portfolio at 31st December 2022. This valuation was carried out in accordance with the HKIS Valuation Standards 2020 published by The Hong Kong Institute of Surveyors, which define market value as “the estimated amount for which an asset or liability should exchange on the valuation date between a willing buyer and a willing seller in an arm’s length transaction, after proper marketing and where the parties each acted knowledgeably, prudently and without compulsion”. The assumptions are principally in respect of market rents and yields. Management has reviewed the independent property valuation and compared it with its own assumptions, with reference to comparable sales transaction data where such information is available, and has concluded that the independent property valuation of the Group’s investment property portfolio is reasonable. SWIRE PROPERTIES ANNUAL REPORT 2022 157

NOTES TO THE FINANCIAL STATEMENTS 16. Investment Properties (continued) Under Completed Development Total HK$M HK$M HK$M At 1st January 2022 236,703 31,112 267,815 Translation differences (3,279) (170) (3,449) Additions 935 6,806 7,741 Cost written back (367) (53) (420) Disposals (269) – (269) Transfer between categories 15,629 (15,629) – Net transfers from right-of-use assets – 2 2 Transfer to assets classified as held for sale (474) – (474) Disposal of subsidiary companies – (556) (556) Net fair value (losses)/gains (764) 1,565 801 248,114 23,077 271,191 Add: Initial leasing costs 177 – 177 At 31st December 2022 248,291 23,077 271,368 At 1st January 2021 239,493 27,338 266,831 Translation differences 1,142 13 1,155 Additions 1,191 3,056 4,247 Cost written back (6) – (6) Disposals (1,603) – (1,603) Transfer between categories 1,131 (1,131) – Net transfers from property, plant and equipment (note 15) 41 – 41 Net transfers from right-of-use assets 242 633 875 Transfer to assets classified as held for sale (1,646) – (1,646) Disposal of subsidiary companies – (132) (132) Net fair value (losses)/gains (3,282) 1,335 (1,947) 236,703 31,112 267,815 Add: Initial leasing costs 144 – 144 At 31st December 2021 236,847 31,112 267,959 158

16. Investment Properties (continued) Geographical Analysis of Investment Properties 2022 2021 HK$M HK$M Held in Hong Kong On medium-term leases (10 to 50 years) 30,688 31,586 On long-term leases (over 50 years) 194,283 192,378 224,971 223,964 Held in the Chinese Mainland On short-term leases (less than 10 years) 49 – On medium-term leases (10 to 50 years) 41,122 39,207 41,171 39,207 Held in the U.S.A. Freehold 5,049 4,644 271,191 267,815 Additions include capital expenditure in response to climate change. Such expenditure is intended to reduce carbon emission and energy use, with a view to mitigating climate-related risks and to meet carbon reduction targets. For further details, refer to the Sustainable Development section on pages 121 to 127. Refer to the table with heading “Audited Financial Information” on page 86 for details of the Group’s capitalised interest rates and the amount of interest capitalised. Valuation processes and techniques underlying management’s estimate of fair value The Group’s investment properties were valued at their fair values at 31st December 2022. 95% by value were valued by Cushman & Wakefield Limited and 2% by value were valued by another independent valuer, in each case on the basis of market value. The independent professionally qualified valuers hold recognised relevant professional qualifications in the jurisdictions in which they valued the Group’s investment properties and have recent experience in the locations and types of investment properties valued. The remaining properties were valued by management. The current use of the investment properties equates to the highest and best use. The valuation of the Group’s completed investment property portfolio is derived by capitalising the rental income derived from existing tenancies with due provision for reversionary income potential and by making reference to recent comparable sales transactions available in the relevant property market. The valuation of the Group’s investment properties under development is derived by making reference to market capitalisation rates and recent comparable sales transactions in the relevant property market (on the assumption that the properties had already been completed at the valuation date). It also takes into account the construction cost already incurred and the estimated cost to be incurred to complete the project plus the developer’s estimated profit and a margin for risk. The fair values of the Group’s investment properties are sensitive to changes in both observable and unobservable inputs. If capitalisation rates increase, the fair values decrease. If market rents increase, the fair values increase. If estimated costs to complete or the developer’s estimated profit and margin for risk increase, the fair values decrease. The opposite is true for decreases in these inputs. There are inter-relationships between observable and unobservable inputs. Expected vacancy rates may have an impact on yields, with higher vacancy rates resulting in higher yields. For investment properties under development, increases in construction costs that enhance the properties’ features may result in an increase in future rental values. An increase in future rental income may be linked with higher costs. The Group reviews the valuations performed by the independent valuers for financial reporting purposes. Discussions of valuation processes and results are held between management and the independent valuers at least once every half year, in line with the Group’s half year reporting dates. SWIRE PROPERTIES ANNUAL REPORT 2022 159

NOTES TO THE FINANCIAL STATEMENTS 16. Investment Properties (continued) Fair value hierarchy The Group’s investment properties are measured at fair value and categorised within the fair value hierarchy as follows: Completed Under Development Chinese Chinese 2022 Hong Kong Mainland U.S.A. Total Hong Kong Mainland Total Total HK$M HK$M HK$M HK$M HK$M HK$M HK$M HK$M Level 2 1,141 193 – 1,334 5,761 – 5,761 7,095 Level 3 204,017 37,714 5,049 246,780 14,052 3,264 17,316 264,096 Total 205,158 37,907 5,049 248,114 19,813 3,264 23,077 271,191 Add: initial leasing costs 177 At 31st December 2022 271,368 Completed Under Development Chinese Chinese 2021 Hong Kong Mainland U.S.A. Total Hong Kong Mainland Total Total HK$M HK$M HK$M HK$M HK$M HK$M HK$M HK$M Level 2 1,773 210 – 1,983 13,127 – 13,127 15,110 Level 3 191,079 38,997 4,644 234,720 17,985 – 17,985 252,705 Total 192,852 39,207 4,644 236,703 31,112 – 31,112 267,815 Add: initial leasing costs 144 At 31st December 2021 267,959 Notes: The levels in the hierarchy represent the following: Level 2 – Investment properties measured at fair value using inputs other than quoted prices but where those inputs are based on observable market data. Level 3 – Investment properties measured at fair value using inputs not based on observable market data. The above investment properties principally comprise commercial and residential properties completed and under development in Hong Kong and the Chinese Mainland. The Group has other investment property projects, principally the Brickell City Centre mall, in Miami which was completed in 2016. Because of the unique nature of the Group’s investment properties, most of them are valued by reference to a level 3 fair value measurement. 160

16. Investment Properties (continued) Fair value hierarchy (continued) The change in level 3 fair value of investment properties during the year is as follows: Completed Under Development Chinese Chinese 2022 Hong Kong Mainland U.S.A. Total Hong Kong Mainland Total Total HK$M HK$M HK$M HK$M HK$M HK$M HK$M HK$M At 1st January 2022 191,079 38,997 4,644 234,720 17,985 – 17,985 252,705 Translation differences – (3,261) (1) (3,262) – (170) (170) (3,432) Additions 525 391 17 933 1,865 3,482 5,347 6,280 Cost written back (367) – – (367) (52) – (52) (419) Transfer between categories 15,629 – – 15,629 (6,170) – (6,170) 9,459 Net fair value (losses)/gains (2,849) 1,587 389 (873) 424 (48) 376 (497) At 31st December 2022 204,017 37,714 5,049 246,780 14,052 3,264 17,316 264,096 Completed Under Development Chinese Chinese 2021 Hong Kong Mainland U.S.A. Total Hong Kong Mainland Total Total HK$M HK$M HK$M HK$M HK$M HK$M HK$M HK$M At 1st January 2021 196,498 34,618 4,799 235,915 14,533 886 15,419 251,334 Translation differences – 1,109 28 1,137 – 13 13 1,150 Additions 329 818 43 1,190 2,555 92 2,647 3,837 Cost written back (6) – – (6) – – – (6) Disposals – (7) (456) (463) – – – (463) Transfer between categories 445 1,131 – 1,576 – (1,131) (1,131) 445 Net transfers from property, plant and equipment 23 – – 23 – – – 23 Net transfers from right-of-use assets 242 – – 242 – – – 242 Net fair value (losses)/gains (6,452) 1,328 230 (4,894) 897 140 1,037 (3,857) At 31st December 2021 191,079 38,997 4,644 234,720 17,985 – 17,985 252,705 SWIRE PROPERTIES ANNUAL REPORT 2022 161

NOTES TO THE FINANCIAL STATEMENTS 16. Investment Properties (continued) Information about level 3 fair value measurements using significant unobservable inputs Fair value Market rent per month1 HK$M Valuation technique HK$ per sq. ft. (lettable) Capitalisation rate At 31st December 2022 Completed Hong Kong 204,017 Income capitalisation Mid 10’s – Low 500’s 2.50% – 4.75% Chinese Mainland 37,714 Income capitalisation Less than 10 – Mid 200’s 5.50% – 6.25% U.S.A. 5,049 Income capitalisation Less than 10 – Low 70’s 5.00% – 5.50% Sub-total 246,780 Under development Hong Kong 14,052 Residual2 Low 60’s – Low 100’s 1.20% – 3.75% Chinese Mainland 3,264 Sales comparison – – Sub-total 17,316 Total (Level 3) 264,096 At 31st December 2021 Completed Hong Kong 191,079 Income capitalisation Less than 10 – Low 500’s 2.50% – 4.88% Chinese Mainland 38,997 Income capitalisation Less than 10 – High 200’s 6.00% – 6.75% U.S.A. 4,644 Income capitalisation Less than 10 – Low 70’s 5.00% – 5.50% Sub-total 234,720 Under development Hong Kong 17,985 Residual2 Low 60’s – High 70’s 3.63% – 3.75% Total (Level 3) 252,705 1 Market rent is determined in accordance with the definition of that term in the HKIS Valuation Standards 2020 of The Hong Kong Institute of Surveyors, which is “the estimated amount for which all interest in real property should be leased on the valuation date between a willing lessor and a willing lessee on appropriate lease terms in an arm’s length transaction, after proper marketing and where the parties had each acted knowledgeably, prudently, and without compulsion”. It is in effect the rental income (exclusive of usual outgoings) which a property would be expected to earn if it were vacant and available to let. It is not necessarily the same as the rent which a tenant is actually committed to pay. 2 In using the residual method to make fair value measurements of investment properties, two additional unobservable inputs have been used. These are the estimated costs to complete the development and the developer’s estimated profit and margin for risk. 162

17. Intangible Assets Accounting Policy Computer software Computer software licences acquired are capitalised on the basis of the costs incurred to acquire and bring into use the specific software. These costs are amortised over their estimated useful lives (three to five years). Costs associated with maintaining computer software programmes are recognised as expenses as incurred. Costs that are directly associated with the development of identifiable and unique software products controlled by the Group, and that will probably generate economic benefits exceeding costs beyond one year, are recognised as intangible assets. Direct costs include the software development employee costs and an appropriate portion of relevant overheads. Computer software costs recognised as assets are amortised over their estimated useful lives (three to five years). Computer Software Others Total HK$M HK$M HK$M Cost: At 1st January 2022 263 205 468 Additions 58 – 58 At 31st December 2022 321 205 526 Accumulated amortisation: At 1st January 2022 163 102 265 Amortisation for the year (note 7) 32 21 53 At 31st December 2022 195 123 318 Net book value: At 31st December 2022 126 82 208 Computer Software Others Total HK$M HK$M HK$M Cost: At 1st January 2021 211 205 416 Additions 52 – 52 At 31st December 2021 263 205 468 Accumulated amortisation: At 1st January 2021 138 80 218 Amortisation for the year (note 7) 25 22 47 At 31st December 2021 163 102 265 Net book value: At 31st December 2021 100 103 203 Amortisation of HK$53 million (2021: HK$47 million) is included in cost of sales and administrative expenses in the consolidated statement of profit or loss. SWIRE PROPERTIES ANNUAL REPORT 2022 163

NOTES TO THE FINANCIAL STATEMENTS 18. Right-of-use Assets Accounting Policy The Group (acting as lessee) leases land, offices, warehouses and equipment. Except for certain long-term leasehold land in Hong Kong, rental contracts are typically made for fixed periods of 1 to 50 years but may have extension and early termination options. Lease terms are negotiated on an individual basis and contain a wide range of different terms and conditions. Leased assets may not be used as security for borrowing purposes. Leases are recognised by lessees as right-of-use assets and corresponding liabilities at the date at which the leased assets are available for use by the Group. Each lease payment is allocated between the liability and finance cost. The finance cost is charged to the consolidated statement of profit or loss over the lease period so as to produce a constant periodic rate of interest on the remaining balance of the liability for each financial period. Assets and liabilities arising from leases are initially measured on a present value basis. Lease liabilities include the net present value of the following lease payments: – fixed payments (including in-substance fixed payments), less any lease incentives receivable; – variable lease payments that are based on an index or a rate, initially measured using the index or rate at the commencement date; – amounts expected to be payable by the lessee under residual value guarantees; – the exercise price of a purchase option if the lessee is reasonably certain to exercise that option; and – payment of penalties for terminating the lease, if the lease term used in the computation assumes the lessee exercises an option to terminate. The lease payments are discounted using the interest rate implicit in the lease. If that rate cannot be determined, the lessee’s incremental borrowing rate is used, being the rate that the lessee would have to pay to borrow the funds necessary to obtain an asset of similar value in a similar economic environment with similar terms and conditions. Right-of-use assets are measured at cost comprising the following: – the amount of the initial measurement of lease liability; – any lease payments made at or before the commencement date less any lease incentives received; – any initial direct costs; and – restoration costs. The right-of-use asset is depreciated over the shorter of the asset’s useful life and the lease term on a straight-line basis. However, if the ownership of the underlying asset is expected to be transferred to the Group by the end of the lease term and if the cost of the right-of-use asset has already included the exercise price of a purchase option, depreciation is calculated on a straight-line basis to write off the cost over the anticipated useful life of the underlying asset to its estimated residual value. Payments by lessees associated with short-term leases and leases of low-value assets are recognised on a straight-line basis as expenses in the consolidated statement of profit or loss. Short-term leases are leases with a lease term of twelve months or less. Low-value assets comprise information technology equipment and small items of office furniture. 164

18. Right-of-use Assets (continued) The recognised right-of-use assets relate to the following types of assets: 2022 2021 HK$M HK$M Leasehold land held for own use 2,340 2,367 Property 142 75 2,482 2,442 The Group is the registered owner or occupant of its leasehold land. Upfront payments were made to acquire these interests in land and there are no ongoing payments to be made under the terms of the land leases (so that no lease liabilities are recognised) except, government rents and rates and other payments to the relevant government authorities, which may vary from time to time. Details relating to these interests in land are as follows: Leasehold land held for own use 2022 2021 HK$M HK$M Held in Hong Kong On medium-term leases (10-50 years) 345 360 On long-term leases (over 50 years) 1,995 2,007 2,340 2,367 Lease arrangements for other types of assets are negotiated on an individual asset basis and contain a wide range of different terms and conditions including lease payments and lease terms. Properties occupied by the Group are transferred to investment properties following the end of occupation by the Group. The valuation increase from carrying amount to fair value in respect of such transfers during the year ended 31st December 2022 was less than HK$1 million (2021: HK$94 million). Additions to right-of-use assets during the year ended 31st December 2022 were HK$107 million (2021: HK$5 million). During the year ended 31st December 2022, cash outflows for leases were included in the consolidated statement of cash flows as (a) interest paid of HK$19 million (2021: HK$18 million) under “operating activities”, (b) payment for short-term and low-value assets leases of HK$32 million (2021: HK$32 million) under “operating activities” and (c) principal elements of lease payments of HK$66 million (2021: HK$72 million) under “financing activities”. SWIRE PROPERTIES ANNUAL REPORT 2022 165

NOTES TO THE FINANCIAL STATEMENTS 19. Properties Held for Development Accounting Policy Properties held for development comprise freehold land at cost and related costs of preliminary works, less provisions for possible losses. Properties held for development are not expected to be sold or developed within the Group’s normal operating cycle and are classified as non-current assets. 2022 2021 HK$M HK$M Properties held for development Freehold land 987 986 Development cost 221 221 1,208 1,207 20. Joint Venture Companies Accounting Policy Joint venture companies are those companies interests in which are held for the long term; and over which the Group is in a position to exercise joint control with other venturers in accordance with contractual arrangements, and where the Group has rights to the net assets of those companies. The use of the equity method by the Group to account for the investment in joint venture companies is disclosed in the “Basis of Consolidation” of the Principal Accounting Policies on pages 198 to 200. 2022 2021 HK$M HK$M Restated Share of net assets, unlisted 24,286 21,935 Goodwill 303 – Joint venture companies 24,589 21,935 Loans due from joint venture companies less provisions – Interest-free 13,360 13,426 – Interest-bearing at 1.7% to 6.5% (2021: 0.86% to 6.5%) 1,913 2,193 15,273 15,619 The loans due from joint venture companies are unsecured and have no fixed terms of repayment. These loans are considered to have low credit risk. The financial positions and performances of these companies are regularly monitored and reviewed by the management of the Group. On 15th December 2022, the Group entered into three Master Agreements with Sino-Ocean Group Holding Limited and its subsidiaries (“Sino-Ocean Group”) to purchase in aggregate 50% interests in existing joint venture companies in Sino-Ocean Taikoo Li Chengdu for a total cash consideration of RMB5,550 million. In accordance with the Master Agreements and subject to certain conditions being satisfied: – the Group acquires 15% interests in these joint venture companies under the first Master Agreement; and – the Group acquires 35% interests in these joint venture companies under the second and third Master Agreements. The first Master Agreement was completed in December 2022. The second and third Master Agreements were completed in February 2023. RMB1,000 million of the total cash consideration was settled in 2022. The remaining RMB4,550 million was settled in February 2023. At 31st December 2022, these joint venture companies were still under the joint control of the Group. 166

20. Joint Venture Companies (continued) The Group’s share of assets and liabilities and results of joint venture companies is summarised below: 2022 2021 HK$M HK$M Restated Non-current assets 51,174 51,676 Current assets 7,199 3,915 Current liabilities (5,587) (2,649) Non-current liabilities (28,500) (31,007) Net assets 24,286 21,935 Revenue 3,225 2,974 Change in fair value of investment properties 877 1,197 Expenses (2,133) (1,766) Profit before taxation 1,969 2,405 Taxation (526) (537) Profit for the year 1,443 1,868 Other comprehensive income (1,744) 561 Total comprehensive income for the year (301) 2,429 Capital commitments and contingencies in respect of joint venture companies are disclosed in notes 39 and 40. The principal joint venture companies of Swire Properties Limited are shown on pages 201 to 203. There are no joint venture companies that are considered individually material to the Group. 21. Associated Companies Accounting Policy Associated companies are those companies over which the Group has significant influence, but not control or joint control, over their management including participation in financial and operating policy decisions, generally accompanying a shareholding representing between 20% and 50% of the voting rights. The use of the equity method by the Group to account for the investment in associated companies is disclosed in the “Basis of Consolidation” of the Principal Accounting Policies on pages 198 to 200. 2022 2021 HK$M HK$M Share of net assets, unlisted 473 461 Loans due from associated companies less provisions – Interest-free 12 – – Interest-bearing at 6.41% (2021: nil) 40 – 52 – The loans due from associated companies are unsecured and no fixed term of repayment, except for an interest-bearing loan due from an associated company of HK$40 million which is repayable in 2027. These loans are considered to have low credit risk. The financial positions and performances of these companies are regularly monitored and reviewed by the management of the Group. SWIRE PROPERTIES ANNUAL REPORT 2022 167

NOTES TO THE FINANCIAL STATEMENTS 21. Associated Companies (continued) The Group’s share of assets and liabilities and results of associated companies is summarised below: 2022 2021 HK$M HK$M Non-current assets 651 612 Current assets 383 339 Current liabilities (145) (158) Non-current liabilities (416) (332) Net assets 473 461 Revenue 276 188 Profit and total comprehensive income for the year 12 (82) The principal associated companies of Swire Properties Limited are shown on pages 201 to 203. There are no associated companies that are considered individually material to the Group. 22. Financial Instruments by Category Accounting Policy Financial Assets (a) Classification The Group classifies its financial assets in the following measurement categories: – those to be measured subsequently at fair value (either through the consolidated statement of other comprehensive income (“OCI”) or through the consolidated statement of profit or loss), and – those to be measured at amortised cost. The classification depends on the Group’s business model for managing the financial assets and the contractual terms of the cash flows. For assets measured at fair value, gains and losses are either recorded in the consolidated statement of profit or loss or the consolidated statement of OCI. For investments in equity instruments that are not held for trading, this will depend on whether the Group has made an irrevocable election at the time of initial recognition to account for the equity investment at FVOCI. The Group reclassifies debt investments when and only when its business model for managing those assets changes. (b) Recognition and derecognition Purchases and sales of financial assets are recognised on their trade date, the date on which the Group commits to purchase or sell the asset. Financial assets are derecognised when the rights to receive cash flows from the financial assets have expired or have been transferred and the Group has transferred substantially all the risks and rewards of ownership. (c) Measurement At initial recognition, except for trade debtors, the Group measures a financial asset at its fair value plus, in the case of a financial asset not at FVPL, transaction costs that are directly attributable to the acquisition of the financial asset. Transaction costs in respect of financial assets at FVPL are expensed in the consolidated statement of profit or loss. Financial assets with embedded derivatives are considered in their entirety when determining whether their cash flows are solely payments of principal and interest. – Debt instruments: Subsequent measurement of debt instruments depends on the Group’s business model for managing the asset and the cash flow characteristics of the asset. There are three measurement categories into which the Group classifies its debt instruments: 168

22. Financial Instruments by Category (continued) Accounting Policy (continued) Financial Assets (continued) (c) Measurement (continued) (i) Amortised cost: Assets that are held for collection of contractual cash flows, where those cash flows represent solely payments of principal and interest, are measured at amortised cost. Interest income from these financial assets is included in finance income using the effective interest rate method. Any gain or loss arising on derecognition is recognised directly in the consolidated statement of profit or loss and presented in other net gains/(losses) together with foreign exchange gains and losses. (ii) FVOCI: Assets that are held for collection of contractual cash flows and for selling the financial assets, where the assets’ cash flows represent solely payments of principal and interest, are measured at FVOCI. Movements in the carrying amount are taken through OCI, except for the recognition of impairment gains or losses, interest income and foreign exchange gains and losses, which are recognised in the consolidated statement of profit or loss. When the financial asset is derecognised, the cumulative gain or loss previously recognised in OCI is reclassified from equity to the consolidated statement of profit or loss and recognised in other net gains/(losses). Interest income from these financial assets is included in finance income using the effective interest method. Foreign exchange gains and losses are presented in other net gains/(losses). (iii) FVPL: Assets that do not meet the criteria for amortised cost or FVOCI are measured at FVPL. A gain or loss on a debt investment that is subsequently measured at FVPL is recognised in the consolidated statement of profit or loss and presented net within other net gains/(losses) in the period in which it arises. – Equity instruments: The Group subsequently measures all equity investments at fair value. Dividends from such investments are recognised in the consolidated statement of profit or loss as other net gains/(losses) when the Group’s right to receive payments is established. Where the Group’s management has elected to present fair value gains and losses on equity investments in OCI, there is no subsequent reclassification of fair value gains and losses to the consolidated statement of profit or loss following the derecognition of the investment. Changes in the fair value of equity investments at FVPL are recognised in other net gains/(losses) in the consolidated statement of profit or loss as applicable. Impairment losses (and reversal of impairment losses) on equity investments measured at FVOCI are not reported separately from other changes in fair value. (d) Impairment The Group assesses on a forward-looking basis the expected credit losses associated with its debt instruments carried at amortised cost and FVOCI. The impairment methodology applied depends on whether there has been a significant increase in credit risk. The Group applies the simplified approach permitted by HKFRS 9 to measure expected credit losses which uses a lifetime expected loss allowance for all trade receivables. The measurement of expected credit losses of operating lease receivable includes consideration of expectations of forgiveness of lease income recognised as part of that receivable. (e) Significant increases in credit risk In assessing whether the credit risk of a financial asset has increased significantly since initial recognition, the Group considers that a default event occurs when the borrower is unlikely to pay its credit obligations to the Group in full, without recourse to actions such as realising security. The Group considers information that is reasonable and supportable, including historical experience and forward-looking information that is available. (f) Write-off policy The gross carrying amount of a financial asset is written off to the extent that there is no realistic prospect of recovery. Financial liabilities Non-derivative financial liabilities with fixed or determinable payments and fixed maturities are measured at amortised cost. They are included in non-current liabilities, except for maturities less than twelve months after the period-end date where these are classified as current liabilities. Put options in respect of non-controlling interests in subsidiary companies included in trade and other payables are measured at fair value through the consolidated statement of profit or loss. SWIRE PROPERTIES ANNUAL REPORT 2022 169

NOTES TO THE FINANCIAL STATEMENTS 22. Financial Instruments by Category (continued) The accounting policies applied to financial instruments are shown below by line item: At fair value Derivatives used Amortised Total carrying Fair through profit or loss for hedging cost amount value Note HK$M HK$M HK$M HK$M HK$M Assets as per consolidated statement of financial position At 31st December 2022 Loans due from joint venture companies 20 – – 15,273 15,273 15,273 Loans due from associated companies 21 – – 52 52 52 Trade and other receivables excluding prepayments 24 – – 2,238 2,238 2,238 Cash and cash equivalents 26 – – 4,502 4,502 4,502 Derivative financial assets 30 – 96 – 96 96 Financial assets at fair value through profit or loss – Unlisted equity investments 460 – – 460 460 Other financial assets at amortised cost 32 – – 520 520 520 Total 460 96 22,585 23,141 23,141 At 31st December 2021 (Restated) Loans due from joint venture companies 20 – – 15,619 15,619 15,619 Amounts due from immediate holding company 25 – – 1 1 1 Trade and other receivables excluding prepayments 24 – – 2,149 2,149 2,149 Cash and cash equivalents 26 – – 14,833 14,833 14,833 Derivative financial assets 30 – 152 – 152 152 Financial assets at fair value through profit or loss – Unlisted equity investments 439 – – 439 439 Other financial assets at amortised cost 32 – – 522 522 522 Total 439 152 33,124 33,715 33,715 Liabilities as per consolidated statement of financial position At 31st December 2022 Trade and other payables excluding non-financial liabilities 27 590 – 9,414 10,004 10,004 Long-term loans and bonds 29 – – 22,835 22,835 21,910 Lease liabilities 28 – – 614 614 614 Total 590 – 32,863 33,453 32,528 At 31st December 2021 Trade and other payables excluding non-financial liabilities 27 551 – 8,925 9,476 9,476 Long-term loans and bonds 29 – – 24,601 24,601 25,461 Lease liabilities 28 – – 566 566 566 Derivative financial liabilities 30 – 7 – 7 7 Total 551 7 34,092 34,650 35,510 170

22. Financial Instruments by Category (continued) The fair values of financial instruments traded in active markets are based on quoted market prices at the year-end date. The quoted market prices used for financial assets held by the Group are the current bid prices. The fair values of financial instruments that are not traded in active markets are determined by using valuation techniques such as estimated discounted cash flows, which use assumptions that are based on market conditions existing at each year-end date. The book values of trade and other receivables and trade and other payables approximate their fair values. The fair value of current borrowings equals their carrying value, as the impact of discounting is not significant. The fair value of non- current borrowings is not equal to their carrying value but is based on cash flows discounted using assumptions sourced from the relevant financial institutions or quotes from market makers or alternative market participants supported by observable inputs, such as interest rates. Non-current borrowings would be categorised within level 2 of the fair value hierarchy if they were accounted for at fair value. Financial instruments that are measured at fair value are included in the following fair value hierarchy: Total carrying Level 2 Level 3 amount HK$M HK$M HK$M Assets as per consolidated statement of financial position At 31st December 2022 Derivatives used for hedging (note 30) 96 – 96 Financial assets at fair value through profit or loss – Unlisted equity investments – 460 460 96 460 556 At 31st December 2021 Derivatives used for hedging (note 30) 152 – 152 Financial assets at fair value through profit or loss – Unlisted equity investments – 439 439 152 439 591 Liabilities as per consolidated statement of financial position At 31st December 2022 Put option in respect of a non-controlling interest (note 27) – 590 590 At 31st December 2021 Derivatives used for hedging (note 30) 7 – 7 Put option in respect of a non-controlling interest (note 27) – 551 551 7 551 558 Notes: The levels in the hierarchy represent the following: Level 2 – Financial instruments measured at fair value using inputs other than quoted prices but where those inputs are based on observable market data. Level 3 – Financial instruments measured at fair value using inputs not based on observable market data. SWIRE PROPERTIES ANNUAL REPORT 2022 171

NOTES TO THE FINANCIAL STATEMENTS 22. Financial Instruments by Category (continued) The fair value of derivatives used for hedging in level 2 has been based on quotes from market makers or alternative market participants supported by observable inputs. The most significant observable inputs are market interest rates, exchange rates and yields. There were no transfers of financial instruments between level 2 and level 3 fair value hierarchy classifications and there were no transfers into or out of level 3 fair value hierarchy classifications. The Group’s policy is to recognise any transfer into and out of fair value hierarchy levels at the date of the event or change in circumstances that caused the transfer. There has been no change in the valuation techniques for level 2 and level 3 fair value hierarchy classifications. The Group’s finance department performs the valuations of financial instruments required for reporting purposes, including level 3 fair values. The valuations are reviewed and approved by the Finance Director. The following table presents the changes in level 3 financial instruments for the year ended 31st December 2022: Financial assets Put option in at fair value respect of a through non-controlling profit or loss interest HK$M HK$M At 1st January 2022 439 551 Additions 21 – Distribution during the year – (27) Change in fair value recognised as net finance charges* – 66 At 31st December 2022 460 590 * Included unrealised losses recognised on balances held at 31st December 2022 – 66 At 1st January 2021 985 513 Translation differences – 3 Additions 436 – Disposals (970) – Distribution during the year – (29) Change in fair value recognised as net finance charges* – 64 Change in fair value recognised as other net gains* (12) – At 31st December 2021 439 551 * Included unrealised losses recognised on balances held at 31st December 2021 12 64 The fair value of unlisted investments classified within level 3 is determined using discounted cash flow valuation techniques. The significant unobservable inputs used are expected future growth rates and discount rates. Changing these unobservable inputs based on reasonable alternative assumptions would not significantly change the valuation of the investments. The fair value estimate of the put option over a non-controlling interest in the U.S.A. classified within level 3 is determined using a discounted cash flow valuation technique and contains a number of unobservable inputs, including the expected fair value of the associated investment property at the expected time of exercise, the expected time of exercise itself and the discount rate used. The expected time of exercise is in 2023 and the discount rate used is 6.3% (2021: 6.3%). The investment property’s fair value at the expected time of exercise is itself subject to a number of unobservable inputs which are similar to the inputs for the Group’s other completed investment properties, including the expected fair market rent and the expected capitalisation rate. If the investment property’s expected fair value at the time of exercise is higher, the fair value of the put option would also be higher at 31st December 2022. If the expected time of exercise is later or if the discount rate is higher, the fair value of the put option would be lower. The opposite is true for an earlier time of exercise or a lower discount rate. 172

23. Properties for Sale Accounting Policy Properties for sale comprise freehold and leasehold land at cost, construction costs and interest costs capitalised, less provisions for possible losses. Properties under development are active construction projects which are expected to be sold within the Group’s normal operating cycle and are classified as current assets. Properties for sale are available for immediate sale and are classified as current assets. 2022 2021 HK$M HK$M Properties for sale Properties under development – development costs 619 494 – leasehold land 7,389 5,759 Completed properties – development costs 138 8 – freehold land – 149 – leasehold land 118 1 8,264 6,411 Refer to the table with heading “Audited Financial Information” on page 86 for details of the Group’s capitalised interest rates and the amount of interest capitalised. SWIRE PROPERTIES ANNUAL REPORT 2022 173

NOTES TO THE FINANCIAL STATEMENTS 24. Trade and Other Receivables Accounting Policy Trade receivables are recognised initially at the amount of consideration that is unconditional unless they contain significant financing components. Other receivables are recognised initially at fair value. Trade and other receivables are subsequently measured at amortised cost using the effective interest method, less provision for loss allowance. Trade and other receivables in the consolidated statement of financial position are stated net of such provisions. 2022 2021 HK$M HK$M Restated Trade debtors 385 396 Prepayments and accrued income 85 81 Amounts due from intermediate holding company 5 – Other financial assets at amortised cost (note 32) 520 – Other receivables 1,839 1,743 2,834 2,220 The analysis of the age of trade debtors at the year end (based on their invoice dates) is as follows: 2022 2021 HK$M HK$M Up to 3 months 354 338 Between 3 and 6 months 15 24 Over 6 months 16 34 385 396 Other receivables include rent free and other lease incentives to tenants of HK$1,198 million (2021 (Restated): HK$1,275 million), which are amortised over the relevant lease terms. There is no concentration of credit risk with respect to trade and other receivables, as the Group has a large number of customers. The Group does not grant any credit terms to its customers, except to corporate customers in the hotel division where commercial trade credit terms are given. The Group also holds non-interest-bearing rental deposits as security against trade debtors. At 31st December 2022, trade debtors of HK$145 million (2021: HK$124 million) were past due. The majority of the amount past due is under three months. These relate to a number of independent customers for whom there is no recent history of default. The other classes within trade and other receivables do not contain impaired assets. The maximum exposure to credit risk at 31st December 2022 and 31st December 2021 is the carrying value of trade debtors and other receivables disclosed above. The carrying value of rental deposits from tenants held as security against trade debtors at 31st December 2022 was HK$2,715 million (2021: HK$2,782 million). 174

25. Amounts Due from Immediate Holding Company – Swire Pacific Limited The amounts due from immediate holding company is unsecured, interest-free and repayable within one year. 26. Cash and Cash Equivalents Accounting Policy In the consolidated statement of cash flows, cash and cash equivalents comprise cash in hand, amounts repayable on demand from banks and financial institutions and short-term highly liquid investments which were within three months of maturity when acquired, less bank overdrafts. In the consolidated statement of financial position, cash and cash equivalents exclude bank overdrafts which are shown within borrowings in current liabilities. 2022 2021 HK$M HK$M Short-term deposits maturing within three months 307 8,060 Bank balances 4,195 6,773 4,502 14,833 The effective interest rates on short-term deposits of the Group ranged from 3.5% to 5.2% (2021: 0.1% to 2.6%) per annum; these deposits have maturities from 33 to 94 days (2021: 22 to 94 days). The maximum exposure to credit risk in respect of bank balances and short-term deposits at 31st December 2022 and 31st December 2021 is the carrying value of the bank balances and short-term deposits disclosed above. 27. Trade and Other Payables Accounting Policy Trade and other payables (except put options over non-controlling interests in subsidiary companies) are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method. Put options in respect of non- controlling interests in subsidiary companies are measured at the fair value of the expected redemption amounts, and are designated at fair value through profit or loss. SWIRE PROPERTIES ANNUAL REPORT 2022 175

NOTES TO THE FINANCIAL STATEMENTS 27. Trade and Other Payables (continued) 2022 2021 HK$M HK$M Trade creditors 812 721 Rental deposits from tenants 2,715 2,782 Deposits received on sale of investment properties 1 10 Put option in respect of a non-controlling interest 590 551 Other payables Accrued capital expenditure 1,283 1,363 Amounts due to intermediate holding company 83 100 Amounts due to a joint venture company 113 – Amounts due to an associated company – 5 Interest-bearing advances from joint venture companies at 4.65% (2021: 1.42% to 4.65%) 256 479 Advances from a non-controlling interest 1,173 1,130 Others 2,982 2,348 5,890 5,425 10,008 9,489 Amounts due after one year included under non-current liabilities – (150) 10,008 9,339 Amounts due to intermediate holding company, an associated company, joint venture companies and a non-controlling interest are unsecured and have no fixed term of repayment, except for interest-bearing advances from a joint venture company of HK$150 million at 31st December 2021 which were repayable after 2023 and were early settled during the year. Apart from the interest-bearing advances from the joint venture companies, the balances are interest-free. The analysis of the age of trade creditors at the year end is as follows: 2022 2021 HK$M HK$M Up to 3 months 812 721 176

28. Lease Liabilities 2022 2021 HK$M HK$M Maturity profile at the year end is as follows: Within 1 year 79 49 Between 1 and 2 years 73 53 Between 2 and 5 years 192 126 Over 5 years 270 338 614 566 Amount due within one year included under current liabilities (79) (49) 535 517 At 31st December 2022, the weighted average incremental borrowing rate applied in measuring the lease liabilities was 3.3% (2021: 3.3%). For the accounting policy in respect of lease liabilities, please refer to right-of-use assets (note 18). 29. Borrowings Accounting Policy Borrowings are recognised initially at fair value and subsequently measured at amortised cost. Transaction costs incurred are included in respect of those not held at fair value through profit or loss. Transaction costs are incremental costs that are directly attributable to the initiation of the borrowings, including fees and commissions paid to agents, advisers, brokers and dealers, levies by regulatory agencies and securities exchanges, and transfer taxes and duties. Borrowings are subsequently stated at amortised cost, with any difference between the proceeds (net of transaction costs) and the redemption value recognised in the consolidated statement of profit or loss over the period of the borrowings using the effective interest method. Borrowings are classified as current liabilities unless the Group has an unconditional right to defer settlement of the liability for at least twelve months after the period-end date. For disclosure purposes, the fair value of borrowings stated at amortised cost is estimated by discounting the future contractual cash flows at the current market interest rate that is available to the Group for similar financial instruments. SWIRE PROPERTIES ANNUAL REPORT 2022 177

NOTES TO THE FINANCIAL STATEMENTS 29. Borrowings (continued) Refer to the tables with the headings “Audited Financial Information” on pages 82 to 85 for details of the Group’s borrowings. 2022 2021 HK$M HK$M Long-term bank loans – unsecured Repayable within 1 year 500 5,102 Repayable between 1 and 2 years 776 – Repayable between 2 and 5 years 6,535 588 7,811 5,690 Other borrowings – unsecured Repayable within 1 year 200 3,898 Repayable between 1 and 2 years 1,099 199 Repayable between 2 and 5 years 8,660 7,619 Repayable after 5 years 5,065 7,195 15,024 18,911 Amount due within one year included under current liabilities (700) (9,000) 22,135 15,601 (a) The effective interest rates per annum (before interest rate and cross-currency swaps) at 31st December were as follows: 2022 2021 HKD USD HKD USD % % % % Long-term loans and bonds 2.3-5.7 3.5-5.2 0.8-3.6 0.8-4.4 There were no uncommitted bank loans at 31st December 2022 and 2021. Bank loans and other borrowings are repayable on various dates up to 2030 (2021: up to 2030). (b) The carrying amounts of these long-term bank loans and other borrowings (before cross-currency swaps) are denominated in the following currencies: 2022 2021 HK$M HK$M Hong Kong dollars 11,958 9,071 United States dollars 10,877 15,530 22,835 24,601 178

30. Derivative Financial Instruments Accounting Policy Derivatives are initially recognised at fair value on the dates derivative contracts are entered into and are subsequently remeasured to their fair value. The method of recognising the resulting gain or loss depends on whether the derivative is designated as a hedging instrument and, if so, the nature of the item being hedged. The Group documents at the inception of the transactions the economic relationship between hedging instruments and hedged items, as well as its risk management objectives and strategy for undertaking hedge transactions. The Group also documents its assessment, both at hedge inception and on an ongoing basis, whether the derivatives that are used in hedging transactions are highly effective in offsetting cash flows of hedged items. All of the Group’s derivatives relate to cash flow hedges. The effective portion of changes in the fair value of derivatives that are designated and qualify as cash flow hedges is recognised in the cash flow hedge reserve within equity. The gain or loss relating to the ineffective portion is recognised immediately in the consolidated statement of profit or loss. When cross-currency swap contracts are used to hedge future cash flows, the Group designates only the change in fair value of the swap contract after exclusion of the foreign currency basis spread component as the hedging instrument. Gains or losses relating to the effective portion of the swap contract after exclusion of the foreign currency basis spread component are recognised in the cash flow hedge reserve within equity. The change in fair value of the foreign currency basis spread of the swap contract, to the extent it relates to the hedged item, is recognised separately as a cost of hedging on a systematic and rational basis over the period of the hedging relationship within OCI in equity. Hedge ineffectiveness is recognised in the consolidated statement of profit or loss within finance costs. Amounts accumulated in equity are reclassified in the periods when the hedged item affects the consolidated statement of profit or loss. The gains or losses relating to the effective portion of (a) the interest rate swaps hedging variable rate borrowings and (b) cross-currency swap contracts hedging borrowings in foreign currency are recognised in the consolidated statement of profit or loss within finance costs at the same time as the interest expense on the hedged borrowings. If the hedge ratio for risk management purpose is no longer optimal but the risk management objective remains unchanged and the hedge continues to qualify for hedge accounting, the hedge relationship will be rebalanced by adjusting either the volume of the hedging instrument or the volume of the hedged item so that the hedge ratio aligns with the ratio used for risk management purposes. Any hedge ineffectiveness is calculated and accounted for in the consolidated statement of profit or loss at the time of the hedge relationship rebalancing. When a hedging instrument expires or is sold, or when a hedge no longer meets the criteria for hedge accounting, any cumulative gain or loss existing in equity at that time remains in equity and is recognised when the forecast transaction is ultimately recognised in the consolidated statement of profit or loss. When a forecast transaction is no longer expected to occur, the cumulative gain or loss that was reported in equity is immediately transferred to the consolidated statement of profit or loss. 2022 2021 Assets Liabilities Assets Liabilities HK$M HK$M HK$M HK$M Interest rate and cross-currency swaps – cash flow hedges – due within one year – – 19 7 – due after one year 96 – 133 – The interest rate swaps hedge long-term interest rate exposures. The cross-currency swaps hedge the foreign currency risk relating to US dollar note issues. Gains and losses recognised in the consolidated statement of other comprehensive income on interest rate and cross-currency swaps at 31st December 2022 are expected to affect the consolidated statement of profit or loss in the years to redemption of the notes and expiry of loans (up to and including 2028). SWIRE PROPERTIES ANNUAL REPORT 2022 179

NOTES TO THE FINANCIAL STATEMENTS 30. Derivative Financial Instruments (continued) The notional principal amounts of the outstanding derivative financial instruments are as follows: 2022 2021 HK$M HK$M Cross-currency swaps 7,797 11,695 Interest rate swaps – 1,559 In most of the cases, the hedging instruments have a one-to-one hedge ratio with the hedged items. For the years ended 31st December 2022 and 31st December 2021, all cash flow hedges qualifying for hedge accounting were highly effective. 31. Deferred Taxation Accounting Policy Deferred taxation is provided in full, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements. However, if the deferred tax arises from initial recognition of an asset or liability in a transaction other than a business combination that, at the time of the recognition, has no impact on taxable or accounting profit or loss, it is not recognised. Tax rates enacted or substantively enacted by the period-end date are used to determine deferred taxation. Deferred tax assets are recognised to the extent that it is probable that future taxable profits will be available against which the temporary differences can be utilised. Deferred taxation is provided on temporary differences arising on investments in subsidiary, joint venture and associated companies, except where the timing of the reversal of the temporary difference is controlled by the Group and it is probable that the temporary difference will not reverse in the foreseeable future. Deferred tax relating to investment properties in Hong Kong and the U.S.A. is calculated having regard to the presumption that the value of these properties is capable of being recovered entirely through sale. This presumption is rebutted in relation to investment properties in the Chinese Mainland, because the business model applicable to them is to consume substantially all the economic benefits embodied in them over time rather than through sale. Accordingly, deferred tax relating to investment properties in the Chinese Mainland is determined on the basis of recovery through use. Deferred tax assets and liabilities are netted off when the taxes relate to the same taxation authority and where offsetting is legally enforceable. The following amounts, determined after appropriate offsetting, are shown separately in the consolidated statement of financial position: 2022 2021 HK$M HK$M Restated Deferred tax assets 64 78 Deferred tax liabilities (11,248) (10,746) At 31st December (11,184) (10,668) Substantially all deferred tax balances are to be recovered or settled after more than 12 months. 180

31. Deferred Taxation (continued) The movement on the net deferred tax liabilities account is as follows: 2022 2021 HK$M HK$M Restated At 1st January – as originally stated 10,769 10,021 – impact of adjustments in note 1(c) (101) (103) – as restated 10,668 9,918 Translation differences (591) 201 Charged to profit or loss (note 11) 1,079 553 Charged/(Credited) to other comprehensive income 35 (4) Disposal of subsidiary companies (7) – At 31st December 11,184 10,668 The movement in deferred tax assets and liabilities (prior to offsetting balances within the same taxation jurisdiction) during the year is as follows: Deferred tax liabilities Valuation of Accelerated tax investment depreciation properties Others Total 2022 2021 2022 2021 2022 2021 2022 2021 HK$M HK$M HK$M HK$M HK$M HK$M HK$M HK$M At 1st January 4,384 4,228 6,108 5,503 804 749 11,296 10,480 Translation differences (85) 30 (489) 168 2 4 (572) 202 Charged to profit or loss 589 126 472 437 10 51 1,071 614 Credited to other comprehensive income – – – – (5) – (5) – Disposal of subsidiary companies (7) – – – – – (7) – At 31st December 4,881 4,384 6,091 6,108 811 804 11,783 11,296 Deferred tax assets Tax losses Others Total 2022 2021 2022 2021 2022 2021 HK$M HK$M HK$M HK$M HK$M HK$M Restated Restated At 1st January – as originally stated 249 210 278 249 527 459 – impact of adjustments in note 1(c) – – 101 103 101 103 – as restated 249 210 379 352 628 562 Translation differences 5 1 14 – 19 1 Credited/(Charged) to profit or loss 69 38 (77) 23 (8) 61 (Charged)/Credited to other comprehensive income – – (40) 4 (40) 4 At 31st December 323 249 276 379 599 628 SWIRE PROPERTIES ANNUAL REPORT 2022 181

NOTES TO THE FINANCIAL STATEMENTS 31. Deferred Taxation (continued) Deferred tax assets (continued) Deferred tax assets are recognised in respect of tax losses carried forward to the extent that realisation of the related tax benefits through future taxable profits is probable. The Group has unrecognised tax losses of HK$2,458 million (2021: HK$2,367 million) to carry forward against future taxable income. These amounts are analysed as follows: Unrecognised tax losses 2022 2021 HK$M HK$M No expiry date 1,253 1,161 Expiring within 1 year 89 40 Expiring between 1 and 5 years 395 424 Expiring between 5 and 10 years – – Expiring between 10 and 20 years 721 742 2,458 2,367 32. Other Financial Assets at Amortised Cost 2022 2021 HK$M HK$M Mortgage receivables – 17 Other receivable 520 505 520 522 Amount due within one year included under current assets (note 24) (520) – – 522 Mortgage receivables consist of mortgage financing offered to certain buyers of trading properties in the U.S.A. Mortgages are offered at up to an 80% loan-to-value ratio and at a fixed interest rate of 5.5%. Loan repayments for the first four years are at a rate that would repay the loan over 30 years, but there is a balloon payment in the fifth year upon maturity. The non-current other receivables are due and payable within two to three years from the end of the reporting period. The other receivable represents a deferred payment for the sale of the Group’s interest in the Cityplaza One office tower in Hong Kong in 2020. In accordance with the sale and purchase agreement, the deferred payment is to be received on the third anniversary of the completion of the disposal. The deferred payment is recognised at amortised cost using an effective interest rate of 3% per annum. The Group holds the mortgage and other receivables to collect contractual cash flows and its contractual terms give rise to cash flows on specified dates which are solely payments of principal and interest on the principal amounts outstanding. The Group applies the expected credit loss model to measure the impairment of other financial assets at amortised cost. 182

33. Assets Classified as Held for Sale Accounting Policy Non-current assets (or disposal groups) are classified as held for sale if their carrying amount will be recovered principally through a sale transaction rather than through continuing use and a sale is considered highly probable. They are measured at the lower of their carrying amount and fair value less costs to disposal, except for assets such as deferred tax assets, financial assets and investment property that are carried at fair value. Assets classified as held for sale represent the Group’s 100% interest in investment properties comprising 1,078 car parking spaces at stages I to IX of the Taikoo Shing residential development in Hong Kong. The spaces in stage VI were offered to registered owners at Taikoo Shing in the fourth quarter of 2020, and the Group offered further car parking spaces in stages II to IV and VII to IX in batches during 2021. The Group also offered car parking spaces in stages I and V during the year. The car parking spaces were offered to non-registered owners at Taikoo Shing since September 2022. 34. Retirement Benefits The Group operates a number of defined benefit and defined contribution retirement benefit schemes for its employees, the assets of which are held in separate trustee administered funds. A defined benefit scheme is a retirement plan that defines the benefit that an employee will receive on retirement, usually dependent on one or more factors such as age, years of service and compensation. The Group has an obligation to provide participating employees with these benefits. A defined contribution scheme is a retirement plan under which the Group pays fixed contributions into a separate entity. The Group has no legal or constructive obligations to pay further contributions if the fund does not hold sufficient assets to pay all employee benefits relating to employee service in current and prior periods. Accounting Policy For defined benefit schemes, retirement benefit costs are assessed using the projected unit credit method. Under this method, the cost of providing retirement benefits is charged to the consolidated statement of profit or loss so as to spread the regular cost over the service lives of employees. The asset or liability recognised in the consolidated statement of financial position is the present value of the cost of providing these benefits (the defined benefit obligation) less the fair value of the plan assets at the end of the reporting period. The defined benefit obligation is calculated annually by independent actuaries and is determined by discounting the estimated future cash outflows using interest rates payable in respect of high quality corporate bonds. The plan assets are valued on a bid price basis. Actuarial gains and losses arising from experience adjustments and changes in actuarial assumptions are charged or credited to equity in the consolidated statement of other comprehensive income in the period in which they arise. Past-service costs are recognised immediately in the consolidated statement of profit or loss. Any differences between the implicit and actual return on assets are charged as remeasurements to the consolidated statement of other comprehensive income. For defined contribution schemes, the Group’s contributions are charged to the consolidated statement of profit or loss in the periods to which the contributions relate. Critical Accounting Estimates and Judgements The Group’s obligations and expenses in respect of defined benefit schemes are dependent on a number of factors that are determined using a number of actuarial assumptions. The details of the actuarial assumptions used, including applicable sensitivities are disclosed in note 34(f). SWIRE PROPERTIES ANNUAL REPORT 2022 183

NOTES TO THE FINANCIAL STATEMENTS 34. Retirement Benefits (continued) For the year ended 31st December 2022, disclosures in respect of defined benefit schemes are based on valuations prepared by Mercer (Hong Kong) Limited at 31st December 2021, which were updated to reflect the position at 31st December 2022 by Cannon Trustees Limited, the main administration manager of the Group’s defined benefit schemes. For the year ended 31st December 2021, disclosures are based on valuations prepared by Mercer (Hong Kong) Limited at 31st December 2021. The majority of the Group’s schemes are final salary guaranteed lump sum defined benefit plans. Contributions to the defined benefit retirement schemes are made in accordance with the funding rates recommended by independent qualified actuaries to ensure that the plans will be able to meet their liabilities as they become due. The funding rates are subject to annual review and are determined by taking into consideration the difference between the market values of the plans’ assets and the present value of accrued past service liabilities, on an ongoing basis, as computed by reference to actuarial valuations. The principal schemes in Hong Kong are valued by qualified actuaries for funding purposes under the provisions of Hong Kong’s Occupational Retirement Schemes Ordinance. The latest actuarial valuations indicate that the funding level for the year was 117% (2021: 113%) of the accrued liabilities on an ongoing basis. The Group expects to make contributions of HK$79 million to its defined benefit schemes in 2023. Most new employees in Hong Kong are offered the choice of joining the defined benefit retirement schemes or the mandatory provident fund (“MPF”) scheme. Where staff elect to join the MPF scheme, both the Company and the staff are required to contribute 5% of the employees’ relevant monthly income (capped at HK$30,000). Staff may elect to contribute more than the minimum as a voluntary contribution. Employees engaged outside Hong Kong are covered by appropriate local arrangements. (a) The amounts recognised in the consolidated statement of financial position are as follows: 2022 2021 HK$M HK$M Present value of funded obligations 1,018 1,442 Fair value of plan assets (1,032) (1,255) Net retirement benefit (assets)/liabilities (14) 187 Represented by: Retirement benefit assets (14) – Retirement benefit liabilities – 187 (14) 187 184

34. Retirement Benefits (continued) (b) Changes in the present value of the defined benefit obligations are as follows: 2022 2021 HK$M HK$M At 1st January 1,442 1,361 Current service cost 114 101 Interest expense 30 22 Actuarial (gains)/losses from changes in: – financial assumptions (436) 147 Experience losses/(gains) 18 (40) Transfer 5 (25) Benefits paid (155) (124) At 31st December 1,018 1,442 The weighted average duration of the defined benefit obligations is 10.92 years (2021: 10.90 years). (c) Changes in the fair value of plan assets are as follows: 2022 2021 HK$M HK$M At 1st January 1,255 1,226 Interest income 27 20 Return on plan assets, excluding interest income (173) 82 Contributions by employers 73 76 Transfer 5 (25) Benefits paid (155) (124) At 31st December 1,032 1,255 There were no plan amendments, curtailments or settlements during the year. (d) Net expenses recognised in the consolidated statement of profit or loss are as follows: 2022 2021 HK$M HK$M Current service cost 114 101 Net interest cost 3 2 117 103 The above net expenses were included in cost of sales and administrative expenses in the consolidated statement of profit or loss. Total retirement benefit costs charged to the consolidated statement of profit or loss for the year ended 31st December 2022 amounted to HK$132 million (2021: HK$124 million), including HK$15 million (2021: HK$21 million) in respect of defined contribution schemes. The actual return on defined benefit plan assets was a loss of HK$146 million (2021: gain of HK$102 million). SWIRE PROPERTIES ANNUAL REPORT 2022 185

NOTES TO THE FINANCIAL STATEMENTS 34. Retirement Benefits (continued) (e) The plan assets are invested in the Swire Group Unitised Trust (“the Unitised Trust”). The Unitised Trust has four sub-funds in which the assets may be invested in accordance with separate and distinct investment policies and objectives. The Unitised Trust and sub-funds are overseen by an investment committee, which meets four times a year. The make-up of the Unitised Trust is the result of the asset allocation of each plan. The asset allocation of each plan targets a mix of equities, fixed income, absolute return funds and short duration bond sub-funds. The management of the assets within the sub-funds is delegated by the investment committee to a number of reputable investment managers. The plan assets comprise: Defined benefit plans 2022 2021 HK$M HK$M Equities Asia Pacific 76 88 Europe 67 104 North America 228 317 Emerging markets 248 320 Bonds Global 86 91 Emerging markets 11 13 Absolute return funds 283 316 Cash 33 6 1,032 1,255 At 31st December 2022, the prices of 96% of equities and 29% of bonds were quoted on active markets (2021: 96% and 21% respectively). The remainder of the prices were not quoted on active markets. The most significant risk facing the defined benefit schemes of the Group is market risk. This risk embodies the potential for losses and gains and includes price risk, interest rate risk and currency risk as well as factors specific to an individual investment and its issuer and risk specific to a certain market. Market risk is managed principally through diversification of investments by the appointed investment managers. Investment managers enter into agreements that stipulate the performance objective of the investments, which is referenced to a recognised benchmark. The investment committee monitors the overall market risk position on a quarterly basis. 186

34. Retirement Benefits (continued) (f) The significant actuarial assumptions used are as follows: 2022 2021 Discount rate 5.08% 2.08% Expected rate of future salary increases 7.42% to 12.38% p.a. for 2023; 5.40% to 6.90% p.a. for 2022; 4.00% p.a. thereafter 4.50% p.a. thereafter The sensitivity of the defined benefit obligations to changes in actuarial assumptions is: 2022 2021 Increase/(Decrease) in Increase/(Decrease) in defined benefit obligation defined benefit obligation Change in Increase in Decrease in Change in Increase in Decrease in assumption assumption assumption assumption assumption assumption HK$M HK$M HK$M HK$M Discount rate 0.5% (59) 46 0.5% (74) 80 Expected rate of future salary increases 0.5% 63 (60) 0.5% 78 (73) The above sensitivity analyses are based on a change in an assumption while holding all other assumptions constant. In practice, this is unlikely to occur, and changes in some of the assumptions may be correlated. When calculating the sensitivity of the defined benefit obligations to significant actuarial assumptions the same method has been applied as when calculating the retirement benefit liability recognised within the consolidated statement of financial position. 35. Share Capital Ordinary shares HK$M Issued and fully paid with no par value: At 1st January 2022 and 31st December 2022 5,850,000,000 10,449 At 1st January 2021 and 31st December 2021 5,850,000,000 10,449 There was no purchase, sale or redemption by the Company, or any of its subsidiaries, of the Company’s shares during the years ended 31st December 2022 and 31st December 2021. SWIRE PROPERTIES ANNUAL REPORT 2022 187

NOTES TO THE FINANCIAL STATEMENTS 36. Reserves Property Cash flow Revenue Merger revaluation hedge Translation reserve reserve reserve reserve reserve Total HK$M HK$M HK$M HK$M HK$M HK$M At 1st January 2022 – as originally stated 277,961 (1,108) 2,005 28 2,820 281,706 – impact of adjustments in note 1(c) (522) – – – (9) (531) – as restated 277,439 (1,108) 2,005 28 2,811 281,175 Profit for the year 7,980 – – – – 7,980 Other comprehensive income Defined benefit plans – remeasurement gains recognised during the year 245 – – – – 245 – deferred tax (40) – – – – (40) Cash flow hedges – losses recognised during the year – – – (16) – (16) – transferred to net finance charges – – – (13) – (13) – transferred to operating profit – – – (1) – (1) – deferred tax – – – 5 – 5 Share of other comprehensive income of joint venture and associated companies – – 2 6 (1,752) (1,744) Net translation differences on foreign operations recognised during the year – – – – (3,213) (3,213) Total comprehensive income for the year 8,185 – 2 (19) (4,965) 3,203 2021 second interim dividend (note 13) (3,744) – – – – (3,744) 2022 first interim dividend (note 13) (1,872) – – – – (1,872) At 31st December 2022 280,008 (1,108) 2,007 9 (2,154) 278,762 188

36. Reserves (continued) Property Cash flow Revenue Merger revaluation hedge Translation reserve reserve reserve reserve reserve Total HK$M HK$M HK$M HK$M HK$M HK$M At 1st January 2021 – as originally stated 276,245 (1,108) 1,915 41 1,194 278,287 – impact of adjustments in note 1(c) (513) – – – (7) (520) – as restated 275,732 (1,108) 1,915 41 1,187 277,767 Profit for the year (restated) 7,112 – – – – 7,112 Other comprehensive income Revaluation of properties previously occupied by the Group – gains recognised during the year – – 94 – – 94 – deferred tax – – (4) – – (4) Defined benefit plans – remeasurement losses recognised during the year (26) – – – – (26) – deferred tax 4 – – – – 4 Cash flow hedges – losses recognised during the year – – – (38) – (38) – transferred to net finance charges – – – 14 – 14 – deferred tax – – – 4 – 4 Share of other comprehensive income of joint venture and associated companies – – – 7 554 561 Net translation differences on foreign operations recognised during the year (restated) – – – – 1,070 1,070 Total comprehensive income for the year (restated) 7,090 – 90 (13) 1,624 8,791 2020 second interim dividend (note 13) (3,569) – – – – (3,569) 2021 first interim dividend (note 13) (1,814) – – – – (1,814) At 31st December 2021 (restated) 277,439 (1,108) 2,005 28 2,811 281,175 (a) The Group’s revenue reserve includes retained revenue reserves from joint venture companies amounting to HK$14,219 million (2021 (Restated): HK$13,071 million) and retained revenue reserves from associated companies amounting to HK$160 million (2021: HK$148 million). (b) The Group’s revenue reserve includes HK$3,978 million (2021: HK$3,744 million) representing the declared second interim dividend for the year (note 13). (c) The Group adopted merger accounting in accordance with Accounting Guideline 5, Merger Accounting for Common Control Combinations (issued by the HKICPA) to account for the acquisition of all the shares of Swire Properties US Inc and Swire Properties One LLC in January 2010. These companies were wholly-owned subsidiaries of the immediate holding company of Swire Properties Limited. (d) At 31st December 2022, the Group’s cash flow hedge reserve includes HK$5 million (net of tax) (2021: a credit of HK$25 million) relating to the currency basis element of the Group’s derivatives which is recognised separately as a cost of hedging. SWIRE PROPERTIES ANNUAL REPORT 2022 189

NOTES TO THE FINANCIAL STATEMENTS 37. Company Statement of Financial Position and Reserves (a) Company Statement of Financial Position 2022 2021 At 31st December 2022 Note HK$M HK$M ASSETS AND LIABILITIES Non-current assets Property, plant and equipment 33 29 Intangible assets 126 100 Right-of-use assets 34 8 Subsidiary companies 126,204 118,148 Loans due from joint venture companies 2,801 2,673 Associated companies 3 3 Deferred tax assets – 10 Other financial assets at amortised cost – 505 Retirement benefit assets 23 – 129,224 121,476 Current assets Trade and other receivables 614 62 Taxation recoverable – 3 Cash and cash equivalents 470 8,319 1,084 8,384 Current liabilities Trade and other payables 22,791 42,091 Taxation payable 8 – Lease liabilities due within one year 12 8 22,811 42,099 Net current liabilities (21,727) (33,715) Total assets less current liabilities 107,497 87,761 Non-current liabilities Long-term lease liabilities 22 1 Deferred tax liabilities 25 – Retirement benefit liabilities – 160 47 161 NET ASSETS 107,450 87,600 EQUITY Equity attributable to the Company’s shareholders Share capital 35 10,449 10,449 Reserves 37(b) 97,001 77,151 TOTAL EQUITY 107,450 87,600 Guy Bradley May Y. Wu Directors Hong Kong, 9th March 2023 190

37. Company Statement of Financial Position and Reserves (continued) (b) The movement of the Company reserves during the year are as follows: Revenue reserve HK$M Company At 1st January 2022 77,151 Profit for the year (note 12) 25,282 Other comprehensive income Defined benefit plans – remeasurement gains recognised during the year 221 – deferred tax (37) Total comprehensive income for the year 25,466 2021 second interim dividend (note 13) (3,744) 2022 first interim dividend (note 13) (1,872) At 31st December 2022 97,001 Company At 1st January 2021 76,923 Profit for the year (note 12) 5,629 Other comprehensive income Defined benefit plans – remeasurement losses recognised during the year (22) – deferred tax 4 Total comprehensive income for the year 5,611 2020 second interim dividend (note 13) (3,569) 2021 first interim dividend (note 13) (1,814) At 31st December 2021 77,151 (i) Distributable reserves of the Company at 31st December 2022 amounted to HK$97,001 million (2021: HK$77,151 million). (ii) The Company’s revenue reserve includes HK$3,978 million (2021: HK$3,744 million) representing the declared second interim dividend for the year (note 13). SWIRE PROPERTIES ANNUAL REPORT 2022 191

NOTES TO THE FINANCIAL STATEMENTS 38. Non-controlling Interests The movement of non-controlling interests during the year is as follows: 2022 2021 HK$M HK$M Restated At 1st January – as originally stated 2,003 1,944 – impact of adjustments in note 1(c) (17) (16) – as restated 1,986 1,928 Share of profit less losses for the year 247 167 Share of translation differences on foreign operations (110) 23 Share of total comprehensive income 137 190 Capital contribution from a non-controlling interest 1,020 – Dividends paid and payable (96) (132) At 31st December 3,047 1,986 39. Capital Commitments 2022 2021 HK$M HK$M (a) The Group’s outstanding capital commitments at the year end in respect of: Property, plant and equipment Contracted but not provided for 12 13 Authorised by Directors but not contracted for 491 356 Investment properties Contracted but not provided for 2,986 4,541 Authorised by Directors but not contracted for 17,028 10,924 20,517 15,834 The Group’s share of capital commitments of joint venture companies at the year end* Contracted but not provided for 393 150 Authorised by Directors but not contracted for 7,044 4,700 7,437 4,850 * of which the Group is committed to funding HK$331 million (2021: HK$1,146 million). At 31st December 2022, the Group was committed to inject capital of HK$421 million (2021: nil) into joint venture companies. (b) At 31st December 2022, the Group had unprovided contractual obligations for future repairs and maintenance on investment properties of HK$380 million (2021: HK$213 million). 192

40. Contingencies Accounting Policy Contingent liabilities are possible obligations that arise from past events and the existence of which will only be confirmed by the occurrence or non-occurrence of one or more future events not wholly within the control of the Group. Where it is not probable that an outflow of economic benefits will be required, or the amount cannot be estimated reliably, the obligation is disclosed as a contingent liability, unless the probability of an outflow of economic benefits is remote. Financial guarantee contracts are recognised as a financial liability at the time the guarantee is issued. The liability is initially measured at fair value and subsequently at the higher of: – the amount determined in accordance with the expected credit loss model under HKFRS 9 “Financial Instruments” and – the amount initially recognised less, where appropriate, the cumulative amount of income recognised in accordance with the principles of HKFRS 15 “Revenue from Contracts with Customers”. The fair value of financial guarantees is determined based on the present value of the difference in cash flows between the contractual payments required under the debt instrument and the payments that would be required without the guarantee, or the estimated amount that would be payable to a third party for assuming the obligations. Where guarantees in relation to loans or other payables of associates are provided for no compensation, the fair values are accounted for as contributions and recognised as part of the cost of the investment. 2022 2021 HK$M HK$M Guarantees provided in respect of: Bank loans and other liabilities of joint venture companies 4,181 3,643 Bank guarantees given in lieu of utility deposits and others 73 76 4,254 3,719 The Group has assessed the fair value of the above guarantees and does not consider them to be material. They have therefore not been recognised in the consolidated statement of financial position. SWIRE PROPERTIES ANNUAL REPORT 2022 193

NOTES TO THE FINANCIAL STATEMENTS 41. Lease Commitments Accounting Policy Leases in which a significant portion of the risks and rewards of ownership are retained by the lessor are classified as operating leases. Receipts by the Group as a lessor under operating leases (net of any incentives paid to lessees) are recognised as income in the consolidated statement of profit or loss on a straight-line basis over the period of the lease. For commenced leases (which are not identified as low-value or short-term leases) undertaken by the Group as a lessee, right-of-use assets and the corresponding lease liabilities are recognised in the financial statements when the leased assets become available for use. Commitments in respect of leases payable by the Group as a lessee represent the future lease payments for (i) committed leases which have not yet commenced at the year-end date and (ii) short-term leases. The Group acts as both lessor and lessee under operating leases. Details of the Group’s commitments under non-cancellable operating leases are set out as follows: (a) Lessor – lease receivables The leases for investment properties typically run for periods of three to six years. The retail turnover-related rental income received from investment properties during the year amounted to HK$837 million (2021: HK$986 million). The future aggregate minimum lease receipts under non-cancellable operating leases were receivable by the Group at the year end as follows: 2022 2021 HK$M HK$M Investment properties Within 1 year 8,100 8,868 Between 1 and 2 years 6,691 7,219 Between 2 and 3 years 4,955 5,512 Between 3 and 4 years 3,561 3,925 Between 4 and 5 years 2,317 2,922 After 5 years 3,006 4,408 28,630 32,854 Assets held for deployment on operating leases at the year end were as follows: 2022 2021 HK$M HK$M Investment properties at fair value 248,114 236,703 (b) Lessee At 31st December 2022, there were no future lease payments under leases committed but not yet commenced by the Group and no short-term leases commitments which were significantly dissimilar to those relating to the portfolio of short-term leases for which expenses were recognised for the year ended 31st December 2022 (2021: None). 194

42. Related Party Transactions Accounting Policy Related parties of the Group are individuals and companies, including subsidiary, fellow subsidiary, joint venture and associated companies and key management of the Group or the parent of the Group (including close members of their families), where the individual or company has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operating decisions. There is an agreement for services (“Services Agreement”), in respect of which John Swire & Sons (H.K.) Limited (“JS&SHK”), an intermediate holding company, provides services to various companies in the Group and under which costs are reimbursed and fees payable. In return for these services, JS&SHK receives annual fees calculated as 2.5% of the Group’s relevant consolidated profits before taxation and non-controlling interests after certain adjustments. The Services Agreement were renewed on 1st October 2022 for three years expiring on 31st December 2025. For the year ended 31st December 2022, service fees payable amounted to HK$186 million (2021: HK$200 million). Expenses of HK$92 million (2021: HK$88 million) were reimbursed at cost; in addition, HK$80 million (2021: HK$82 million) in respect of shared administrative services was reimbursed. Under a tenancy framework agreement (the “Tenancy Framework Agreement”) between JS&SHK, Swire Pacific Limited and the Company dated 14th August 2014, members of the Group enter into tenancy agreements with members of the JS&SHK group and members of the Swire Pacific group from time to time on normal commercial terms based on prevailing market rentals. The Tenancy Framework Agreement was renewed on 1st October 2021 for a further term of three years expiring on 31st December 2024. For the year ended 31st December 2022, the aggregate rentals payable to the Group by members of the JS&SHK group and members of the Swire Pacific group under tenancies to which the Tenancy Framework Agreement applies amounted to HK$109 million (2021: HK$113 million) and HK$38 million (2021: HK$43 million) respectively. The above transactions under the Services Agreement and the Tenancy Framework Agreement are continuing connected transactions, in respect of which the Company has complied with the disclosure requirements of Chapter 14A of the Listing Rules. In addition, the following is a summary of significant transactions between the Group and related parties (including transactions under the Tenancy Framework Agreement), which were carried out in the normal course of the Group’s business, in addition to those transactions disclosed elsewhere in the financial statements. Joint venture Fellow Immediate Intermediate companies subsidiary companies holding company holding company Other related parties 2022 2021 2022 2021 2022 2021 2022 2021 2022 2021 Note HK$M HK$M HK$M HK$M HK$M HK$M HK$M HK$M HK$M HK$M Purchase of goods (a) – – – – – – – – – 1 Purchase of services (a) – – 28 28 – – – – – – Rendering of services (a) 67 57 – – – – 8 1 – 1 Rental revenue (b) – – 28 32 10 11 109 113 1 1 Rental expenses (b) 9 7 – – – – – – – – Revenue from hotels 9 19 – – – – 1 1 70 14 Interest income (c) 50 79 – – – – – – – – Interest charges (c) 16 9 – – – – – – – – Notes: (a) Purchase of goods and rendering of services from and to related parties were conducted in the normal course of business at prices and on terms no less favourable to the Group than those charged by/to and contracted with other suppliers/customers of the Group. (b) The Group has, in the normal course of its business, entered into lease agreements with related parties to lease premises for varying periods up to six years. The leases were entered into on normal commercial terms. (c) Loans advanced to joint venture and associated companies at 31st December 2022 are disclosed in notes 20 and 21. Advances from joint venture and associated companies are disclosed in note 27. The amounts due from the immediate holding company at 31st December 2022 is disclosed in note 25. The balance arises in the normal course of business, is non-interest-bearing and repayable within one year. Remuneration of key management, which includes Executive and Non-Executive Directors and Executive Officers, is disclosed in note 9. SWIRE PROPERTIES ANNUAL REPORT 2022 195

NOTES TO THE FINANCIAL STATEMENTS 43. Notes to the Consolidated Statement of Cash Flows (a) Reconciliation of operating profit to cash generated from operations 2022 2021 HK$M HK$M Restated Operating profit 9,024 7,834 Change in fair value of investment properties (801) 1,947 Change in fair value of assets classified as held for sale (48) (42) Change in fair value of financial assets at fair value through profit or loss – 12 Depreciation 296 338 Amortisation of initial leasing costs on investment properties 79 35 Amortisation of intangible assets 53 47 Gains on disposal of subsidiary companies (520) (121) Gains on disposal of investment properties (31) (1,028) Gains on disposal of property, plant and equipment – (9) Gains on disposal of assets classified as held for sale (20) (36) Other items 144 (28) Operating profit before working capital changes 8,176 8,949 Decrease in amounts due from immediate holding company 1 15 Increase in properties for sale (1,667) (2,832) (Increase)/Decrease in stocks (1) 1 Increase in trade and other receivables (89) (96) Increase in trade and other payables 62 867 (Decrease)/Increase in contract liabilities (106) 98 (Decrease)/Increase in retirement benefit liabilities (44) 26 Cash generated from operations 6,332 7,028 (b) Purchase of property, plant and equipment 2022 2021 HK$M HK$M Land and buildings 12 8 Plant and equipment 121 172 Total 133 180 The above purchase amounts do not include interest capitalised on property, plant and equipment. 196

43. Notes to the Consolidated Statement of Cash Flows (continued) (c) Disposal of subsidiary companies 2022 HK$M Net assets disposed of: Investment properties 556 Trade and other receivables 1 Trade and other payables (8) Taxation payable (2) Deferred tax liabilities (7) 540 Gains on disposal 520 1,060 Satisfied by: Cash received (net of transaction costs) 1,060 Analysis of net inflow of cash and cash equivalents from disposal: Net cash proceeds 1,060 The disposal of subsidiary companies consists of the sale of the Group’s interests in certain properties in Hong Kong. Refer to the tables with the headings “Audited Financial Information” on page 82 for details of the changes in financing during the year. 44. Immediate and Ultimate Holding Company The immediate holding company is Swire Pacific Limited, a company incorporated and listed in Hong Kong. The ultimate holding company is John Swire & Sons Limited, a company incorporated in the United Kingdom. SWIRE PROPERTIES ANNUAL REPORT 2022 197

PRINCIPAL ACCOUNTING POLICIES Apart from the accounting policies presented within the corresponding notes to the financial statements, the other principal accounting policies applied in the preparation of these consolidated financial statements are set out below: 1. Basis of Preparation The consolidated financial statements have been prepared in accordance with Hong Kong Financial Reporting Standards (“HKFRS”) issued by the Hong Kong Institute of Certified Public Accountants. The consolidated financial statements include “Audited Financial Information” in the Financing section on pages 81 to 89. The consolidated financial statements have been prepared under the historical cost convention as modified in relation to the revaluation of investment properties, put options in respect of non-controlling interests, financial assets at fair value through profit or loss and other comprehensive income, defined benefits assets/liabilities and derivative financial instruments, each of which are carried at fair value. 2. Basis of Consolidation The consolidated financial statements incorporate the financial statements of Swire Properties Limited, its subsidiary companies (together referred to as the “Group”) and the Group’s interests in joint venture and associated companies. The Group uses the acquisition method of accounting to account for business combinations. The consideration transferred for the acquisition of a subsidiary company is the fair values of the assets transferred, the liabilities incurred and the equity interests issued by the Group. The consideration transferred includes the fair value of any asset or liability resulting from a contingent consideration arrangement. Acquisition-related costs are generally expensed as incurred. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date. On an acquisition-by- acquisition basis, the Group recognises any non-controlling interest in the acquired subsidiary either at fair value or at the non- controlling interest’s proportionate share of the acquired subsidiary’s net assets. The excess of the consideration transferred, the amount of any non-controlling interest in the acquired subsidiary and the acquisition- date fair value of any previous equity interest in the acquired subsidiary over the fair value of the Group’s share of the identifiable net assets acquired is recorded as goodwill. If this is less than the fair value of the net assets of the acquired subsidiary, the difference is recognised directly in the consolidated statement of profit or loss. Intercompany transactions, balances and unrealised gains on transactions between Group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of impairment of the asset transferred. Accounting policies of subsidiary companies have been changed where necessary to ensure consistency with the policies adopted by the Group. The Group treats transactions with non-controlling interests as transactions with equity owners of the Group. For purchases from non-controlling interests, the difference between any consideration paid and the relevant share acquired of the carrying value of net assets of the subsidiary company is recorded in equity. Gains or losses on disposals to non-controlling interests where control is not lost are also recorded in equity. When the Group ceases to have control, any retained interest in the entity is remeasured to its fair value, with the change in carrying amount recognised in the consolidated statement of profit or loss. The fair value is the initial carrying amount for the purposes of subsequently accounting for the retained interest as an associated company, joint venture company or financial asset. In addition, any amounts previously recognised in other comprehensive income in respect of that entity are accounted for as if the Group had directly disposed of the related assets or liabilities. This may mean that amounts previously recognised in the consolidated statement of other comprehensive income are reclassified to the consolidated statement of profit or loss. Where the Group enters into a contract that contains an obligation (for example a written put option exercisable by the contract counterparty) to acquire shares in a partly-owned subsidiary company from the owner of the non-controlling interest, which is not part of a business combination, the Group records a financial liability in respect of the present value of the redemption amount with a corresponding charge directly to equity. Changes to the value of the financial liability are recognised in the consolidated statement of profit or loss within net finance charges. 198

2. Basis of Consolidation (continued) In the Group’s consolidated statement of financial position, its interests in joint venture and associated companies are accounted for using the equity method of accounting and are initially recognised at cost. The excess of the cost of investment in joint venture and associated companies over the fair value of the Group’s share of the identifiable net assets acquired at the date of acquisition represents goodwill. The Group’s interests in joint venture and associated companies include goodwill identified on acquisitions, net of any accumulated impairment loss. The Group’s share of its joint venture and associated companies’ post-acquisition profits or losses is recognised in the consolidated statement of profit or loss, and its share of post-acquisition movements in the consolidated statement of other comprehensive income is recognised in the consolidated statement of comprehensive income. The cumulative post-acquisition movements are adjusted against the carrying amount of the investment. When the Group’s share of losses equals or exceeds its interest in the joint venture or associated company, including any other unsecured receivables, the Group does not recognise further losses, unless it has incurred obligations or made payments on behalf of the joint venture or associated company. The Group assesses at the end of each reporting period whether there is any objective evidence that its interests in joint venture and associated companies are impaired. Such objective evidence includes whether there has been any significant adverse changes in the technological, market, economic or legal environment in which the joint venture and associated companies operate or whether there has been a significant or prolonged decline in value below their cost. If there is an indication that an interest in a joint venture or associated company is impaired, the Group assesses whether the entire carrying amount of the investment (including goodwill) is recoverable. An impairment loss is recognised in the consolidated statement of profit or loss for the amount by which the carrying amount is higher than the higher of the investment’s fair value less costs of disposal or value-in-use. Any reversal of such impairment loss in subsequent periods is credited to the consolidated statement of profit or loss. The Group recognises the disposal of an interest in a joint venture company when it ceases to have joint control and the risks and rewards of ownership have passed to the acquirer. If the ownership interest in an associated company is reduced but significant influence is retained, only a proportionate share of the amounts previously recognised in the consolidated statement of other comprehensive income are reclassified to the consolidated statement of profit or loss where appropriate. Unrealised gains on transactions between the Group and its joint venture and associated companies are eliminated to the extent of the Group’s interest in these companies. Unrealised losses on assets transferred between the Group and its joint venture and associated companies are also eliminated unless the transactions provide evidence of impairment of the assets transferred. Accounting policies of joint venture and associated companies have been changed where necessary to ensure consistency with the policies adopted by the Group. Dilution gains and losses arising in respect of investments in associated companies are recognised in the consolidated statement of profit or loss. 3. Subsidiary Companies Subsidiary companies are all entities over which the Group has control. The Group controls an entity when the Group is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. Subsidiary companies are consolidated from the date on which control is transferred to the Group. They are deconsolidated from the date that control ceases. Investments in subsidiary companies in the Company’s standalone financial statements are stated at cost less provision for any impairment losses. Income from subsidiary companies is accounted for on the basis of dividends received and receivable. Long-term loans to subsidiary companies are considered to be quasi-equity in nature where there is no defined repayment terms and no expectation of repayment. 4. Joint Venture and Associated Companies In the Company’s statement of financial position, its investments in joint venture and associated companies are stated at cost less provision for any impairment losses. Income from joint venture and associated companies is recognised by the Company on the basis of dividends received and receivable. Long-term loans to joint venture and associated companies are subject to expected credit losses assessment. The impairment methodology applied depends on whether there has been a significant increase in credit risk. SWIRE PROPERTIES ANNUAL REPORT 2022 199

PRINCIPAL ACCOUNTING POLICIES 5. Foreign Currency Translation (a) Functional and presentation currency Items included in the financial statements of each of the Group’s entities are measured using the currency of the primary economic environment in which the entity operates (the “functional currency”). The consolidated financial statements are presented in Hong Kong dollars, which is the Company’s functional and presentation currency. (b) Transactions and balances Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the consolidated statement of profit or loss, except when deferred in the consolidated statement of other comprehensive income as qualifying cash flow hedges or qualifying net investment hedges. When a gain or loss on a non-monetary item is recognised directly in the consolidated statement of other comprehensive income, any associated translation difference is also recognised directly in the consolidated statement of other comprehensive income. When a gain or loss on a non-monetary item is recognised in the consolidated statement of profit or loss, any associated translation difference is also recognised in the consolidated statement of profit or loss. (c) Group companies The results and financial position of all the Group entities (none of which has the currency of a hyperinflationary economy) that have a functional currency different from the presentation currency are translated into the presentation currency as follows: (i) Assets and liabilities for each statement of financial position presented are translated at the closing rate at the date of that statement of financial position; (ii) Income and expenses for each statement of profit or loss are translated at average exchange rates (unless this average is not a reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates, in which case income and expenses are translated at the dates of the transactions); and (iii) All resulting exchange differences are recognised in the statement of other comprehensive income and accumulated in a separate component in equity. On consolidation, exchange differences arising from the translation of the net investment in foreign operations, and of borrowings and other currency instruments designated as hedges of such investments, are taken to the consolidated statement of other comprehensive income. When a foreign operation is partially disposed of or sold, exchange differences that were recorded in equity are reclassified in the consolidated statement of profit or loss as part of the gain or loss on sale. Goodwill and fair value adjustments arising on the acquisition of a foreign entity are treated as assets and liabilities of the foreign entity and translated at the closing rate. 6. Provisions Provisions are recognised when the Group has a present legal or constructive obligation as a result of past events; it is more likely than not that an outflow of resources will be required to settle the obligation; and the amount has been reliably estimated. Provisions are not recognised for future operating losses. Where there are a number of similar obligations, the likelihood that an outflow will be required in settlement is determined by considering the class of obligations as a whole. A provision is recognised even if the likelihood of an outflow with respect to any one item included in the same class of obligations may be small. 7. Government Grants The Group recognises government grants when there is reasonable assurance that the Group will comply with the conditions attached to the grants and the grants will be received. Government grants, that are intended to compensate the Group for expenses incurred, are recognised in the consolidated statement of profit or loss on a systematic basis in the years in which the related expenses are recognised. 200

PRINCIPAL SUBSIDIARY, JOINT VENTURE AND ASSOCIATED COMPANIES Showing proportion of capital owned at 31st December 2022 Owned Attributable Owned by to the Group directly subsidiaries Issued and fully paid up % % % shares/Registered capital Principal activities Subsidiary companies: Incorporated in Hong Kong with limited liability and operating in Hong Kong: Achieve Bright Limited 100 100 – 100 shares (HK$100) Property trading Citiluck Development Limited 100 – 100 1,000 shares (HK$1,000) Property investment Cityplaza Holdings Limited 100 100 – 100 shares (HK$1,000) Property investment Coventry Estates Limited 100 – 100 4 shares (HK$40) Property investment Joyful Sincere Limited (d) 80 – 100 1 share (HK$1) Property trading One Queen’s Road East Limited 100 – 100 200 shares (HK$200) Property investment Pacific Place Holdings Limited 100 100 – 2 shares (HK$2) Property investment Redhill Properties Limited 100 100 – 250,000 shares (HK$7,300,000) Property investment Super Gear Investment Limited 100 100 – 2 shares (HK$2) Property investment Swire Properties (Finance) Limited 100 100 – 1,000,000 shares Financial services (HK$1,000,000) Swire Properties Management Limited 100 100 – 2 shares (HK$20) Property management Swire Properties MTN Financing Limited 100 100 – 1 share (HK$1) Financial services Swire Properties Real Estate Agency Limited 100 100 – 2 shares (HK$20) Real estate agency Taikoo Place Holdings Limited 100 100 – 2 shares (HK$2) Property investment Incorporated in the Chinese Mainland with limited liability and operating in the Chinese Mainland: (Sino-foreign joint venture) Taikoo Hui (Guangzhou) Development 97 – 97 Registered capital of Property investment Company Limited (b) RMB3,050,000,000 (Wholly foreign owned enterprises) Beijing Anye Property Management 100 – 100 Registered capital of Property Investment Company Limited (b) RMB209,500,000 Beijing Sanlitun Hotel Management 100 – 100 Registered capital of Hotel investment Company Limited (b) RMB800,000,000 Beijing Sanlitun North Property Management 100 – 100 Registered capital of Property investment Company Limited (b) RMB2,784,000,000 Beijing Sanlitun South Property Management 100 – 100 Registered capital of Property investment Company Limited (b) RMB1,598,000,000 Sunshine Melody (Guangzhou) Properties 100 – 100 Registered capital of Property investment Management Limited RMB295,000,000 Swire Properties (China) Investment 100 – 100 Registered capital of Holding company Company Limited (b) US$30,000,000 (Domestic company) Beijing Tianlian Real Estate 100 – 100 Registered capital of Holding company Company Limited (b)(d) RMB865,000,000 (Sino-foreign owned enterprises) Xi’an Tengyun Real Estate Company Limited (b) 70 – 70 Registered capital of Property trading and RMB3,653,743,600 investment Notes: (a) This table lists the principal subsidiary, joint venture and associated companies of the Group including those which, in the opinion of the Directors, materially contribute to the net income of the Group or hold a material portion of the assets or liabilities of the Group. To give full details of these companies would, in the opinion of the Directors, result in particulars of excessive length. (b) Translated name. (c) Group interest held through joint venture and associated companies. (d) Companies the accounts of which are not audited by PricewaterhouseCoopers. These companies accounted for approximately 2.0% of attributable net assets at 31st December 2022. SWIRE PROPERTIES ANNUAL REPORT 2022 201

PRINCIPAL SUBSIDIARY, JOINT VENTURE AND ASSOCIATED COMPANIES Showing proportion of capital owned at 31st December 2022 Owned Attributable Owned by to the Group directly subsidiaries Issued and fully paid up % % % shares/Registered capital Principal activities Subsidiary companies (continued): Incorporated in the United States with limited liability and operating in the United States: 700 Brickell City Centre LLC 100 – 100 Limited Liability Company Property investment Brickell City Centre Plaza LLC 100 – 100 Limited Liability Company Property investment Brickell City Centre Project LLC 100 – 100 Limited Liability Company Property trading and investment Brickell City Centre Retail LLC 62.93 – 87.93 Limited Liability Company Property investment Swire Jadeco LLC 100 – 100 Limited Liability Company Property trading Swire Properties Inc 100 – 100 1,000 shares of US$0.01 each Holding company Swire Properties One LLC 100 – 100 Limited Liability Company Holding company Swire Properties US Inc 100 – 100 1,000 shares of US$0.01 each Holding company Swire Realty LLC 100 – 100 Limited Liability Company Real estate agency Incorporated in the British Virgin Islands with limited liability and operating in Hong Kong: Boom View Holdings Limited 100 100 – 2 shares of US$1 each Property investment Cherish Shine Limited 100 100 – 1 share of US$1 Property investment High Grade Ventures Limited 100 100 – 1 share of US$1 Property trading and investment Novel Ray Limited 100 100 – 1 share of US$1 Property investment One Pacific Place Limited 100 – 100 1 share of US$1 Property investment Sino Flagship Investments Limited 100 100 – 1 share of US$1 Property investment Swire and Island Communication 60 60 – 100 shares of HK$10 each Property investment Developments Limited (d) and 1 non-voting dividend share of HK$10 Swire Properties China Holdings Limited 100 100 – 1 share of US$1 Holding company Joint venture companies: Incorporated in Hong Kong with limited liability and operating in Hong Kong: Hareton Limited (d) 50 – 50 100 shares (HK$1,000) Property investment Pacific Grace Limited 50 – (c) 2 shares (HK$2) Property investment Richly Leader Limited 50 – 50 1,000,000,000 shares Property investment (HK$700,000,000) Incorporated in the United States with limited liability and operating in the United States: Swire Brickell Key Hotel, Ltd. 75 – 75 Florida Partnership Hotel investment 202

Owned Attributable Owned by to the Group directly subsidiaries Issued and fully paid up % % % shares/Registered capital Principal activities Joint venture companies (continued): Incorporated in the British Virgin Islands with limited liability: Dazhongli Properties Limited 50 – 50 1,000 shares of US$1 each Holding company (operating in the Chinese Mainland) Fortune Access Holdings Limited 25 – 25 100 shares of US$1 each Holding company (operating in Hong Kong) Great City China Holdings Limited 65 – 65 100 shares of US$1 each Holding company (operating in the Chinese Mainland) Honster Investment Limited 50 – 50 2 shares of US$1 each Holding company (operating in Hong Kong) Newfoundworld Investment Holdings Limited 26.67 – 26.67 15 shares of US$1 each Holding company (operating in Hong Kong) Incorporated in the Chinese Mainland with limited liability and operating in the Chinese Mainland: (Domestic companies) Beijing Linlian Real Estate Company Limited (b) 50 – 50 Registered capital of Property investment RMB400,000,000 Shanghai Kaiye Commercial Management 60 – 60 Registered capital of Property management Company Limited (b) RMB10,000,000 (Wholly foreign owned enterprises) Chengdu Qianhao Real Estate Company Limited 65 – (c) Registered capital of Property investment US$329,000,000 Guan Feng (Shanghai) Real Estate Development 50 – (c) Registered capital of Property investment Company Limited (b) US$1,136,530,000 (Sino-foreign owned enterprises) Beijing Xingtaitonggang Properties 35 – 35 Registered capital of Property investment Company Limited (b) RMB9,500,000,000 Shanghai Qianxiu Company Limited (b) 50 – 50 Registered capital of Property investment RMB1,549,777,000 Sanya CDF Seaside Investment & Development 50 – 50 Registered capital of Property investment Company Limited (b) RMB2,500,000,000 Incorporated in Indonesia with limited liability and operating in Indonesia: PT Jantra Swarna Dipta 50 – 50 1,202,044 shares of Property trading Rp1,000,000 each Associated companies: Incorporated in Hong Kong with limited liability and operating in Hong Kong: Greenroll Limited (d) 20 20 – 45,441,000 shares Hotel investment (HK$454,410,000) Queensway Hotel Limited (d) 20 – (c) 100,000 shares Hotel investment (HK$1,000,000) Shangri-La International Hotels (Pacific Place) 20 20 – 10,005,000 shares Hotel investment Limited (HK$10,005,000) Incorporated in Vietnam with limited liability and operating in Vietnam: City Garden Thu Thiem Limited Liability 20 – (c) Charter capital of Property trading Company (d) VND969,797,500,000 SWIRE PROPERTIES ANNUAL REPORT 2022 203

SCHEDULE OF PRINCIPAL GROUP PROPERTIES At 31st December 2022 Gross floor areas in square feet Hong Kong Chinese Mainland U.S.A. and Elsewhere Totals Held through Held through Held through Held through subsidiaries Held through other Held through other Held through other Held through and other subsidiaries companies subsidiaries companies subsidiaries companies subsidiaries companies Completed properties for investment Retail 2,321,585 223,903 3,239,776 2,534,983 496,508 – 6,057,869 8,816,755 Office 8,474,662 738,548 1,693,125 1,208,566 – – 10,167,787 12,114,901 Residential/Serviced apartment 555,551 – 50,376 143,059 – – 605,927 748,986 Hotels 358,371 435,770 678,897 498,603 – 258,750 1,037,268 2,230,391 11,710,169 1,398,221 5,662,174 4,385,211 496,508 258,750 17,868,851 23,911,033 Property developments for investment Retail – – – 1,071,720 – – – 1,071,720 Office 223,303 – – – – – 223,303 223,303 Residential/Serviced apartment 14,768 – – – – – 14,768 14,768 Under planning – – 2,364,668 1,415,930 1,510,000* – 3,874,668 5,290,598 238,071 – 2,364,668 2,487,650 1,510,000 – 4,112,739 6,600,389 Completed properties for sale Residential/Serviced apartment 10,817 – – – – 50,611 10,817 61,428 10,817 – – – – 50,611 10,817 61,428 Property developments for sale Retail 15,199 – – – – – 15,199 15,199 Residential/Mixed-use 795,266 159,576 – – 1,073,000 1,683,168 1,868,266 3,711,010 810,465 159,576 – – 1,073,000 1,683,168 1,883,465 3,726,209 12,769,522 1,557,797 8,026,842 6,872,861 3,079,508 1,992,529 23,875,872 34,299,059 * One Brickell City Centre is currently under planning. The site is included under “Properties held for development” in the financial statements. Notes: 1. All properties held through subsidiary companies are wholly-owned except for Island Place (60% owned), Chai Wan Inland Lot No. 178 (80% owned), Taikoo Hui, Guangzhou (97% owned), Taikoo Li Xi’an (70% owned) and Brickell City Centre (Retail: 62.93% owned). The above summary table includes the floor areas of these five properties in 100%. 2. “Other companies” comprise joint venture, associated companies and financial assets at fair value through profit or loss. The floor areas of properties held through such companies are shown on an attributable basis. 3. Gross floor areas in Hong Kong and the Chinese Mainland exclude car parking spaces; there are about 9,840 completed car parking spaces in Hong Kong and the Chinese Mainland, which are held by subsidiaries and other companies for investment. 4. When a Hong Kong property is held under a renewable lease, the expiry date of the renewal period is shown. 5. All properties in the U.S.A. are freehold. 6. Gross floor areas for all properties in the U.S.A. represent saleable or leasable areas for completed and nearly completed properties, which exclude car parking spaces; there are about 1,976 completed car parking spaces held by subsidiaries and other companies for investment. 204

Completed properties for Leasehold Site area in Gross floor area Number of Year of investment in Hong Kong Lot number expiry square feet in square feet car parks completion Remarks Office 1. Pacific Place, 88 Queensway, Central One Pacific Place IL 8571 (part) 2135 115,066 863,266 – 1988 (part) Two Pacific Place IL 8582 & Ext. (part) 2047 203,223 695,510 – 1990 (part) 2. Three Pacific Place, IL 47A sA RP 2050-2852 40,236 627,657 111 2004/07 Linked to The Mall One Queen’s IL 47A sB RP at Pacific Place and Road East IL 47A sC RP Admiralty MTR station. IL 47B sC RP IL 47A RP IL 47C sA ss1 RP IL 47C sA RP IL 47B sA RP IL 47B sB RP IL 47B RP IL 47A sB ss2 IL 47A sD IL 47B sD IL 47C RP IL 47D RP IL 47D sA RP IL 47 sA ss1 IL 47 sA RP IL 47 sB ss1 & RP IL 47 sC ss1 & ss2 sA & ss2 RP & ss3 sA & ss3 RP & ss4 & ss5 & ss6 sA & ss6 RP & ss7 RP & RP IL 47 sP IL 47 RP IL 47 sC ss5 Ext. IL 47 sC ss1 Ext. 3. Devon House, QBML 1 sE ss2 (part) 2881 70,414 803,452 311 1993 Linked to Dorset House Taikoo Place QBML 1 sF ss1 (part) (part) and Cambridge House. QBML 1 sF RP (part) ML 703 sN (part) 4. Dorset House, QBML 1 sQ (part) 2881 238,582 609,540 215 1994 Linked to Devon House Taikoo Place QBML 1 sR ss1 (part) (part) and PCCW Tower. QBML 1 sR RP (part) QBML 1 sS (part) QBML 1 sT ss1 (part) QBML 1 sT ss2 (part) QBML 1 sT RP (part) QBML 1 sU (part) QBML 1 sW (part) QBML 1 RP (part) 5. Lincoln House, QBML 1 sQ (part) 2881 238,582 333,529 164 1998 Linked to PCCW Tower Taikoo Place QBML 1 sR ss1 (part) (part) and One Taikoo Place. QBML 1 sR RP (part) QBML 1 sS (part) QBML 1 sT ss1 (part) QBML 1 sT ss2 (part) QBML 1 sT RP (part) QBML 1 sU (part) QBML 1 sW (part) QBML 1 RP (part) 6. Oxford House, QBML 1 sC ss4 2881/2899 33,434 501,253 182 1999 Linked to One Taikoo Taikoo Place QBML 1 sC ss7 (part) Place. QBML 2 & Ext. sD SWIRE PROPERTIES ANNUAL REPORT 2022 205

SCHEDULE OF PRINCIPAL GROUP PROPERTIES At 31st December 2022 Completed properties for Leasehold Site area in Gross floor area Number of Year of investment in Hong Kong Lot number expiry square feet in square feet car parks completion Remarks Office (continued) 7. Cambridge House, QBML 1 sE ss2 (part) 2881 70,414 268,795 – 2003 Linked to Devon House. Taikoo Place QBML 1 sF ss1 (part) (part) QBML 1 sF RP (part) ML 703 sN (part) 8. One Island East, QBML 1 sC ss5 2881/2899 109,929 1,537,011 – 2008 Taikoo Place QBML 1 sC ss6 QBML 2 & Ext. sF QBML 2 & Ext. sG QBML 2 & Ext. sH ss6 sB RP QBML 2 & Ext. sH RP QBML 2 & Ext. RP QBIL 15 sD 9. One Taikoo Place, QBML 1 sQ (part) 2881 238,582 1,013,368 82 2018 Linked to Lincoln House and Taikoo Place QBML 1 sR ss1 (part) (part) Oxford House. QBML 1 sR RP (part) QBML 1 sS (part) QBML 1 sT ss1 (part) QBML 1 sT ss2 (part) QBML 1 sT RP (part) QBML 1 sU (part) QBML 1 sW (part) QBML 1 RP (part) 10. Two Taikoo Place, QBML 1 sQ (part) 2881 238,582 994,545 346 2022 Linked to PCCW Tower. Taikoo Place QBML 1 sR ss1 (part) (part) QBML 1 sR RP (part) QBML 1 sS (part) QBML 1 sT ss1 (part) QBML 1 sT ss2 (part) QBML 1 sT RP (part) QBML 1 sU (part) QBML 1 sW (part) QBML 1 RP (part) 11. SPACES. 8QRE, IL 5250 2089/ 4,612 81,346 – 2013 With ground floor retail. 8 Queen’s IL 7948 2103/2113 (Refurbishment) Road East, IL 7950 Wan Chai 12. 28 Hennessy Road ML 23 2843 9,622 145,390 – 2012 (will be renamed as IL 2244 RP Five Pacific Place), IL 2245 RP Wan Chai Total held through subsidiaries 8,474,662 1,411 13. PCCW Tower, QBML 1 sQ (part) 2881 238,582 620,148 217 1994 Linked to Dorset House, Lincoln Taikoo Place QBML 1 sR ss1 (part) (part) House and Two Taikoo Place. QBML 1 sR RP (part) Floor area shown represents QBML 1 sS (part) the whole development, in QBML 1 sT ss1 (part) which the Group owns a 50% QBML 1 sT ss2 (part) interest. QBML 1 sT RP (part) QBML 1 sU (part) QBML 1 sW (part) QBML 1 RP (part) 14. Berkshire House, IL 8854 2047 25,926 388,838 84 1998 Floor area shown represents Taikoo Place the whole development, in which the Group owns a 50% interest. 15. One Citygate, TCTL 2 (part) 2047 358,557 160,522 63 1999/ Above Citygate Outlets. Floor Tung Chung, (part) 2000 area shown represents the Lantau whole of the office area of the development, in which the Group owns a 26.67% interest. 16. South Island Place, AIL 461 RP 2064 25,260 382,499 137 2018 Floor area shown represents Wong Chuk Hang the whole development, in which the Group owns a 50% interest. Total held through joint venture companies 1,552,007 501 – of which attributable to the Group 738,548 206

Completed properties for Leasehold Site area in Gross floor area Number of Year of investment in Hong Kong Lot number expiry square feet in square feet car parks completion Remarks Retail 1. Pacific Place, 88 Queensway, Central The Mall at IL 8571 (part) 2135/2047 318,289 711,182 426 1988/90 Shopping centre with Pacific Place IL 8582 & Ext. (part) (part) restaurants and a cinema. Access to Admiralty MTR station. Pacific Place also comprises serviced apartments and hotels, details of which are given in the Residential and Hotel categories below. 2. Cityplaza, QBML 2 & Ext. sK ss5 (part) 2899 334,475 1,096,898 845 1983/87/ Shopping centre with Taikoo Shing QBML 2 & Ext. sR RP (part) (part) 97/2000 restaurants, ice-skating QBML 2 & Ext. sR ss1 sA (part) rink, cinema and access QBML 2 & Ext. sR ss2 (part) to Tai Koo MTR station. QBML 2 & Ext. sQ RP (part) QBML 2 & Ext. sQ ss7 sA (part) QBML 2 & Ext. sQ ss7 RP (part) QBML 2 & Ext. sQ ss2 sB (part) QBML 2 & Ext. sQ ss2 sA ss1 (part) QBML 2 & Ext. sQ ss2 sA RP (part) QBML 2 & Ext. sJ RP (part) 3. Commercial areas SML 1 sA ss1, SML 1 sA RP 2081/ – 329,810 2,182 1977-85 Neighbourhood shops, in Stages I - X of SML 1 sB, SML 2 sC RP 2889/2899 schools and car parking Taikoo Shing SML 2 sC ss2 spaces. SML 2 sD, SML 2 RP QBML 2 & Ext. sJ ss1 QBML 2 & Ext. sJ ss3 QBML 2 & Ext. sL QBML 2 & Ext. sN QBML 2 & Ext. sQ ss4 & ss5 QBML 2 & Ext. sQ ss2 sC QBML 2 & Ext. sS ss1 QBML 2 & Ext. sH ss1 QBML 2 & Ext. sH ss3 sA QBML 2 & Ext. sK ss3 sA QBML 2 & Ext. sU ss1 QBML 2 & Ext. sK ss3 RP QBML 2 & Ext. sK ss4 sA & RP QBML 2 & Ext. sT ss1 & RP QBML 2 & Ext. sU RP QBML 2 & Ext. sK ss9 & ss10 & ss11 & ss13 & ss16 (part) 4. Island Place, IL 8849 (part) 2047 106,498 150,223 288 1996 Floor area shown 500 King’s Road, (part) represents the whole North Point shopping centre podium, in which the Group owns a 60% interest. 5. StarCrest, IL 8853 (part) 2047 40,871 13,112 83 1999 Floor area shown 9 Star Street, (part) represents the whole of Wan Chai the retail podium. 6. EAST Residences, ML 703 sI (part) 2881 8,664 12,312 – 2014 Floor area shown 23 Tong Chong (part) represents the whole of a Street, Taikoo Place 3-storey retail podium (excluding serviced- suites above). 7. STAR STUDIOS I & II, IL 47 sF (part) 2056/2852 6,775 5,197 – 2016 Floor area shown 8-10 & 18 Wing IL 47 sG (part) (part) (Refurbishment) represents the retail area Fung Street, IL 47 sH (part) (excluding residential Wan Chai IL 47 sI (part) apartments). IL 8464 (part) SWIRE PROPERTIES ANNUAL REPORT 2022 207

SCHEDULE OF PRINCIPAL GROUP PROPERTIES At 31st December 2022 Completed properties for Leasehold Site area in Gross floor area Number of Year of investment in Hong Kong Lot number expiry square feet in square feet car parks completion Remarks Retail (continued) 8. EIGHT STAR STREET, IL 526 sA ss1 sC 2856 3,609 2,851 – 2022 Floor area shown Wan Chai IL 526 sA ss1 sB ss1 (part) represent the whole of IL 526 sA ss1 sB RP the retail podium. IL 526 sA ss2 IL 526 sA ss3 IL 526 sA RP Total held through subsidiaries 2,321,585 3,824 9. Tung Chung TCTL 1 (part) 2047 331,658 36,053 75 1998/ Floor area shown Crescent, (part) 1999 represents the retail space, Tung Chung, in which the Group owns a Lantau 26.67% interest. 10. Citygate Outlets, TCTL 2 (part) 2047/ 466,476 803,582 1,197 1999/ Floor area shown Tung Chung, TCTL 11 (part) 2063 (part) 2000/ represents the whole of Lantau 2019 the retail area of the development, in which the Group owns a 26.67% interest. Total held through joint venture companies 839,635 1,272 – of which attributable to the Group 223,903 Residential 1. Pacific Place IL 8582 & Ext. (part) 2047 203,223 443,075 – 1990 270 serviced suites within Apartments, (part) the Conrad Hong Kong 88 Queensway, Hotel tower. Central 2. EAST Residences, ML 703 sI (part) 2881 8,664 62,756 – 2014 106 serviced suites above 23 Tong Chong Street, (part) a 3-storey retail podium. Taikoo Place Floor area shown excludes retail portion. 3. STAR STUDIOS I & II, IL 47 sF (part) 2056/2852 6,775 47,076 – 2016 120 apartments above 8-10 & 18 Wing IL 47 sG (part) (part) (Refurbishment) ground floor shops. Fung Street, IL 47 sH (part) Floor area shown Wan Chai IL 47 sI (part) excludes retail area IL 8464 (part) (5,197 square feet). 4. House B, RBL 507 & Ext. (part) 2097 20,733 2,644 – 1980 One detached house. 36 Island Road, (part) Deep Water Bay Total held through subsidiaries 555,551 – Hotel 1. EAST Hong Kong, QBML 2 & Ext. sR RP (part) 2899 146,184 199,633 – 2009 331-room hotel. Taikoo Shing QBML 2 & Ext. sR ss1 sA (part) (part) QBML 2 & Ext. sR ss2 (part) QBML 2 & Ext. sQ RP (part) QBML 2 & Ext. sQ ss7 sA (part) QBML 2 & Ext. sQ ss7 RP (part) QBML 2 & Ext. sQ ss2 sB (part) QBML 2 & Ext. sQ ss2 sA ss1 (part) QBML 2 & Ext. sQ ss2 sA RP (part) QBML 2 & Ext. sJ RP (part) 2. The Upper House, IL 8571 (part) 2135 115,066 158,738 – 2009 117-room hotel above the Pacific Place (part) (Refurbishment) JW Marriott Hotel. Total held through subsidiaries 358,371 – 3. JW Marriott Hotel, IL 8571 (part) 2135 115,066 525,904 – 1988 608-room hotel, in which Pacific Place (part) the Group owns a 20% interest. 4. Conrad Hong Kong IL 8582 & Ext. (part) 2047 203,223 555,590 – 1990 513-room hotel, in which Hotel, Pacific Place (part) the Group owns a 20% interest. 5. Island Shangri-La IL 8582 & Ext. (part) 2047 203,223 605,728 – 1991 557-room hotel, in which Hotel, Pacific Place (part) the Group owns a 20% interest. Total held through associated companies 1,687,222 – – of which attributable to the Group 337,444 208

Completed properties for Leasehold Site area in Gross floor area Number of Year of investment in Hong Kong Lot number expiry square feet in square feet car parks completion Remarks Hotel (continued) 6. Novotel Citygate TCTL 2 (part) 2047 358,557 236,758 25 2005 440-room hotel, in which Hong Kong, (part) the Group owns a 26.67% Citygate interest. 7. The Silveri TCTL 11 (part) 2063 107,919 131,965 5 2019 206-room hotel, in which Hong Kong – MGallery, (part) the Group owns a 26.67% Citygate interest. Total held through joint venture companies 368,723 30 – of which attributable to the Group 98,326 Completed properties for Leasehold Site area in Gross floor area Number of Year of investment in the Chinese Mainland Address expiry square feet in square feet car parks completion Remarks Retail 1. Taikoo Li Sanlitun 19 Sanlitun Road, 2044 566,332 776,909 417 2007 Shopping centre with (Taikoo Li Sanlitun South) Chaoyang district, Beijing (2054 for (part) restaurants and cinema. car parks) 2. Taikoo Li Sanlitun 11 Sanlitun Road, 2044 566,332 519,399 340 2007 Shopping centre with (Taikoo Li Sanlitun North) Chaoyang district, Beijing (2054 for (part) restaurants. car parks) 3. Taikoo Li Sanlitun 58 Gongti North Road, 2033 40,102 293,405 50 2021 Shopping centre with (Taikoo Li Sanlitun West) Chaoyang district, Beijing restaurants leased by the Group. 4. Building 15 15 Sanlitun North, 2048 4,861 19,747 – 2000s Commercial building Chaoyang district, Beijing acquired by the Group. 5. The Red Building 15A, 2027 7,641 10,077 – 2000s Shopping centre leased by Sanlitun North, the Group. Chaoyang district, Beijing 6. Hui Fang 75 Tianhe East Road, 2044 174,377 90,847 100 2008 Shopping centre with Tianhe district, (part) restaurants. Guangzhou 7. Taikoo Hui 381-389 Tianhe Road 2051 526,941 1,529,392 718 2011 Shopping centre with (odd numbers), Tianhe (part) restaurants. Floor area district, Guangzhou shown represents the retail portion, in which the Group owns a 97% interest. Total held through subsidiaries 3,239,776 1,625 8. INDIGO 18 Jiuxianqiao Road, 2044 631,072 946,769 617 2012 Shopping centre with Chaoyang district, Beijing (2054 for (part) restaurants and cinema. car parks) Floor area shown represents the retail portion, in which the Group owns a 50% interest. 9. Sino-Ocean Taikoo Li Daci Temple Area, 2051 814,604 1,314,237 1,051 2014 Shopping centre with Chengdu 9 Dongda Street, (part) restaurants and cinema. Jinjiang district, Chengdu Floor area shown represents the retail portion, in which the Group owns a 65% interest. 10. Heritage Buildings Daci Temple Area, 2034 N/A 40,387 – 2014 Heritage Buildings leased in Sino-Ocean 9 Dongda Street, (part) from the local government Taikoo Li Chengdu Jinjiang district, Chengdu as part of the retail operation of Sino-Ocean Taikoo Li Chengdu, in which the Group owns a 65% interest. 11. HKRI Taikoo Hui South of West Nanjing 2049 676,091 1,105,646 240 2016 Floor area shown Road and east of Shi Men (part) represents the retail Yi Road, Jing’an district, portion, in which the Group Shanghai owns a 50% interest. SWIRE PROPERTIES ANNUAL REPORT 2022 209

SCHEDULE OF PRINCIPAL GROUP PROPERTIES At 31st December 2022 Completed properties for Leasehold Site area in Gross floor area Number of Year of investment in the Chinese Mainland Address expiry square feet in square feet car parks completion Remarks Retail (continued) 12. Metrolink in South of West Nanjing 2028 N/A 67,813 – 2018 Shopping corridor leased HKRI Taikoo Hui Road and underneath (part) from Shanghai Shentong Shi Men Yi Road, Jing’an Metro and operated by district, Shanghai HKRI Taikoo Hui, in which the Group owns a 50% interest. 13. Taikoo Li Qiantan East of Yangsi West Road, 2053 638,125 1,188,727 907 2020 The Group owns a 50% West of Dongyu Road, interest. North of Haiyang West Road, Pudong New district, Shanghai Total held through joint venture companies 4,663,579 2,815 – of which attributable to the Group 2,534,983 Office 1. Taikoo Hui North of Tianhe Road and 2051 526,941 1,693,125 – 2011 Floor area shown Towers 1 & 2 west of Tianhe East Road, (part) represents the office Tianhe district, Guangzhou portion, in which the Group owns a 97% interest. Total held through subsidiaries 1,693,125 – 2. ONE INDIGO 20 Jiuxianqiao Road, 2054 631,072 589,071 390 2011 Floor area shown Chaoyang district, Beijing (part) represents the office portion, in which the Group owns a 50% interest. 3. HKRI Centre 1 and South of West Nanjing 2059 676,091 1,828,060 798 2016 Floor area shown HKRI Centre 2 Road and east of (part) represents the office Shi Men Yi Road, Jing’an portion, in which the Group district, Shanghai owns a 50% interest. Total held through joint venture companies 2,417,131 1,188 – of which attributable to the Group 1,208,566 Hotel 1. The Opposite House 11 Sanlitun Road, 2044 566,332 169,463 32 2007 99-room hotel. Chaoyang district, Beijing (2054 for (part) car parks) 2. Mandarin Oriental, North of Tianhe Road and 2051 526,941 Hotel: – 2012 263-room hotel and 24 Guangzhou west of Tianhe East Road, (part) 509,434 serviced apartments, in Tianhe district, Guangzhou Serviced – which the Group owns a apartment: 97% interest. 50,376 559,810 Total held through subsidiaries 729,273 32 3. EAST Beijing 22 Jiuxianqiao Road, 2044 631,072 358,301 240 2012 369-room hotel, in which Chaoyang district, Beijing (2054 for (part) the Group owns a 50% office and interest. car parks) 4. The Temple House Daci Temple Area, 2051 814,604 Hotel: – 2015 100-room hotel and 42 9 Dongda Street, Jinjiang (part) 193,137 serviced apartments, in district, Chengdu Serviced – which the Group owns a apartment: 65% interest. 106,804 299,941 210

Completed properties for Leasehold Site area in Gross floor area Number of Year of investment in the Chinese Mainland Address expiry square feet in square feet car parks completion Remarks Hotel (continued) 5. The Sukhothai Shanghai 380 Weihai Road, 2049 676,091 Hotel: 79 2018 201-room hotel, in which the Hotel Jing’an district, (part) 246,646 Group owns a 50% interest. Shanghai The Middle House 366 Shi Men Yi Road, Hotel: 43 2018 111-room hotel, in which the Jing’an district, 141,181 Group owns a 50% interest. Shanghai The Middle House 366 Shi Men Yi Road, Serviced 40 2018 102 serviced apartments, in Residences Jing’an district, apartment: which the Group owns a 50% Shanghai 147,273 interest. 535,100 Total held through joint venture companies 1,193,342 402 – of which attributable to the Group 641,662 Completed properties for Site area in Gross floor area Number of Year of investment in the United States Address square feet in square feet car parks completion Remarks Retail 1. Brickell City Centre – 701 S Miami Avenue, 380,670 496,508 1,137 2016 Floor area shown represents retail portion Miami, Florida (part) the whole shopping centre, in which the Group owns a 62.93% interest. 2. Car parking spaces for 78 SW 7th Street and 380,670 – 389 2016 The Group owns the 389 Two Brickell City Centre, 788 Brickell Plaza, Miami, Florida (part) car parking spaces of the Three Brickell City Centre, sold properties. EAST Residences and EAST Miami Total held through subsidiaries 496,508 1,526 Hotel 1. Mandarin Oriental, South Brickell Key, 120,233 345,000 600 2000 326-room luxury hotel in Miami Miami, Florida central Miami, in which the Group owns a 75% interest. Total held through joint venture companies 345,000 600 – of which attributable to the Group 258,750 Gross floor Expected Property developments for Leasehold Site area in area in Number of Stage of completion investment in Hong Kong Lot number expiry square feet square feet car parks completion date Remarks Residential 1. Rocky Bank, RBL 613 RP 2099 28,197 14,768 – Site formation 2024 Floor area shown is an 6 Deep Water Bay and foundation approximation. Road in progress Total held through subsidiaries 14,768 – SWIRE PROPERTIES ANNUAL REPORT 2022 211

SCHEDULE OF PRINCIPAL GROUP PROPERTIES At 31st December 2022 Gross floor Expected Property developments for Leasehold Site area in area in Number of Stage of completion investment in Hong Kong Lot number expiry square feet square feet car parks completion date Remarks Office 1. Six Pacific Place, IL 2242 2843 14,433 223,303 88 Superstructure 2023 Floor area shown is an 46-56 Queen’s Road IL 2244 sA works in progress approximation. East IL 2244 sB IL 2244 sC IL 2245 sA IL 2245 sB IL 2245 sC IL 2245 sD IL 2245 sE IL 2245 sF Total held through subsidiaries 223,303 88 Property developments Expected for investment in the Leasehold Site area in Gross floor area Number of Stage of completion Chinese Mainland Address expiry square feet in square feet car parks completion date Remarks Retail 1. Phase III of the Next to and on the west 2063 2,233,387 Under 2,075 Site handover From late A premium, resort-style, Sanya International of current Phase II of planning: completed, 2024 retail-led development Duty-Free Complex the Sanya International 2,143,440 foundation in the Haitang district of Duty-Free Complex (under design works expected Sanya. The Group owns & further from Q1 2023 a 50% interest. review) Total held through joint venture companies 2,143,440 2,075 – of which attributable to the Group 1,071,720 Under planning 1. Taikoo Li Xi’an The Small Wild Goose 2062 1,290,669 Under To be Under 2025 Retail-led mixed-use Pagoda historical planning: determined planning development comprising and cultural Zone 2,364,668 retail and cultural Beilin District, Xi’an facilities in addition to a hotel, serviced residences and business apartments. The Group owns a 70% interest. Total held through subsidiaries 2,364,668 – 2. INDIGO Phase Two, Next to and on the 2060 for 842,807 Under To be Basement Phase 1: An office-led, mixed-use Beijing east of current INDIGO, retail (part) planning: determined structure 2025 extension of the Beijing and hotel, 4,045,514 works Phase 2: existing INDIGO project 2070 for are in 2026 comprising a shopping office progress mall, office towers, and a hotel. The Group owns a 35% interest. Total held through joint venture companies 4,045,514 – – of which attributable to the Group 1,415,930 Property developments for Gross floor area Number of Expected investment in the United States Site area in square feet in square feet car parks completion date Remarks Under planning 1. One Brickell City Centre, 123,347 Under planning: To be To be One Brickell City Centre is being planned as Miami, Florida 1,510,000 determined determined a future mixed-use development comprised of retail and Grade A office space. Area shown is in lettable area. Total held through subsidiaries 1,510,000 – 212

Completed properties for sale Site area in Gross floor area Number of Year of in Vietnam Address square feet in square feet car parks completion Remarks Residential 1. The River Thu Thiem, Lot 3.15 165,518 253,054 – 2022 3 residential towers with 525 units, in which the Group effectively owns a 20% interest. GFA excludes 6,886 sqm of parking and 4,500 sqm of retail which is not included in the Group’s investment. As of 31st December 2022, sales of 368 units had been closed. Floor area shown represents the GFA of the remaining 157 residential units. Total held through associated companies 253,054 – – of which attributable to the Group 50,611 Completed properties for sale Site area in Gross floor area Number of Year of in the Hong Kong Address square feet in square feet car parks completion Remarks Residential 1. EIGHT STAR STREET 8 Star Street, 3,609 10,817 – 2022 Residential block comprising Wan Chai (part) 37 units over retail podium. As of 31st December 2022, sales of 27 units had been closed. Floor area shown represents the GFA of remaining 10 residential units. Total held through subsidiaries 10,817 – Property developments Site area in Gross floor area Number of Expected for sale in Hong Kong Lot number Leasehold expiry square feet in square feet car parks completion date Remarks Residential 1. 269 Queen’s Road IL 9061 2072 13,203 102,990 To be 2025 Residential block over retail East (part) determined podium. Floor area shown represents the residential portion of the development. 2. Chai Wan Inland CWIL 178 2071 96,876 692,276 To be 2025 The residential portion of Lot No. 178 (part) determined the whole development, in which the Group owns a 80% interest. Total held through subsidiaries 795,266 – 3. Wong Chuk Hang AIL 467 2067 738,199 638,305 To be 2024 Floor area shown Station (part) determined represents the whole Package Four Property Package Four development, Development in which the Group owns a 25% interest. Total held through joint venture companies 638,305 – – of which attributable to the Group 159,576 Retail 1. 269 Queen’s Road IL 9061 2072 13,203 13,197 To be 2025 The retail portion of the East (part) determined whole development. 2. Chai Wan Inland CWIL 178 2071 96,876 2,002 To be 2025 The retail portion of the Lot No. 178 (part) determined whole development, in which the Group owns a 80% interest. Total held through subsidiaries 15,199 – SWIRE PROPERTIES ANNUAL REPORT 2022 213

SCHEDULE OF PRINCIPAL GROUP PROPERTIES At 31st December 2022 Property developments for sale Gross floor area Number of Expected in the United States Site area in square feet in square feet car parks completion date Remarks 1. South Brickell Key, 105,372 Residential: 395 – Development site in central Miami, Florida 550,000 Miami acquired in January 1997 along with Mandarin Oriental site. Plans for condominium tower currently on hold. 2. North Squared, 380,670 Residential: 544 – The development on the North Miami, Florida (part) 523,000 Squared site is currently on hold. Total held through subsidiaries 1,073,000 939 Property developments Site area in Gross floor area Number of Expected for sale in Indonesia Lot number/Address square feet in square feet car parks completion date Remarks 1. Savyavasa, Jalan Wijaya II No.37A 227,982 Residential: 1,079 2024 Residential tower with South Jakarta Kebayoran Baru, South Jakarta 1,122,728 433 units, in which the Group owns a 50% interest. Total held through joint venture companies 1,122,728 1,079 – of which attributable to the Group 561,364 Property developments Site area in Gross floor area Number of Expected for sale in Vietnam Lot number/Address square feet in square feet car parks completion date Remarks 1. Empire City Thu Thiem, (Zone 2b) 1,103,461 Residential/ 4,729 In phases A residential-led mixed-use project Mixed-use: up to 2028 comprising luxury residential 7,131,624 condominiums, an office tower, a hotel, serviced apartments and a retail mall. To be completed in phases up to 2028. The Group effectively owns a 15.73% interest. GFA excludes 172,295 sqm of parking (although this is included in the Group’s investment). Total held through financial assets 7,131,624 4,729 at fair value through profit or loss – of which attributable to the Group 1,121,804 214

GLOSSARY References in this document to Hong Kong are to Ratios Hong Kong SAR. Attributable gross rental income Gross rental income less Profit attributable to amount shared by non-controlling interests plus the Group’s the Company’s shareholders share of gross rental income of joint venture and associated Earnings per share = companies, and adjusted with related rental concession Weighted average number of shares recognised in the consolidated statement of profit or loss. in issue during the year Equity attributable to the Company’s shareholders Equity before non-controlling interests. Return on average Profit attributable to equity attributable to the Company’s shareholders Gross borrowings Total of loans, bonds and overdrafts. the Company’s = Net assets employed Total equity plus net debt. shareholders Average equity during the year attributable to the Company’s Net debt Total borrowings and lease liabilities less short- shareholders term deposits and bank balances. Underlying profit Reported profit adjusted principally for the impact of (i) changes in the fair value of investment Equity attributable to Equity before properties, (ii) deferred tax on investment properties and the Company’s non-controlling interests shareholders = (iii) amortisation of right-of-use assets reported under per share Number of shares in issue investment properties. at the end of the year Recurring underlying profit Underlying profit adjusted for significant credits and charges of a non-recurring nature, Net debt including gains on the sale of interests in investment Gearing ratio = properties. Total equity Operating profit Interest cover = Net finance charges Operating profit Cash interest cover = Total of net finance charges and capitalised interest Dividends paid and declared Dividend payout ratio = Profit attributable to the Company’s shareholders SWIRE PROPERTIES ANNUAL REPORT 2022 215

FINANCIAL CALENDAR AND INFORMATION FOR INVESTORS Financial Calendar 2023 Shares traded ex-dividend 3rd April Annual Report available to shareholders 4th April Share register closed for 2022 second interim dividend entitlement 6th April Payment of 2022 second interim dividend 4th May Share register closed for attending and voting at Annual General Meeting 4th – 9th May Annual General Meeting 9th May Interim results announcement August 2023 first interim dividend payable October Registered Office Investor Relations Swire Properties Limited E-mail: [email protected] 33rd Floor, One Pacific Place 88 Queensway Public Affairs Hong Kong E-mail: [email protected] Registrars Tel: (852) 2844-3888 Fax: (852) 2918-9960 Computershare Hong Kong Investor Services Limited Website: www.swireproperties.com 17M Floor, Hopewell Centre 183 Queen’s Road East Request for Feedback Hong Kong In order that we may improve our reporting, we would be grateful Website: www.computershare.com to receive your comments on our public announcements and disclosures via e-mail to [email protected]. Stock Code Hong Kong Stock Exchange 01972 Auditors PricewaterhouseCoopers Certified Public Accountants and Registered PIE Auditor 22nd Floor, Prince’s Building Central Hong Kong Disclaimer This document may contain certain forward-looking statements that reflect the Company’s beliefs, plans or expectations about the future or future events. These forward-looking statements are based on a number of assumptions, current estimates and projections, and are therefore subject to inherent risks, uncertainties and other factors beyond the Company’s control. The actual results or outcomes of events may differ materially and/or adversely due to a number of factors, including the effects of COVID-19, changes in the economies and industries in which the Group operates (in particular in Hong Kong and the Chinese Mainland), macro-economic and geopolitical uncertainties, changes in the competitive environment, foreign exchange rates, interest rates and commodity prices, and the Group’s ability to identify and manage risks to which it is subject. Nothing contained in these forward-looking statements is, or shall be, relied upon as any assurance or representation as to the future or as a representation or warranty otherwise. Neither the Company nor its directors, officers, employees, agents, affiliates, advisers or representatives assume any responsibility to update these forward-looking statements or to adapt them to future events or developments or to provide supplemental information in relation thereto or to correct any inaccuracies. 216

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