Development Update

Tigre de Cristal, Russia

Tigre de Cristal Phase I upgrade has already been completed, pending border reopening to fully utilise the new upgrades. A brand-new Suncity Premium Club, a new authentic hotpot restaurant and a new private club are now ready.

Phase II planning and construction are well underway except minor delays due to COVID-19. When Phase I & II are both running, Tigre de Cristal will triple in its number of rooms, and double in number in its gaming facilities. Together with other integrated resorts in Primorye, they are going to form a gaming cluster known as the Primorye IEZ.

Westside City Project, Philippines

Through investing in the convertible bonds in Suntrust Home Developers, Inc. (“SunTrust”), Summit Ascent has exposure to the Westside City Project in the Philippines.

Construction works are going on at full steam in Westside City Project even though Manila was under lockdown. The construction team on the ground are working around multiple challenges due to the lockdown while they adjust priority to deliver progress. The foundation works have been completed, cranes are now being erected and the focus is to construct the building upwards. Westside City Project is expected to be ready in 2023.

When all phases of Westside City Project are ready, it will consist of:

* Approximately 300 gaming tables

* Over 1,300 electronic gaming machines

* Over 450 five-star hotel rooms

* Approximately 1,000 car park spaces

* Pool club & leisure club etc.

Westside City Project will be integrated with the shopping malls, theatres, restaurants, and shopping streets, etc. to be built by Suncity’s partner Westside/Travellers International Hotel Group Inc. They will also build additional hotel rooms, a shopping mall, a Grand Opera House, restaurants, a theatre district and an additional of approximately 2,000 car park spaces.

Selected Major Awards

Outlook

The COVID-19 pandemic continues to be the most prevalent uncertainty in our business operating environment. While we are being pragmatic in controlling costs across the board, we have been able to crystalise some of the temporary savings into permanent ones by improving efficiencies. We continue to remain cautiously optimistic in the long run for the Group as its long-term fundamentals remain solid and has not been affected by the pandemic.

Under the pandemic, even with zero foreign tourists, Tigre de Cristal was already able to generate a positive EBITDA merely based on local Russian mass and slots businesses, which act as downside protection for the Group. The Group has a strong balance sheet, solid cash and no debt. Unlike some gaming operators which added leverage to their balance sheets during the pandemic, we have never raised any debt to weather this storm. The cash we have on our balance sheet offers us the flexibility to develop for growth while sustaining through the pandemic.

Secondly, the Russian Federation is blessed as it has access to the self-developed vaccines, which means that as vaccination rates in the country continue to be improved, it is less likely that mandatory closure of the integrated resorts will be required again. Therefore, we believe that the worst-case scenario affected by the pandemic has already passed, and as long as the COVID-19 situation remains under control in the Russian Federation, mandatory complete closure is relatively unlikely to happen again.

Thirdly, the hardware for our main growth drivers are ready. The brand-new Suncity Premium Club and the hot pot restaurant are now fully operational in Tigre de Cristal, pending border reopening for full utilisation. In the short run, while our operating expenses can be sustained through continued operations supported by the local mass and slots businesses, growth in premium mass and Suncity Premium business will depend heavily on border policies because of the reliance on tourism in these two segments. As the world continues to fight back the virus with improving vaccination rates, it sets the scene to allow talks of border reopening between countries soon.

In addition, we are excited to observe that international flights are resuming to the Vladivostok International Airport from 2021 onwards from places such as Seoul and Tokyo. Although the number of tourists arriving at Vladivostok via these flights is low due to back-and-forth quarantine requirements, we are confident on the overall long-term appeal of the IEZ Primorye. Together with the recent and would-be openings of new integrated resorts in the IEZ Primorye, the cluster effect can draw tourists and turn the area into a leisure destination on its own. The uncertainty in land-based gaming developments in Japan also poses an opportunity for the IEZ Primorye to fill this gap as it is only a short flight away for Japanese tourists.

Finally, plans for expansion are continuing to move forward. When TdC Phase II is ready in 2023, Tigre de Cristal will triple the number of existing rooms and double the number of gaming equipment. Through the investment in the convertible bonds in the principal amount of PHP5.6 billion with a 6% coupon rate issued by SunTrust (the “SunTrust CB”), the Group is diversifying into the Philippines gaming market.  SunTrust is the sole and exclusive operator and manager of an integrated resort in the Philippines (the “Main Hotel Casino”) expected to commence operations in 2023. Leveraging on Suncity’s successful experience in the gaming industry, we are confident that both TdC Phase II and the Main Hotel Casino in the Philippines will become key growth drivers for the Group when they are both up and running.

About Summit Ascent Holdings Limited (HKEx stock code: 102)

Summit Ascent Holdings Limited (“Summit Ascent“) is a subsidiary of Suncity Group Holdings Limited (“Suncity“, HKEx: 1383). Summit Ascent holds 77.5% in Tigre de Cristal, currently the largest integrated resort located in the Primorye Integrated Entertainment Zone of the Russian Far East. Situated midway from the Vladivostok International Airport to Vladivostok city, the administrative centre of the Russian Far East, Tigre de Cristal is ideally located geographically in the heart of Northeast Asia.

Summit Ascent holds a gaming license granted by the Russian government for an indefinite period, and Tigre de Cristal has opened for business since late 2015, offering a broad range of gaming options on a 24/7 basis. Tigre de Cristal has been certified as a five-star hotel with retail offerings, food and beverage outlets, private club, and named “Russia’s Leading Resort” by World Travel Awards.

Summit Ascent is a member of the MSCI Hong Kong Micro Cap Index. For more information about Summit Ascent, please visit https://www.saholdings.com.hk/eng/

#SummitAscent

Positioning of both cities as regional hubs driven by target business geographies

HONG KONG SAR – Media OutReach– 24 August 2021 – The office rental premium between Hong Kong and Singapore have narrowed markedly between 2015 and 2020, according to Cushman & Wakefield.

“When we compared the office rental premiums between the two cities in 2015 and looked at which city had a more competitive edge as a choice of regional headquarters location, the rental gap was at 135% in favour of Singapore. Five years later, this gap has narrowed to 108%, which creates a positive opportunity for Hong Kong as it becomes more competitive,” said Keith Chan, Head of Research, Hong Kong, Cushman & Wakefield.

“As the two cities continue to attract investors and occupiers, we are seeing a more defined role whereby companies looking for more exposure to China will prefer to have Hong Kong as its regional base while Singapore is a better location for companies looking to grow and capitalize on the emerging South East Asian markets. For example, China’s tech companies including Tencent, Alibaba and ByteDance have set up base in Singapore to tap into the opportunities within SEA,” noted Wong Xian Yang, Head of Research, Singapore, Cushman & Wakefield.

“In Hong Kong, small to medium-sized occupiers in the finance sector such as private equity funds, hedge funds, asset managers, wealth management and crypto currency service providers are expanding their presence to leverage the city’s position as the gateway to Chinese capital,” continued Keith Chan, Head of Research, Hong Kong, Cushman & Wakefield.

Below is a snapshot of the office rental performance of both markets between 2015-2020:

• The rental premium between Hong Kong and Singapore Grade A CBD office rents widened rapidly in 2015 to reach 135% from 71% in 2014 as Hong Kong rents went on an uptrend due to tight supply conditions and strong demand from corporate occupiers especially from Chinese financial firms looking for prime multi-floor space in the CBD.
• On the other hand, Singapore office rents fell in 2015 as the office market was hit by a double whammy of weak global economic growth and a supply glut.
• The gap in rents continued to widen to reach a peak of 173% in 2017, at which point the Singapore market started to recover, driven by a recovering global economy and demand from co-working operators and tech companies.
• The gap then narrowed in 2018, as Singapore market rents rose by 15.3% y-o-y amidst tight vacancies and strong demand while Hong Kong rents rose by a lesser 4.9% y-o-y in USD terms.
• As business sentiment in Hong Kong weakened amidst the protests in the latter half of 2019, the rental gap continued to close over this time period and was further exacerbated by the pandemic which further drove rents down in both cities. As of end 2020, we saw a 108% difference between Singapore and Hong Kong.

Outlook

Singapore
Despite the ongoing pandemic, the Singapore office market is showing signs of recovery with rental growth turning positive in 2Q 2021. This is fueled by a flight to quality with demand for quality office space driven by technology and investment management companies as they leverage the lower rents to secure spaces in trophy buildings. Also, Singapore’s GDP growth is expected to bounce back in 2021 and business confidence remains firm given Singapore’s relatively strong pandemic track record in the region. Furthermore, new office supply has seen strong pre-commitment rates and the pandemic situation has led to delays in building completions fueling a tight supply situation in the Grade A office market. Nonetheless, the recovery in office rents is expected to be mild over the next few years on the back of lower structural demand for office space due to remote working.

However, the expected increase in Singapore office rents reflects the city’s increasing importance as a hub for stability in an uncertain operating environment and the increased significance of the ASEAN market to corporate occupiers. With the successful roll-out of its vaccination programme coupled with a progressive economic recovery plan, the country has maintained its reputation as a safe and stable investment destination and regional business hub.

Hong Kong
Hong Kong rents are still expected to downtrend till 2023, closing the rental gap between cities. The city’s Grade A new office supply adds up to circa. 5 million sf from now to 2023 and when combined with the sizable stock already available in the market will put pressure on the city’s rentals. Landlords in the CBD are more willing to offer competitive incentives in order to retain existing tenants, or to lure potential tenants relocating from other submarkets.

An ongoing rental adjustment will continue to take place until a significant portion of new stock is being absorbed by the market, which will take about 2 to 3 years. These market changes present office tenants with an excellent opportunity to upgrade their office space and as the market stabilizes and reinvigorates itself, Hong Kong will be well-positioned to capitalize on the expected surge in activity when cross-border travel resumes.

From an office occupier perspective, conversations around business and operational strategies as they relate to location and space requirements will continue to gain momentum amidst the evolving pandemic situation and changes in regulatory framework and policies. It is more important now than ever before for corporate occupiers to be aware of the variability in rental trajectories and proactively strategise to capitalise on expected rental declines or minimise rental increases. They should align their real estate strategy to corporate enterprise goals, especially when considering alternative locations. They should also calculate their space requirements accurately through workplace analysis and apply thoughtful design and fit-out standards to help ensure maximum productivity. These strategies will define how they optimise their office space with minimal cost exposures over the course of their lease period, in whichever city they choose to be.

“We believe the outlook for the Hong Kong office market is positive as Hong Kong is in pole position as the regional finance hub in Asia Pacific due to a number of favourable factors such as the ongoing development of the Greater Bay Area, low tax rates, active IPO market and its position as a global offshore RMB centre, providing unparalleled access to Mainland markets,” concluded Keith Hemshall, Executive Director & Head of Office Services, Hong Kong, Cushman & Wakefield.

Hong Kong vs Singapore Grade A Office Rents

Source: Cushman & Wakefield

Note: Rents quoted here refer to the total occupancy costs in USD psf pm, which is net effective rents plus service charge, focusing on Greater Central for Hong Kong and the CBD for Singapore.

About Cushman & Wakefield

Cushman & Wakefield (NYSE: CWK) is a leading global real estate services firm that delivers exceptional value for real estate occupiers and owners. Cushman & Wakefield is among the largest real estate services firms in the world, with approximately 50,000 employees in over 400 offices and 60 countries. In Greater China, a network of 22 offices serves local markets across the region, earning recognition and winning multiple awards for industry-leading performance. The firm had global revenues of $7.8 billion in 2020 across core services including valuation, consulting, project & development services, capital markets, project & occupier services, industrial & logistics, retail and others. To learn more, visit www.cushmanwakefield.com or follow us on LinkedIn (https://www.linkedin.com/company/cushman-&-wakefield-greater-china)

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• New study from Lenovo and Microsoft shows enormous opportunities in e-learning, but limited adoption of full range of solutions
• Challenges such as such as distraction and social isolation still hamper effectiveness of online education
• New subscription models, smarter collaboration platforms, AI-enabled devices, and virtual reality can unlock future potential

HONG KONG SAR – Media OutReach – 24 August 2021 – As schools cross the one-year mark since the rapid shift to virtual classrooms, a new study commissioned by Lenovo and Microsoft has found that both students and educators see enormous potential in online learning, but are just beginning to enjoy its advantages. The biggest barriers to success in online learning have not been a lack of technology access, but low use of available solutions and social challenges stemming from extended periods of remote learning.

Conducted by specialist firms YouGov and Terrapin across 12 markets in Asia Pacific during May 2021, the study examined nearly 3,400 students, parents and educators to understand their assessment of e-learning since the pandemic began, including 218 students in Hong Kong, and explored how technology can further engage students and support learning.

“With schools closed in many countries for the better part of 2020, educators, parents and students alike have grappled with new learning technologies. This study has helped us better understand how educators, parents and students have adapted to online learning during the pandemic, what the real challenges are, and what solutions can be deployed to help make learning technologies more effective,” said Fan Ho, General Manager, Hong Kong and Macau, Lenovo.

“The role of technology has become a much needed lifeline in enabling teaching and learning between students and educators today. Despite the challenges faced over the last year, we admire the resilience and adaptability students and educators have had as classrooms shifted from traditional set-ups to virtual environments. As we move forward, it is clear innovation will continue to transform learning experiences – and we remain committed in supporting the industry with the right tools and solutions so that they are equipped for the new age of education,” said Larry Nelson, Regional General Manager, Education, Microsoft Asia.

Technology in education became the norm during the past year – with mixed results

Across Asia Pacific, more than 80% of students and 95% of educators increased their use of technology during the past year, while 68% of students and 85% of educators spent more money on technology during the past year than they had in the previous year. This trend will continue, with 66% of students and 86% of educators expecting to further increase their spending on learning technology in the coming year.

Educators and students had differing opinions on the impact of online classes on educational performance. Educators were relatively positive about their teaching performance online, with 59% confident that teaching performance had improved, and 24% believing it had been maintained. However, students’ assessment was mixed: around a third of students believed their performance had improved, another third believed it had stayed the same during the period of online learning, and the remaining third believed their learning performance had declined.

Accessibility and convenience are major advantages of online learning

Among students, accessibility (63%) and flexibility (50%) were named as major advantages of online learning, including the ability to access a broad variety of content and materials from all over the world. Additionally, 62% of students and 67% of educators praised the convenience of eliminating the need to commute.

Meanwhile, 64% of educators highlighted the advantages of centralizing the teaching materials in one easily accessible online resource such as Microsoft Teams for Education , along with 50% who commend the fact that e-learning encourages collaborative learning, and allows for more personalised learning and support.

Students and educators know what they want – but are just beginning to leverage existing solutions

Students and their parents said it was “extremely important” that their technology provides security (50%), privacy (52%), flexible performance (26%), and continuous value (29%). Just 17% considered it to be extremely important to have the lowest possible cost for a technology solution.

Educators were also interested in education-specific security (75%) and data privacy (79%), but additionally named collaboration features (64%), student assessment tools (63%), general ease of use (59%), and accessibility features (53%) as extremely important.

However, although 72% of students used a laptop such as a Lenovo Yoga and 29% used a tablet such as a Lenovo IdeaPad to access online learning, few had embraced the full suite of learning solutions: just 38% of students used video conference apps such as Microsoft Teams, only 20% used cloud-based document sharing, and 14% used remote access files. Around 15% of students had access to an online learning management system.

Almost 95% of educators used a laptop such as a Lenovo ThinkPad for their daily teaching. While 76% had used video conference apps, only 56% used cloud-based document sharing, and just 36% used remote access files. Around 66% used an online learning management system. Additionally, 34% had used a virtual reality platform such as Lenovo ThinkReality.

Students and educators find ways to cope with tech support, but distraction, engagement and isolation are barriers

Physical distance did not deter students or teachers from getting the technical support they needed while e-learning; although many school technical support teams were unable to cope with the volatile demand, students and educators found alternative sources of support. Students were more likely (33%) to ask a classmate, friend, or younger household member for help than they were to go to school tech support staff (15%). Similarly, 47% of educators addressed their concerns to the school tech support team, but 32% simply tried to find an answer themselves, 31% asked another teacher, and at least 11% consulted with a nearby teenager.

Around 14% of educators had embraced device-as-a-service (DaaS). DaaS offers a subscription-based model including laptops, desktops, tablets, tech support, software and management services.

Students and educators found the most profound barriers to online learning in the social sphere. More than 60% of students and educators indicated that they experienced weakened social relationships during the period of online learning. The top four factors listed as challenges by students and their parents were distractions at home (54%), less motivation to attend online classes at home (48%), lack of immediate feedback and interaction with teachers/classmates (46%) and social isolation or difficulty in meeting people (41%).

While video conferencing applications provide many avenues for real-time interaction, attending all their classes through a screen proved to be challenging for students. 75% of educators listed “students get distracted or lose concentration during live sessions” as one of the major barriers to e-learning.

New subscription models, smarter collaboration and devices can unlock potential of online learning

“What we see from this study is that there can be enormous benefits from education technologies, but students and educators have yet to embrace its full potential,” continued Amar Babu. “Both students and educators are looking for collaborative, personalized learning – using technologies that can keep them engaged, with the material and with each other. Lenovo is at the forefront of these technologies, with built-in features leveraging Artificial Intelligence, helping create opportunities for online engagement, and providing convenience and reliability.”

Lenovo’s services portfolio supports ongoing learning by bringing end-to-end solutions to schools and universities.

• Lenovo Managed Services equips all devices with cybersecurity software and secure collaboration tools that ensure data protection and student safety
• Lenovo Device as a Service (DaaS) ensures comprehensive technical management, helpdesk, and support for students and educators on and off campus
• Lenovo Hybrid Classroom solutions create more dynamic learning environments with all-in-one smart collaboration systems like the ThinkSmart Hub, making it easy for students and educators to connect, share, and learn remotely.
• VR devices and solutions such as ThinkReality and Lenovo VR Classroom 2 allow educators to further engage and inspire students through virtual reality lessons that enhance students’ understanding of subject matter

As the world adjusts to a new normal, education is entering a new age of teaching and learning. Advanced technologies are paving the way for students to experience immersive learning with real-world applications, and empowering educators to help students continue learning through new and different methods, wherever they may be.  

About the Study

Conducted in May 2021, the research surveyed 783 educators in Asia Pacific, along with 669 parents and 1,935 students aged 16 to 25 above about their experience with e-learning during the global pandemic. Respondents surveyed were from Australia, New Zealand, Malaysia, Thailand, Taiwan, Singapore, Hong Kong, Vietnam, Philippines, Korea, India, and Japan.

About Lenovo

Lenovo (HKSE: 992) (ADR: LNVGY) is a US$60 billion revenue Fortune Global 500 company serving customers in 180 markets around the world. Focused on a bold vision to deliver smarter technology for all, we are developing world-changing technologies that power (through devices and infrastructure) and empower (through solutions, services and software) millions of customers every day and together create a more inclusive, trustworthy and sustainable digital society for everyone, everywhere. To find out more visit https://www.lenovo.com and read about the latest news via our StoryHub.

About Microsoft

Microsoft (Nasdaq “MSFT” @microsoft) enables digital transformation for the era of an intelligent cloud and an intelligent edge. Its mission is to empower every person and every organization on the planet to achieve more.

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