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You?ll then soon have no more malls
With Govt limiting the amount of land to be built as malls in Singapore, rentals can be continuously pushed up and up.
Joelton ( Date: 20-Apr-2024 11:06) Posted:
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Higher gross rental income, lower expenses boost CICT' s Q1 NPI by 6.3%
The Reit' s retail and office assets and integrated developments also book year-on-year gains in gross revenue and NPI
CAPITALAND Integrated Commercial Trust (CICT) on Friday (Apr 19) posted a 6.3 per cent rise in net property income (NPI) to S$293.7 million for its first quarter end : C38U +1.08% (CICT) on Friday (Apr 19) posted a 6.3 per cent rise in net property income (NPI) to S$293.7 million for its first quarter ended Mar 31.
Its manager said in a business update that the growth in NPI was supported by a rise in gross rental income and lower operating expenses.
The real estate investment trust (Reit) recorded a 2.6 per cent increase in gross revenue to S$398.6 million.
Its retail and office assets, as well as integrated developments, also booked year-on-year gains in gross revenue and NPI.
Portfolio committed occupancy stood at 97 per cent for the quarter, down 0.3 percentage point from the previous quarter. Its weighted average lease expiry was up slightly by 0.2 years to 3.6 years, while the average debt term to maturity fell 0.1 years to 3.8 years.
Its aggregate leverage stood at 40 per cent as at Mar 31, up slightly from 39.9 per cent as at Dec 31, 2023.
During the quarter, CICT commenced its asset enhancement initiatives for IMM Building in Singapore and the skyscraper Gallileo in Frankfurt, Germany. It obtained a lease agreement with the European Central Bank for 93 per cent of Gallileo' s net lettable area.
Market seems to like the business update.
20240419_064058_C38U_4C1BI6QJBER19T9G.1.pdf (cict.com.sg)
1Q Business update.
Key note: 1Q 2024 Y/Y increase in NPI = 6.3%
See website for more details
1Q Business update.
Key note: 1Q 2024 Y/Y increase in NPI = 6.3%
See website for more details
Bring your own food
Why they so lidat? No shopping vouchers?
But will have food?
But will have food?
CICT AGM 2024 on Mon 29 Apr 2.30pm
Star gallery lvl 3
Star performing arts Ctr
1 Vista Exchange Green
No voucher
no door gift.
Only coffee and tea served.
Star gallery lvl 3
Star performing arts Ctr
1 Vista Exchange Green
No voucher
no door gift.
Only coffee and tea served.
1Q business update tmr.
Just as DBS is to STI
CICT is to SG REITS
Just as DBS is to STI
CICT is to SG REITS
Yeah. It was not really a yield accretive acquisition resulting in lower dividend payouts per share since 2019.
But a solid REIT
But a solid REIT
the merger with cct. eat already having hard time to fully digest it. too generous in the take over.
still better then mapletree commercial. eat north asia business having serious indigestions.
they were even more generaous pay way above what north asia was worth.
still better then mapletree commercial. eat north asia business having serious indigestions.
they were even more generaous pay way above what north asia was worth.
Again over at investingnote people promote this one at 1.89-92.
Claims that yield is 5.6%.
Invest in large REITS with solid sponsors
Claims that yield is 5.6%.
Invest in large REITS with solid sponsors
CICT&rsquo s lower DPU, higher gearing since pandemic may have some investors questioning its strategy
AN AWKWARD question came up during the CapitaLand Integrated Commercial Trust (CICT) financial results briefing last week.
One analyst pointed out that CICT&rsquo s distribution per unit (DPU) of 10.75 Singapore cents for FY2023 was still well below the 11.97 cents it achieved in FY2019.
The trust&rsquo s current performance versus FY2019 is relevant not just because FY2019 was the year before the pandemic forced everyone to stay home, but also because FY2019 was the last full financial year before CICT merged with CapitaLand Commercial Trust (CCT).
CICT was previously known as CapitaLand Mall Trust. It merged with CCT in 2020, in what was touted as a game-changing transaction that would enable it to grow faster and more sustainably.
So, why did CICT &ndash more than three years after its supposedly transformative merger &ndash report a DPU more than 10 per cent below what it achieved in FY2019? And, when will its DPU recover to its pre-pandemic level?
&ldquo The interest rate environment is just different,&rdquo replied Tony Tan, chief executive of CICT&rsquo s manager. &ldquo But as a combined vehicle, we are more resilient,&rdquo he added.
Last week, CICT said that its average debt cost in FY2023 was 3.4 per cent. This was higher than its average debt cost of 2.7 per cent in FY2022, and 2.3 per cent in FY2021.
But it was not that much higher than CICT&rsquo s average debt cost of 3.2 per cent back in FY2019.
If CICT is feeling the pressure of higher interest rates, it might be partly because it is more heavily geared than it was before it enlarged itself by merging with CCT.
Under the merger, CICT paid S$259 in cash and issued 720 new units for every 1,000 CCT units. In total, CICT expanded its outstanding units by some 75 per cent and forked out S$1 billion in cash.
CICT&rsquo s aggregate leverage rose from 32.9 per cent at the end of FY2019, to 40.6 per cent at the end of FY2020.
With the surge in interest rates over the last two years, CICT is now trying to reduce its gearing while improving the yields from its properties.
CICT said last week that its aggregate leverage stood at 39.9 per cent at the end of FY2023, down from 40.4 per cent at the end of FY2022.
FCT&rsquo s big expansion
While there are several other property trusts in the Singapore market with DPUs below their pre-pandemic levels, one retail property trust has expanded significantly through the recent crisis.
In September 2020 &ndash as CICT was working on its merger with CCT &ndash Frasers Centrepoint Trust (FCT) said it would acquire the 63.1 per cent of the AsiaRetail Fund (ARF) that it did not already own for S$1.057 billion.
ARF held five shopping malls and an office building in Singapore, with a total agreed value of S$3.065 billion.
To fortify its balance sheet, FCT raised more than S$1.3 billion through a placement and preferential offering of new units, which expanded its total outstanding units by more than 50 per cent.
With ARF&rsquo s properties in its fold, FCT&rsquo s revenue and distributable income for the financial year to Sep 30, 2021, more than doubled. Its DPU for FY2021 came in at 12.085 cents &ndash which was 33.7 per cent more than its FY2020 DPU of 9.042 cents, and just a hair above its pre-pandemic FY2019 DPU of 12.07 cents.
FCT ended its FY2021 with an aggregate leverage of only 33.3 per cent.
With further management of its portfolio, FCT&rsquo s DPU for FY2022 and FY2023 came in at 12.227 cents and 12.15 cents, respectively. Its aggregate leverage ended FY2023 at 39.3 per cent, but FCT said that it would decline to 36.1 per cent with the completion of two announced asset sales.
Improving performance
Against this backdrop, CICT&rsquo s higher aggregate leverage and lower DPU since the onset of the pandemic might have some investors questioning its strategy.
The good news is CICT&rsquo s improving operational performance is keeping analysts positive on its units.
For FY2023, CICT reported an 8.2 per cent rise in revenue to S$1.6 billion and a 7 per cent increase in net property income to S$1.1 billion. This was attributed to higher contribution from Raffles City Singapore, and the full-year contribution from acquisitions completed in 2022.
CICT&rsquo s portfolio occupancy rate stood at 97.3 per cent in FY2023, up from 95.8 per cent in FY2022. CICT reported positive rent reversion of 8.5 per cent for new leases and renewals in its retail property portfolio, and 9 per cent for its office property portfolio. Its portfolio property valuation increased 1.2 per cent to S$24.5 billion.
CICT is reportedly shopping some of its assets around, which could help reduce its aggregate leverage and facilitate further reconstitution of its portfolio.
DBS and RHB maintained their &ldquo buy&rdquo recommendations on CICT following the release of its results last week.
DBS has a target price of S$2.30, while RHB has a target price of S$2.20.
It may be a tall order for CICT to top its pre-pandemic DPU this year, though. DBS is forecasting a DPU of 10.3 cents for FY2024, while RHB is forecasting a DPU of 11 cents.
CICT posts 1.7% rise in H2 DPU to S$0.0545
CAPITALAND : C38U +1.02%Integrated Commercial Trust : C38U +1.02% (CICT) on Tuesday (Feb 6) posted a distribution per unit (DPU) of S$0.0545 for the second half ended December, up 1.7 per cent from S$0.0536 in the previous corresponding period.
This came as gross revenue rose, helped by higher rental and occupancy rates, which supported a rise in net property income (NPI).
Gross revenue was up 4.1 per cent to S$785.2 million for the half-year period, from S$754.1 million in the year-ago period.
Property operating expenses for CICT&rsquo s assets grew 4.3 per cent to S$221.6 million, from S$212.5 million previously, on higher utilities, maintenance and marketing expenses.
NPI, meanwhile, grew 4 per cent on the year to S$563.6 million for the half-year period, from S$541.7 million.
Distributable income (DI) was up 2.1 per cent to S$362.5 million from S$355.1 million in the same period the year before.
The real estate investment trust (Reit) will pay the distribution on Mar 28, after the record date on Feb 15.
Teo Swee Lian, chairman of CICT&rsquo s manager, said the Reit adopted a conservative approach in 2023 in response to challenging market conditions and a high-cost environment.
&ldquo We focused on driving organic growth through proactive portfolio management, prudent cost management and discipline in capital management. This strategy has yielded positive results.&rdquo
For the full year ended Dec 31, 2023, DPU was 1.6 per cent higher at S$0.1075. Distributable income climbed 1.9 per cent to S$715.7 million. Gross revenue was 8.2 per cent higher at S$1.6 billion, while NPI rose 7 per cent to S$1.1 billion for the full year.
The improvement in performance came mainly from higher contributions from Raffles City Singapore, coupled with full-year contributions from the Reit&rsquo s 2022 acquisitions, the manager said.
The gains were offset by higher finance costs from the full-year impact of borrowings taken to fund the acquisitions in 2022 and higher interest rates.
Speaking at an earnings briefing on Tuesday, Tony Tan, chief executive of the manager, noted that there is more investor interest for transactions returning to the market.
He noted that one of the challenges in global real estate has been private equity players going through some rationalisation not many transactions were made in the past 12 months, but there is starting to be some interest from such players.
In response to questions that CICT is reportedly looking to divest some assets, Tan said the manager does not comment on rumours.
&ldquo It&rsquo s actually not unusual for us to engage the market&hellip sometimes it leads to some kind of commercial deal, sometimes it doesn&rsquo t,&rdquo he said.
&ldquo If we do have to monetise some assets, naturally next on our mind is how we are going to deploy it,&rdquo he added. The manager observed that retail assets are still yielding more than office assets and more accretive. &ldquo Having said that, we will look at it closely when the time comes,&rdquo Tan said.
CICT has a call option that allows it to increase its stake in CapitaSpring within five years of the asset&rsquo s temporary occupation permit (TOP) date in November 2021. Tan noted that CapitaSpring has not completed one lease cycle yet.
&ldquo It&rsquo s important we witness that, because for new developments, the expense and post-stabilisation expense would be different,&rdquo he said. The manager would also consider the size of the asset in making its decision.
&ldquo It&rsquo s a very chunky asset. We don&rsquo t necessarily have to own 100 per cent. We own 45 per cent today, the question is whether we should own more,&rdquo he said. &ldquo So that&rsquo s something we&rsquo ll take back and think about it.&rdquo
CICT is also undertaking asset enhancement initiatives (AEI) this year to optimise its portfolio.
This includes a S$48 million AEI at IMM Building, and up to a 215-million-euro AEI at the Gallileo office building in Frankfurt, Germany.
Tan noted that the Reit has to fix some fundamental issues at the Gallileo asset to make it more relevant. While the asset would have 18 months of downtime, he noted that the asset&rsquo s contribution to DI was &ldquo not huge&rdquo , and that managing interest costs would have a bigger impact.
&ldquo Interest expense is the single largest subtraction from the distribution,&rdquo he noted.
CICT&rsquo s average cost of debt rose to 3.4 per cent as at Dec 31, up from 3.3 per cent in September. Based on current interest rate levels, the manager said it expects the average cost of debt to rise to around the mid-3 per cent range this year.
Tan said the manager is looking to pare down its gearing, and that aggregate leverage at around the 37- to 38-per-cent level would give sufficient flexibility. CICT&rsquo s aggregate leverage as at Dec 31 stood at 39.9 per cent, down from 40.8 per cent three months earlier.
DBS analysts said in a note that CICT&rsquo s FY2023 performance was in line with estimates, and maintained a &ldquo buy&rdquo call with a target price of S$2.30.
&ldquo We expect Singapore assets will likely remain stable with upside from retail and office, riding on the strong positive reversions over the past year. However, overall growth could moderate with the AEI plans at Gallileo,&rdquo they said.
CICT&rsquo s committed portfolio occupancy was 97.3 per cent for the 12 months ended December 2023, up 1.5 percentage points from the same period the previous year.
Temasek' s Fullerton acquires 795,700 units in CICT at $1.9019 each
Fullerton, an investment manager that is an indirect subsidiary of Temasek Holdings, has acquired 795,700 units of CapitaLand Integrated Commercial Trust C38U -1.49% (CICT) C38U -1.49% for a total sum of $1,513,341.83 or $1.9019 each.
The units were purchased on Dec 12 via the market.
Following the acquisition, Fullerton&rsquo s stake in the REIT is now at 0.4786%.
CICT reported a net property income (NPI) of $275.0 million for the 3QFY2023 ended Sept 30, a 0.6% increase y-o-y. Its NPI for the 9MFY2023 grew by 6.8% y-o-y to $827.3 million.
I agree. Ion Irchard, Plaza Sing, Raffles City very crowded nowadays.
Once break 1.9 will be rocket liao. Good luck
Will it back to $2 ?
according to cict latest business update.
wework contribute 2.4% in gross rent.
2023 cict dividend is 10.7 cents. reduction of 2.4% of 10.7 is about 0.02568 cents.
if wework file for chap 11 means they try to save themselves from debtors. so they will want to continue to work. so likely work out some payment schedule for space they need.
location they currently occupy is funan and 21 collyer quay. both in cbd. so should be no problem in finding replace rent if needed. the most disrupt for a while.
the drop in reits price recently more then compensate for such event in the worse case.
last time people use other us company in problem in the end also not much impact.
wework contribute 2.4% in gross rent.
2023 cict dividend is 10.7 cents. reduction of 2.4% of 10.7 is about 0.02568 cents.
if wework file for chap 11 means they try to save themselves from debtors. so they will want to continue to work. so likely work out some payment schedule for space they need.
location they currently occupy is funan and 21 collyer quay. both in cbd. so should be no problem in finding replace rent if needed. the most disrupt for a while.
the drop in reits price recently more then compensate for such event in the worse case.
last time people use other us company in problem in the end also not much impact.
WeWork Plans to File for Bankruptcy as Early as Next Week
Once a venture capital-backed star with an astronomical valuation, the flexible-office-space provider is now preparing for chapter 11 protection
Updated Oct. 31, 2023 5:19 pm ET|WSJ PRO