Chief Executive’s Statement Our Future Prospects Looking at the office sector in Hong Kong, we expect it to remain weak for the balance of 2023, with increased The outlook for our retail business in Hong Kong remains vacancy rates, new supply, and an uncertain positive, given the strong recovery over the past six macro-economic outlook. In spite of the current months. The increase in inbound tourism as well as an challenges, the performance of our office portfolio has improvement in consumer confidence has bolstered our remained resilient, and we are making very good progress business, and we are seeing healthy footfall and sales with the transformation of Taikoo Place, which is nearing across our Hong Kong malls. As we look ahead, we are the latest phase of its redevelopment. Two Taikoo Place planning to improve our tenant mix and upgrade our is 56% committed, with 17 floors now handed over. amenities. We will strengthen connections with our Taikoo Garden has been officially opened, and customers, through our popular loyalty programmes, and anticipation is high for other new features, including the we will continue to collaborate with world-class partners remaining 70,000 square feet of green open space which to curate experiential campaigns for customers. will promote Hong Kong’s biodiversity, as well as our connecting walkways and new outdoor dining amenities. In the Chinese Mainland, we are seeing strong demand from major international brands to expand their presence Six Pacific Place is also making good progress. Together in the region. Our Taikoo Li and Taikoo Hui brands remain with Five Pacific Place, we are confident that these best-in-class, and we are focused on collaborating with projects will strengthen our flagship Pacific Place brand our partners to curate innovative retail experiences in in Admiralty. our malls. We will continue to focus our efforts on Taikoo Place and The Chinese Mainland remains a core market for our Pacific Place where our fundamentals remain strong, future growth, and we are optimistic about the future, thanks to our investment in digital transformation, solid with plans to double our GFA in the region under our ESG credentials and excellent amenity provisions which HK$100 billion investment plan. We will continue to appeal to a diverse tenant base. invest in tier-one cities such as Beijing, Shanghai and Guangzhou, and we are excited to be testing new waters On the residential front, we are making headway with an in new markets such as Xi’an and Sanya, where we have ambitious pipeline of six projects under development in two new large-scale retail projects under development. Hong Kong and South East Asia. Sales at EIGHT STAR Following our acquisition of the remaining 50% equity STREET in Hong Kong continue to perform well, interest in Sino-Ocean Taikoo Li Chengdu, we are also complementing our wider Pacific Place portfolio. In Wong exploring retail-led opportunities in Guangzhou, Shanghai Chuk Hang, our joint venture project was officially named and Shenzhen. “LA MONTAGNE” and has been launched for sale. There is more in the pipeline for Hong Kong, including our joint venture project in Chai Wan which is under construction and our latest project at 269 Queen’s Road East, which will strengthen our presence in the Wan Chai area. 14 Swire Properties Limited Interim Report 2023