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CapitaLand Integrated Commercial Trust raising S$600 million in private placement
The units are priced at S$2.11 apiece
[SINGAPORE] CapitaLand Integrated Commercial Trust : C38U +0.45% (CICT) on Wednesday (Aug 6) announced the launch of nearly 284.4 million new units to raise gross proceeds of around S$600 million, priced at S$2.11 apiece.
The issue price represents a discount of around 2.5 per cent to the adjusted volume-weighted average price (VWAP) of S$2.1637 per unit for trades done on Monday.
It also represents an approximate 5.5 per cent discount to the VWAP of S$2.2334 per unit, said the manager.
The private placement was about 4.9 times covered, when including the upsize option, and around 5.9 times covered, upon excluding the upsize option.
The joint bookrunners and underwriters agreed to raise additional gross proceeds of around S$100 million for the issue, such that the aggregate gross proceeds raised is about S$600 million as part of the upsize option.
Around S$125.9 million or 21 per cent of the amount will be used to repay and refinance debt and/or capital expenditure and asset enhancement initiatives. This is up from the S$26.3 million CICT announced on Tuesday.
Some S$7.6 million of the sum will also be allocated for the payment of transaction-related expenses, including professional fees and expenses related to the private placement. This is an increase from the S$7.2 million stated previously.
The S$466.5 million designated on Tuesday to finance the remaining 55 per cent interest in the office and retail component of CapitaSpring, located at 86 and 88 Market Street, remains the same.
Earlier on Tuesday, CICT&rsquo s manager provided a range of the issue price to be between S$2.105 and S$2.142 per new unit, and estimated gross proceeds of S$500 million to be raised.
DBS has been allocated 3.3 million new units under the private placement, and is a joint bookrunner and underwriter, along with Citigroup Global Markers Singapore and JPMorgan Securities Asia. According to the Singapore Exchange, no objections arise as long as the amount placed to DBS is no more than 25 per cent of the total new units under the private placement, and DBS does not own an interest of 5 per cent or more in CICT.
The trading of the new units is expected to commence at 9 am on Aug 14.
Analysts generally positive on CICT post-H1 results limited upside prevails
JPMorgan analysts Mervin Song and Terence Khi are &ldquo overweight&rdquo on the counter following robust first-half FY2025 results.
CICT&rsquo s distribution per unit (DPU) had increased by 3.5 per cent to a new high of S$0.0562 supported by its distributable income up 12.4 per cent year on year to S$411.9 million, from S$366.5 million, on the back of income contribution from Ion Orchard acquired in October 2024, improved performance from existing properties and lower interest expenses.
&ldquo This was underpinned by H1 retail rental reversions increasing by 7.7 per cent with the office portfolio seeing a 4.8 per cent uplift. Cost of debt quarter on quarter was also stable at 3.4 per cent,&rdquo they wrote on Tuesday.
They noted that CICT&rsquo s tenant sales in H1 remained resilient with downtown malls excluding Orchard up 0.3 per cent (or 40 per cent if Ion Orchard was included), while that of suburban malls slipped 0.4 per cent year on year mainly due to asset enhancement initiatives at IMM. Overall portfolio occupancy dipped slightly to 96.3 per cent from 96.4 per cent in Q1.
With regards to the Reit&rsquo s private placement, the JPMorgan analysts&rsquo evaluation based on Tuesday&rsquo s range of S$2.105 to 2.142 per unit translated to an FY2025 DPU of S$0.1114 to S$0.1156, with the mid-point of S$0.1135 in-line with their FY2025 DPU expectations, but 3 per cent above consensus.
The current upsized option of S$600 million in gross proceeds also sees the Reit&rsquo s DPU accretion of 0.9 per cent instead of 1.1 per cent, with gearing lowered to 37.9 per cent from 38.3 per cent.
Equity research analysts Hesper He and Xuan Tan from Goldman Sachs had earlier noted in their Tuesday report CICT&rsquo s &ldquo broadly unchanged&rdquo gearing and previous DPU accretion level, following the announcement of CICT acquiring the remaining 55 per cent stake in CapitaSpring for S$1 billion.
Still, CapitaSpring &ndash a Grade A office tower located in Raffles Place &ndash is a &ldquo high-quality asset&rdquo to the analysts, as it increases CICT&rsquo s Singapore exposure to 95 per cent from 94 per cent.
They added that upside could be relatively more limited however given its high occupancy of 99.9 per cent and expiring rents at S$12.99 per square foot (psf) a month for 2026 and 12.47 psf a month for 2027. The analysts have kept their &ldquo neutral&rdquo call on CICT, with no change to its target price of S$2.18.
lunch in cbd. the ususal now again waiting for a seat. that is how much the activities in cbd has returned. yes this reits which owns quite a few cbd offices and retails has not reflected in the reits price.
with inflation food shop are charging higher price. soon landlord will charge more for rental to recover the susbsidies made during the covid-19 months. how much will the reits dividend recover from rental increased after paying for higher interest cost?
with inflation food shop are charging higher price. soon landlord will charge more for rental to recover the susbsidies made during the covid-19 months. how much will the reits dividend recover from rental increased after paying for higher interest cost?
CICT unit issues HK$755 million fixed rate notes due 2033 priced at 4.85%
CAPITALAND Integrated Commercial Trust&rsquo s (CICT) wholly-owned subsidiary CMT MTN has issued HK$755 million (S$130 million) worth of fixed rate notes to institutional or sophisticated investors.
The notes will mature on Mar 15, 2033, and will bear interest at a rate of 4.85 per cent per annum, payable annually in arrear.
Proceeds from the notes issue will be used to finance or refinance eligible green projects undertaken by CICT and its subsidiaries in accordance with the group&rsquo s green finance framework, the real estate investment trust (Reit) said on Wednesday (Mar 15).
The Singapore Exchange Securities Trading (SGX-ST) has granted approval-in-principle for the listing and quotation of the notes, so the notes will be listed and quoted on the SGX-ST on or about Mar 16, it added.
The notes were issued under the US$3 trillion Euro-Medium Term Note programme which CMT MTN established in 2010, and are unconditionally and irrevocably guaranteed by HSBC Institutional Trust Services, in its capacity as trustee of CICT.
The trustee will also guarantee the issuer&rsquo s obligations as it undertakes transactions to swap the Hong Kong dollar proceeds of the notes into Singapore dollar proceeds of about S$132.7 million at a Singapore dollar fixed interest rate of 4.026 per cent per annum.
Moody&rsquo s Investors Service assigned the notes a senior unsecured rating of A3. This takes into consideration CICT&rsquo s track record of strong access to funding, and has manageable refinancing needs over the next 12 to 15 months due to proactive capital management, Moody&rsquo s said in a note.
The rating also incorporates Moody&rsquo s expectation that CICT&rsquo s earnings will improve over the next 12-18 months because of higher contributions from acquisitions completed last year, it stated.
The ratings agency, meanwhile, gave the notes a &ldquo negative&rdquo outlook, owing to CICT&rsquo s elevated leverage and uncertainty around the trust&rsquo s ability to balance deleveraging with its growth strategy.
Retail S-Reits&rsquo metrics surpass pre-Covid poised to benefit from tourism boost
INTERNATIONAL tourist arrivals to Singapore rose in January to a new post-pandemic high, with over 930,000 visitors. The Singapore Tourism Board expects the nation to receive up to 14 million international visitors this year, more than double the 6.3 million recorded in 2022. Tourism receipts are also expected to grow from around S$14 billion in 2022 to as high as S$21 billion this year.
This may bode well for domestic consumer, leisure and hospitality-related sectors. Listed in Singapore are seven S-Reits that have significant exposure to Singapore-based retail properties.
CapitaLand Integrated Commercial Trust : C38U 0% (CICT) for its FY2022 reported 25 per cent and 22.5 per cent year-on-year (yoy) growths in shopper traffic and tenant sales, respectively.
Downtown malls saw higher growth, with over 30 per cent increases in both shopper traffic and tenant sales. CICT noted that operating metrics in its retail portfolio surpassed pre-pandemic figures on the back of healthy market demand. Retail portfolio occupancy improved to 98.3 per cent as at Dec 31, 2022 (vs 96.8 per cent as at Sep 30, 2022) and positive rent reversion was recorded.
Mapletree Pan Asia Commercial Trust : N2IU +0.58%&rsquo s VivoCity Mall reported that its Q3 FY22/23 sales continued to exceed pre-pandemic levels, with shopper traffic and tenant sales growing 50.5 per cent and 38.5 per cent yoy, respectively. VivoCity recorded positive rent reversion at 7.9 per cent.
Suntec Reit : T82U -0.71% reported 27.3 per cent and 38.8 per cent yoy growth in gross revenue and net property income, respectively, for its retail portfolio in H2 FY22. Growth was driven by higher occupancy, rent and advertising revenue at its Suntec City Mall. Overall retail portfolio committed occupancy improved to 98.1 per cent as at Dec 31, 2022 and the Reit recorded positive rent reversion at 4.4 per cent in FY2022.
Frasers Centrepoint Trust : J69U +0.45% reported that shopper traffic and tenant sales in Q1 FY23 remained robust and grew 38.3 per cent and 13.4 per cent yoy, respectively. Retail portfolio committed occupancy improved to 98.4 per cent as at Dec 31, 2022 on healthy leasing demand.
Paragon Reit : SK6U -0.52%&rsquo s Paragon Mall saw sales recover to above pre-Covid levels as tenant sales for the January to December 2022 period increased 45 per cent yoy. Footfall was around 80 per cent of pre-Covid levels. The Clementi Mall remained resilient as tenant sales increased 12 per cent across the same period, with footfall gradually trending upwards post relaxation of pandemic restrictions.
Lendlease Global Commercial Reit : JYEU 0%&rsquo s retail portfolio maintained a portfolio occupancy rate of 99.5 per cent as at Dec 31, 2022, with positive rent reversion of around 2 per cent. The Reit noted that tenant sales and visitation in H1 FY23 surpassed pre-Covid levels and was five times and 2.8 times, respectively, what it was in H1 FY22.
Starhill Global Reit : P40U -0.9%&rsquo s Wisma Atria saw tenant sales and shopper traffic improve in H1 FY23 by 32.6 per cent and 30 per cent, respectively, yoy. Overall portfolio occupancy rate of the Reit was at 97.1 per cent as at Dec 31, 2022.
In February, S-Reits posted negative 2 per cent in total returns (based on the iEdge S-Reit Index). Retail investors net bought the sector, totalling S$89 million in net inflows while institutional investors net sold the sector, at S$42 million in net outflows. SGX RESEARCH
The writer is a research analyst at SGX. For more research and information on Singapore&rsquo s Reit sector, visit sgx.com/research-education/sectors for the monthly S-Reits & Property Trusts Chartbook.
NEWS RELEASE
CICT?s 1H 2022 distributable income up 3.4% to S$347.3 million
▪ Stronger performance due to tailwinds from Singapore?s reopening and
proactive portfolio reconstitution efforts
▪ Embarking on asset enhancement initiative for CQ @ Clarke Quay following
completion of acquisitions of CapitaSky and three Australian assets
Singapore, 28 July 2022 ? CapitaLand Integrated Commercial Trust Management Limited
(CICTML), the manager of CapitaLand Integrated Commercial Trust (CICT or the Trust),
reported today a distributable income of S$347.3 million for the six months ended 30 June
2022 (1H 2022), an increase of 3.4% compared to the S$335.9 million in 1H 2021. 1H 2022
distribution per unit (DPU) was 5.22 cents1
. The record date for 1H 2022 DPU is Friday,
5 August 2022, and Unitholders can expect to receive the DPU on Friday, 9 September 2022......
https://links.sgx.com/1.0.0/corporate-announcements/W8WMY744IBT3QLPZ/725014_News_Release_CICT_1H_2022_Financial_Results_20220728.pdf
CICT?s 1H 2022 distributable income up 3.4% to S$347.3 million
▪ Stronger performance due to tailwinds from Singapore?s reopening and
proactive portfolio reconstitution efforts
▪ Embarking on asset enhancement initiative for CQ @ Clarke Quay following
completion of acquisitions of CapitaSky and three Australian assets
Singapore, 28 July 2022 ? CapitaLand Integrated Commercial Trust Management Limited
(CICTML), the manager of CapitaLand Integrated Commercial Trust (CICT or the Trust),
reported today a distributable income of S$347.3 million for the six months ended 30 June
2022 (1H 2022), an increase of 3.4% compared to the S$335.9 million in 1H 2021. 1H 2022
distribution per unit (DPU) was 5.22 cents1
. The record date for 1H 2022 DPU is Friday,
5 August 2022, and Unitholders can expect to receive the DPU on Friday, 9 September 2022......
https://links.sgx.com/1.0.0/corporate-announcements/W8WMY744IBT3QLPZ/725014_News_Release_CICT_1H_2022_Financial_Results_20220728.pdf
Clarke Quay to undergo S$62m asset enhancement initiativeSINGAPORE&rsquo S heritage landmark Clarke Quay is due for a S$62 million asset enhancement initiative (AEI) to bring about new warehouse facades, refreshed dining areas and spaces, as well as improved infrastructure for thermal comfort.Clarke Quay is owned by CapitaLand Integrated Commercial Trust : C38U +1.9% (CICT) and managed by CapitaLand Investment Limited : 9CI -1.53% (CLI).In a joint press statement on Tuesday (Jul 26), the real estate investment trust (Reit) manager and property giant said Clarke Quay has been rebranded to CQ @ Clarke Quay both locally and internationally &ldquo to reflect its modern interpretation of Clarke Quay&rsquo s rich heritage&rdquo .The landmark will continue to operate throughout the AEI, which is due to be carried out in phases from the third quarter of 2022 to Q3 2023.Pre-commitment from tenants and leases in advanced negotiations have reached over 70 per cent of the development&rsquo s net lettable area, said CICT and CLI, with the new tenant mix to offer a variety of day trade activities and retail offerings.Upon completion of the AEI, the landmark will comprise 3 main zones, namely: The Riverfront (Blocks A and D), The Warehouses (Block B) and The Circuit (Blocks C and E).The Riverfront will feature riverside dining, while The Warehouses will offer a blend of retail lifestyle and F& B (food and beverage) concepts, including an &ldquo all-new brewery concept by an award-winning hospitality group&rdquo , in a conserved warehouse. The Circuit will &ldquo showcase high-energy concepts&rdquo along with entertainment and F& B establishments.Around 34 per cent of the total project cost will be dedicated to introducing green features at CQ @ Clarke Quay. This includes the installation of an energy-efficient omnidirectional fan with evaporative mist cooling, as well as a new ETFE (ethylene tetrafluoroethylene) canopy, which can reduce solar heat gain by up to 70 per cent.Post the AEI, the development is expected to upgrade its BCA (Building and Construction Authority) green building rating to Green Mark Gold Plus, from Green Mark Certification previously.Tony Tan, chief executive of CICT&rsquo s manager, expects the Reit to enjoy sustained property income on a stablised basis, post-pandemic and after the AEI.&ldquo The repositioning of CQ @ Clarke Quay is a timely move that will broaden its appeal to families in tandem with the urban renewal of the Singapore River precinct to incorporate more leisure amenities and residential developments, such as the 696-unit CanningHill Piers sited adjacent to CQ @ Clarke Quay,&rdquo he said.London-headquartered Atelier Ten - whose portfolio of past works include Jewel Changi Airport and Gardens by the Bay - will provide environmental design consultancy for CQ @ Clarke Quay.The landmark&rsquo s design rejuvenation is conceptualised by Singapore firms Meta Architecture and Formwerkz Architects.
S-Reits which took part in the 2021 GRESB real estate assessment
EIGHTEEN S-Reits out of over 1,500 property companies, Reits, funds and developers participated in the 2021 GRESB Real Estate Assessment. According to GRESB, the assessment is an investor-driven global ESG benchmark and reporting framework for listed property companies, private property funds, developers and investors that invest directly in real estate.
The assessment covers 3 components: management components such as strategies and policies performance components such as greenhouse gas (GHG) emissions and energy consumption development components such as a building&rsquo s design.
Each of the components has a score and is factored into the overall GRESB score and rating. The GRESB rating is relative to the universe of participating entities. Entities in the top/bottom quintile will have a 5-star/1-star rating respectively. Only 20 per cent of entities in each year receive the 5-star rating.
Six S-Reits obtained the 5-star GRESB rating in 2021 &ndash CapitaLand Integrated Commercial Trust : C38U 0%(CICT), Frasers Centrepoint Trust : J69U 0% (FCT), Frasers Logistics & Commercial Trust : BUOU +0.75% (FLCT), Lendlease Global Commercial Reit : JYEU +1.23% (LReit), Manulife US Reit : BTOU +1.79% (MUST) and Suntec Reit : T82U 0%.
CICT&rsquo s sustainability initiatives towards its 2030 targets include a pilot with Tampines Mall as one of the 8 buildings to be part of Singapore&rsquo s first brownfield distribution district cooling (DDC) network pilot by SP Group to allow for more efficient chiller systems operations.
FCT&rsquo s malls, Century Square and Tampines 1, are also part of the DDC network pilot, which is targeted to be operational in 2025. In line with Frasers Property&rsquo s goal to be net zero carbon by 2050, a network of 36 electric vehicle public charging points will be installed across 12 Frasers malls.
FLCT has committed to achieve a net zero carbon status by 2030, in line with its sponsor Frasers Property&rsquo s goal. The trust also aims to achieve green certification for 80 per cent of its portfolio by 2024.
LReit, in line with Lendlease Group&rsquo s Mission Zero targets, aims to achieve net zero carbon (Scope 1 & 2) by 2025 and absolute zero (including Scope 3) by 2040. Some of its reference targets in FY22 include a 20 per cent reduction in energy and GHG emissions and 11 per cent recycling rate in waste.
MUST in 2021 announced its alignment to its sponsor&rsquo s net zero and 80 per cent GHG emissions reduction target by 2050. About 90 per cent of its properties are green certified and the REIT has noted a reduction in GHG intensity and energy intensity by 9.3 per cent and 5.8 per cent year-on-year, respectively.
Suntec REIT in FY21 achieved a 24.6 per cent and 44.3 reduction in energy and water intensities, respectively, from FY19 levels on lower usage during the pandemic and notes that it is on track to achieve its 2024 targets &ndash to reduce energy intensity by 3 per cent in 2024 from FY19 levels, and to maintain water intensity in FY24 from FY19 levels.
CapitaLand, Link Reit vying for NTUC&rsquo s S$4b mall portfolio: sources
CAPITALAND Integrated Commercial Trust (CICT) and Link Real Estate Investment Trust (Link Reit) are among bidders vying for NTUC Enterprise Co-operative Ltd&rsquo s S$4 billion portfolio of shopping malls in Singapore, people with knowledge of the matter said.
CICT is sounding out sources of financing for the prospective transaction, while Hong Kong&rsquo s Link Reit is working with an adviser on a potential bid, said the people, who asked not to be identified as the information is private.
The assets are also drawing interest from other players in Singapore including Frasers Property and Far East Hospitality Trust, the people said. Non-binding bids are due by the end of this month, they added.
Mercatus Co-operative, a unit of NTUC that holds the properties, is working with a financial adviser on the potential sale, Bloomberg News reported last month. The company later confirmed it&rsquo s conducting a strategic review of some of its real estate assets. Mercatus manages assets worth more than S$10 billion and is one of the largest mall owners by floor space in Singapore, according to its website.
Mercatus owns and runs the AMK Hub, Jurong Point and Swing By @ Thomson Plaza, and co-owns NEX. The company also has strata-titled assets within retail malls and at sites in various locations across Singapore, and One Marina Boulevard, a 31-storey office building.
Deliberations are ongoing and the companies could decide not to proceed with offers, the people said. CICT regularly holds discussions with other parties and evaluate possible opportunities, its representative said in response to a Bloomberg News query, adding the company will make appropriate announcements should there be any material developments.
Representatives for Frasers Property, Link Reit and Mercatus declined to comment, while a representative for Far East Hospitality didn&rsquo t immediately respond to requests for comment. BLOOMBERG
new covid-19 restriction measure to limit number of vistors for hospital and care home.
good balance. at least it is calibrated to protect the support facilities and weak.
not over kill measure to hurt commercial activities.
good balance. at least it is calibrated to protect the support facilities and weak.
not over kill measure to hurt commercial activities.
Bulls and Bears fighting....
2 poosible reason for market down.
1 cronies bankers to bring money back to support fed draining liquidity off the market.
2. potential covid-19 if the infection number does not come down. i hope the previous covid-19 force boss go off from the team as he in my opinion is a bit too ks. rich people no problem of lock down. but those live hand to mouth will be badliy affected. reits will be hit. business cannot afford another lock down. many has already used up their reserve buffer. hope the covid infection number come down.
1 cronies bankers to bring money back to support fed draining liquidity off the market.
2. potential covid-19 if the infection number does not come down. i hope the previous covid-19 force boss go off from the team as he in my opinion is a bit too ks. rich people no problem of lock down. but those live hand to mouth will be badliy affected. reits will be hit. business cannot afford another lock down. many has already used up their reserve buffer. hope the covid infection number come down.
May be next week.....
Ling9345 ( Date: 05-Jul-2022 11:38) Posted:
|
Wait for $2
Still on down trend, once break 2.09 may hit 2.05, next support level.
des_khor ( Date: 05-Jul-2022 09:55) Posted:
|
4 days red candle ! Any insight ?
CapitaLand Integrated Commercial Trust sets sights on scaling global ranks
The CEO of Singapore&rsquo s oldest and largest Reit, which celebrates its 20th anniversary this month, says larger asset base necessary to be an international name.
TONY Tan, chief executive officer of CapitaLand Integrated Commercial Trust : C38U -0.92% (CICT), has big ambitions for the Singapore-listed real estate investment trust (S-Reit).
CICT&rsquo s S$14.3 billion market capitalisation as at Jul 1 ranks it as the biggest S-Reit, and one of the 15 biggest counters listed on the Singapore Exchange (SGX).
CICT also sits among the 30 constituents of the benchmark Straits Times Index (STI).
Yet, as Tan explains, in the global market, CICT is considered one of the smallest among the large-cap stocks &ndash defined as companies with market caps of more than US$10 billion.
&ldquo There' s still a long way because we are still not exactly in the spotlight of the big global funds,&rdquo Tan said. &ldquo Once we enter into the big league, it is a different ballgame.&rdquo
&ldquo Liquidity will beget liquidity,&rdquo he added. &ldquo We hope we get more funds invested in us, but we need to make sure that we bulk up the right portfolio.&rdquo
Considered a proxy for Singapore commercial property, CICT has grown significantly through the years.
It made its debut on the Singapore Exchange (SGX) as CapitaLand Mall Trust (CMT) in July 2002, in what was the first Reit listing in Singapore.
CMT started with just 3 malls under its belt &ndash Tampines Mall, Junction 8 and Funan The IT Mall &ndash with total assets worth some S$895 million and a market cap of S$730.6 million at the end of its maiden day of trading.
The Reit then went on an acquisition spree. Over the next 16 years, it would go on to acquire 15 assets including Plaza Singapura, Bugis Junction and Raffles City Singapore.
The Reit also embarked on several development projects. Among them: the greenfield development of Westgate in a joint venture with sponsor CapitaLand, as well as the redevelopment of Funan.
On the asset enhancement front, CMT also led the way for the S-Reits. It was the first Reit here to pilot a unique asset enhancement initiative it calls &ldquo decantation&rdquo .
&ldquo In short, it is taking out a certain space of low or no value and replacing that into a new space which has leasable value,&rdquo Tan said.
For example, in 2004, the Reit transferred 70,000 sq ft of gross floor area from the office tower at Junction 8 to the retail space of the mall.
&ldquo Part of the process was to negotiate with the authorities and agree that this building will be leased out to non-profit organisations. Hence, this net lettable area (NLA) will be taken away from our value and we replace it somewhere else. That' s where we created new NLA that will be able to command higher rent,&rdquo Tan said.
According to the Reit manager, this contributed to a 50 per cent increase in Junction 8&rsquo s average rent between July 2002 and December 2004.
The next lap
The Reit was renamed CICT in 2020 following a merger with CapitaLand Commercial Trust (CCT), which held a portfolio of 10 office and integrated development properties.
The merger between then Singapore&rsquo s second- and third-largest Reits would see the combined CICT own a total of 24 properties with an asset value of S$22.9 billion.
CICT would also leapfrog its way to becoming the third largest Reit in Asia-Pacific &ndash behind Hong Kong&rsquo s Link Reit and Australia&rsquo s Scentre Group &ndash with a theoretical market cap of S$16.8 billion.
The merger had come at an awkward time &ndash in the thick of the Covid-19 pandemic. But the Reit manager believes this may have helped CICT weather the storm better than its peers.
&ldquo In retrospect, (the merger) probably helped us ride through the cycle a lot more smoothly,&rdquo Tan explained. &ldquo Without that, we would probably have seen the 2 (separate) Reits going through significant volatility.&rdquo
When the pandemic hit, the Reit&rsquo s properties in the retail space suffered the immediate brunt of changing regulations and behaviours. &ldquo Some businesses literally stopped, for some of our retail tenants especially,&rdquo he said.
The impact on the commercial or office sector, however, came only later &ndash by which time the retail sector had managed to see some recovery.
This, Tan said, resulted in a smoothening of the impact of the pandemic on the combined Reit, with the enlarged portfolio providing greater stability and resilience.
Post-merger, CICT has continued to keep up the pace of its growth.
In December 2021, it announced the acquisition of 3 assets &ndash 2 office buildings and a 50 per cent interest in an integrated development &ndash in Sydney, Australia, for around S$740 million.
In March this year, it also joined hands with CapitaLand Open End Real Estate Fund (Coref) to acquire a Grade-A office building at 79 Robinson Road for S$1.3 billion.
As at end-December 2021, CICT&rsquo s total assets under management (AUM) stood at S$23.8 billion &ndash over 26 times the AUM of CMT when it was initially listed.
Some 93 per cent of its portfolio by property value is based in Singapore, with another 4 per cent in Germany and the remaining 3 per cent in Australia.
The Reit manager has guided that it intends for the portfolio to maintain a heavy concentration in Singapore, with not more than 20 per cent of its portfolio by value outside of Singapore.
&ldquo (There are) opportunities that still exist within Singapore,&rdquo Tan said. &ldquo We are trying to seize a lot of opportunities with portfolio upscaling. Now that things have stabilised, we can start doing a bit more in-depth study into some of the assets and see whether it makes sense for us to scale up.&rdquo
&ldquo Some of (these potential assets) are operating at suboptimal levels. Is it the best use case? Do we have room to look at redevelopment? (That) will give us another anchor for growth in the medium term,&rdquo he added.
In addition, Tan said there are still assets in the sponsor&rsquo s pipeline that give CICT &ldquo enough room to look at potential future growth opportunities, even within Singapore.&rdquo
The Reit manager&rsquo s growth strategy over the years &ndash combining acquisitions, redevelopment and asset enhancement initiatives &ndash seems to have paid off.
CICT&rsquo s net asset value (NAV) per unit has doubled to S$2.06 as at April, from S$1.03 at the end of 2002.
Some value creation has come from Funan, which saw its NLA more than double to 531,634 sq ft post-redevelopment, compared with 248,376 sq ft at the initial public offering (IPO).
Funan&rsquo s property value has also soared to S$785 million as at end-December 2021, from S$191 million when the Reit was listed in 2002.
Another example is Junction 8, which underwent the decantation exercise. Property value of the asset has jumped to S$796 million as at end December, from S$295 million at listing.
Junction 8&rsquo s net property income has also doubled to S$40.6 million as at Dec 31, from S$20.3 million 2 decades ago.
For FY2021 ended December, CICT posted distribution per unit (DPU) of S$0.104, up from S$0.0869 in the year-ago period, with distributable income increasing 82.7 per cent to S$674.7 million.
Gross revenue grew 75.1 per cent year on year to S$1.3 billion from S$745.2 million, while net property income (NPI) rose 85.5 per cent to S$951.1 million from S$512.7 million.
For Q1 FY2022 ended March, CICT reported a 1.5 per cent increase in gross revenue to S$339.7 million. NPI inched up 0.5 per cent year on year to S$248.3 million.
Recovery to come
Despite potential near-term headwinds &ndash including from continued Covid-19 and geopolitical uncertainties &ndash DBS analysts Rachel Tan and Derek Tan believe CICT has potential for growth on the back of its portfolio optimisation and asset recycling efforts.
&ldquo As the largest commercial S-Reit, CICT is poised to ride on the Singapore office upcycle and retail recovery,&rdquo they said in a report following CICT&rsquo s Q1 FY2022 business update.
&ldquo (As) a key proxy and beneficiary of the reopening play&hellip We estimate CICT could deliver a 6 per cent 2-year compound annual growth rate &ndash one of the stronger growth rates among its peers,&rdquo the analysts added.
DBS has a &ldquo buy&rdquo recommendation on CICT, with a target price of S$2.70.
&ldquo Easing negative retail reversions, together with tailwinds from office sector recovery, and then traction from improving NPI, suggest stronger fundamentals in FY2022,&rdquo said Maybank analyst Chua Su Tye.
&ldquo Its balance sheet remains strong, and we see upside from acquisitions, as management escalates its capital recycling efforts, backed by its sponsor&rsquo s Singapore AUM,&rdquo he added.
Maybank also has a &ldquo buy&rdquo call on CICT, with a target price of S$2.60.
there are sign that incresed number of hk friends are shifting to singapore to setup business and live here.
benefits singapore residential, retail and office spaces.
benefits singapore residential, retail and office spaces.
CICT posts 0.5% rise in Q1 NPI to S$248.3 million
CAPITALAND Integrated Commercial Trust&rsquo s (CICT : C38U 0%) net property income (NPI) inched up 0.5 per cent year on year in the first quarter of 2022 to S$248.3 million, the real estate investment trust' s (Reit) manager announced on Friday (Apr 29) after market close.
The slight yearly growth in NPI was also seen in some of its segments. Retail earnings grew 0.6 per cent to S$101.8 million, integrated development earnings rose 0.8 per cent to S$72.5 million, while NPI from office earnings held steady at S$74 million.
Gross revenue for the 3 months ended Mar 31 also rose marginally to S$339.7 million, up 1.5 per cent from Q1 2021.
The Reit manager also reported a weighted average lease term of 3.7 years for its properties. By segment, CICT&rsquo s retail portfolio WALE is 2 years, while its office and integrated development WALEs are 4 years and 5.4 years respectively.
Its integrated developments also saw an occupancy rise of 1.6 percentage points to 97.6 per cent. However, this was more than offset by its retail and office portfolio occupancies, which fell 0.2 percentage point to 96.6 per cent and a 0.1 percentage point to 91.4 per cent respectively. CICT&rsquo s overall portfolio occupancy dropped 0.3 percentage point to 93.6 per cent quarter on quarter.
As Singapore&rsquo s Covid-19 measures were further eased on Apr 26, CICT is maintaining a positive business outlook. The Reit manager noted that the unemployment rate declined to 2.7 per cent in 2021 from 3.0 per cent in 2020, while the country&rsquo s gross domestic product is expected to grow between 3.0 per cent and 5.0 per cent for 2022.
The manager added that prime retail rents have remained stable in view of the eventual return of tourists, as well as employees to offices. Suburban market rents also continued to rise on limited availability in Q1 2022.
Meanwhile, on the office market outlook, CICT said: &ldquo CBRE expects office rents in the Grade A CBD Core market to grow by 6.9 per cent y-o-y for 2022, supported by demand from agile space, technology and non-bank financial sectors and limited supply.&rdquo
CICT enters into several interested person transactions for its properties including Raffles City Singapore
The manager of CapitaLand Integrated Commercial Trust Management (CICT) has entered into several agreements on April 18 pertaining to its properties, Tampines Mall, Raffles City Singapore and Asia Square Tower 2.
The agreements were entered with SP Sustainability & Engineering, SembWaste and Real Taste Pte Ltd.
On April 18, CICT entered into a new service agreement with SP Sustainability & Engineering, where the latter will provide district cooling services at Tampines Mall for 30 years, beginning in 2024 through to 2053.
Under the agreement, CICT will pay an estimated total of $64.4 million to SP as fees for the district cooling services. The fees are based on the chilled water tariff charged by SP, which comprises the cost of service connection facility, fixed contract capacity rate, flexible contract capacity rate and usage unit rate.
CICT has, on the same day, entered into a new service agreement via RCS Trust with SembWaste. Under the agreement, SembWaste will provide refuse management and recycling services at Raffles City Singapore for seven years. This includes an option to renew for a further term of three years. The agreement will commence May 1.
RCS Trust will have to pay an estimated total sum of $1.08 million to SembWaste as fees for the services.
SembWaste was appointed following an open tender process during which the pricing and quality of services offered by SembWaste was reviewed and evaluated against other service providers, says the REIT manager. It adds that the agreement was made on normal commercial terms and not prejudicial to the interests of CICT and its minority unitholders.
At the same time, a lease agreement has been made between CapitaLand Commercial Trust (CCT) and Real Tasty in respect of the premises at a unit on level 2 of Asia Square Tower 2 for three years, beginning May 23. Real Tasty will have to pay CCT an estimated total sum of $284,000 during the lease period. The rent was negotiated at arm&rsquo s length after considering the lease, size, condition and location of the premises.
According to CICT&rsquo s manager, an independent valuer was appointed to provide an independent opinion on the terms of the lease. The rent as at the date of commencement of the lease, is said to be at market level. The other key commercial terms of the lease are normal commercial terms and in accordance with market standards.
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SP Sustainability & Engineering and SembWaste are subsidiaries of Temasek Holdings while Real Taste is an associate of Temasek.
Temasek is a controlling shareholder of CICT, with a total interest of 1.59 billion units in CICT, or 24.05% of its total units in issue through its subsidiaries and associated companies.
Under the listing rules, an interested person transaction (IPT) must be announced if the value of the IPT is equal to or exceeds 3% but is less than 5% of the latest audited consolidated net tangible asset (NTA) of the issuer and its subsidiaries.
As at April 18, the value of all IPTs entered into between CICT and Temasek is around $569.43 million and around $566.29 million under rules 905 and 906 of the listing manual.
This might just head to 2.5-2.6 like how it was just before covid