Its fee income grew 3 per cent year on year to S$281 million despite macroeconomic headwinds

 

[SINGAPORE] CapitaLand Investment : 9CI +2.61% (CLI) reported a total revenue of S$496 million for the first quarter ended Mar 31, down 24 per cent from S$650 million in the corresponding period of the year before.

 

In a business update on Wednesday (Apr 30), the real estate investment manager said much of the decline came from the deconsolidation of CapitaLand Ascott Trust (CLAS). In December 2024, CLI sold a 4.9 per cent stake in CLAS for S$162 million to an unrelated party.

 

On a like-for-like basis, revenue remained &ldquo stable&rdquo since that of Q1 2024 would have been S$496 million, after accounting for CLAS&rsquo deconsolidation in both periods. 

 

CLI&rsquo s real estate investment business revenue fell by over 40 per cent to S$242 million in the first quarter, from S$430 million. But this was for similar reasons &ndash on a like-for-like basis, revenue would have decreased by 6 per cent, after adjusting for CLAS&rsquo deconsolidation, said CLI. 

 

The group attributed the 6 per cent decline to the divestment of on-balance sheet assets, including 16 multi-family assets in the US and Ascendas iHub in Suzhou, China. 

 

Meanwhile, fee-income-related business revenue grew 3 per cent to S$281 million in Q1, from S$274 million in the corresponding period the year before. 

 

This was driven by a 2 per cent year-on-year increase in revenue from lodging management, a 4 per cent rise in commercial management, and 3 per cent growth in listed funds management. These were offset by a 4 per cent dip in private funds management. 

 

Overall revenue per available unit (RevPAU) for the quarter rose 5 per cent year on year to S$85, thanks to higher occupancy and average daily rates (ADR). 

 

The biggest jump in RevPAU was recorded in Japan and Korea, where it went up by 14 per cent to S$190 Europe&rsquo s RevPAU likewise rose 14 per cent, to S$176.

 

CLI attributed the decrease in Singapore to an exceptionally strong ADR in Q1 2024, on the back of major concert events there was heightened competition in China&rsquo s central west region, resulting in a fall in rates. 

 

Still, CLI noted that its performance across markets was &ldquo largely stable&rdquo amid a cautious economic outlook. For instance, rental reversions were mostly positive in South-east Asia, India and other markets. Shopper traffic grew 2.4 per cent in Singapore, and 3.1 per cent in China. 

 

Occupancy in South-east Asia ranged from 92 to 100 per cent. This was 80 to 94 per cent in China, 89 per cent in India, and 88 to 96 per cent in other markets. 

 

As at Mar 31, interest coverage ratio stood at 3.6 times and implied interest cost at 4.1 per cent, after adjusting to reflect the reclassification of CLAS as an associate. Average debt maturity was 3.6 years. 

 

Looking ahead, CLI said it will continue to focus on its strategic priorities. 

 

This includes investing in thematics and markets-focused products, such as in logistics and self-storage, living and wellness, private credit and data centres, as well as its first real estate investment trust in China. 

 

It added that it has around S$700 million committed to scale its funds under management, and will continue to optimise its equity base and drive cost rationalisation. For example, it is targeting S$50 million in savings through streamlining and artificial intelligence-driven productivity gains.