Circular - Lippo Malls Indonesia Retail Trust - Investor Relations

KJPP WR and KJPP RHP were appointed by the Trustee and the Manager,respectively, to value Binjai Supermall. In their respective reports, KJPP WRand KJPP RHP have stated the open market value of Binjai Supermall as at 30June 2012 to be Rp.253.9 billion (S$32.3 million) and Rp.247.0 billion (S$31.4million), respectively. In arriving at the valuations, both KJPP WR and KJPPRHP used the income valuation method, utilising a discounted cash flowanalysis.The basis and assumptions adopted by KJPP WR and KJPP RHP in arriving attheir respective independent valuations of Binjai Supermall are set out in thetable below.Basis and assumptions in arriving at independent valuations for BinjaiSupermallThe basis and assumptions adopted by KJPP WR and KJPP RHP in arriving attheir respective valuations of Pejaten Village are set out in the table below.KJPP WRKJPP RHPEstimated discount ratesusing pre-tax rates thatreflect current marketassessments at the risksspecific to the properties 11.50% 10.36%Rental Growth rates 5.0% 6.0%Cash flow forecasts derivedfrom the most recentfinancial budgets and plansapproved by managementDiscountedcash flow analysisover 6 yearsprojections(5 years holdingperiod) (1)Discountedcash flow analysisover 11 yearsprojections(10 years holdingperiod) (1)Terminal capitalisation rates 10.5% 11.0%Note:(1) The number of projection years for the cashflow forecasts which each valuer deemedappropriate is based on their independent assessment of the numbers of years required forthe properties to reach a high level of income stability, which the valuers had in turndetermined based on their respective professional opinion as to the investment holdingperiods for the properties. The factors which the valuers had taken into account include,among others, the properties’ existing occupancy rates, the time taken for the properties toachieve maximum occupancy levels, the date of commencement of operation of theproperties and potential impact from the on-going asset enhancements activities.(Please see Appendix D of this Circular for the summary valuation reports ofthe Independent Valuers on Binjai Supermall.)3.2. Other Additional Costs of the Proposed Acquisitions3.2.1 Pejaten Village Acquisition FeeLMIR Trust is expected to incur the acquisition fee in relation to Pejaten Village(the “Pejaten Village Acquisition Fee”) of Rp.7.5 billion (or S$1.0 million)(which is equal to 1.0% of the Pejaten Village Purchase Consideration) inconnection with the Pejaten Village Acquisition, which is payable in Units to theManager pursuant to Clause 15.2.1 of the Trust Deed. As the Pejaten Village14