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The market value of the Singapore-listed Reit has risen some 19.2 per cent in the year to date.
SINGAPORE - CapitaLand Integrated Commercial Trust (CICT) is now the largest real estate investment trust (Reit) in Asia.
This comes on the heels of a private placement in August, where the Reit manager issued some 284.4 million new units at $2.11 apiece. The gross proceeds of $600 million raised were mainly used to finance the proposed acquisition of the remaining 55 per cent interest in the office and retail component of CapitaSpring.
The market value of the Singapore-listed Reit (S-Reit) has risen some 19.2 per cent in the year to date to $17.5 billion, as at 12 pm on Oct 1. It thus pipped former leader Link Reit, which is listed on the Stock Exchange of Hong Kong and has a market capitalisation of HK$103.3 billion (S$17.1 billion).
A stalwart of Singapore’s benchmark Straits Times Index (STI), CICT has ridden a wave of investor interest this year amid expectations that interest rates have peaked, which bodes well for the Reits.
Then, there is the ongoing equities market review, led by the Monetary Authority of Singapore, to revitalise Singapore’s flagging bourse.
Investor sentiment has improved on the back of initiatives such as a $5 billion injection to strengthen the fund management ecosystem and boost trading liquidity, tax perks for companies listing in Singapore, and a pair of new indices to track the next tranche of the largest and most liquid companies beyond the STI constituents.
Among other things, this has sparked a wave of initial public offering activity in Singapore, especially in the third quarter.
Meanwhile, the STI has risen 14.2 per cent in the year to date, with the S-Reits gaining 9.4 per cent over the same period. The mid-caps have also climbed 9 per cent.
A question of currency
But CICT’s rise to the top of the Reits market in Asia could come down to one thing: the strength of the Singapore dollar.
The Singdollar has climbed 5.4 per cent against the US dollar so far this year, while the Hong Kong dollar has weakened 0.2 per cent against the greenback over the same period.
In local currency terms, Hong Kong’s Link Reit has outperformed CICT in the year to date.
The internally managed Reit has seen its unit price climb 21.8 per cent this year to HK$40 on Oct 1.
Link Reit owns a portfolio of properties including retail facilities, car parks, offices and logistics assets across China, Australia, Singapore and the United Kingdom, which was valued at HK$226 billion as at the end of March.
For the full year ended March, Link Reit’s distribution per unit (DPU) grew 3.7 per cent year on year to HK$2.7234, from HK$2.6265 the year before. Total distributable amount was up 4.6 per cent to HK$7 billion.
Net property income (NPI) rose 5.5 per cent to HK$10.6 billion on improved performance across most of its operating markets, while revenue climbed 4.8 per cent to HK$14.2 billion.
In comparison, CICT saw its NPI and revenue shrink marginally for the latest six-month period to June.
Its NPI for the first half-year dipped 0.4 per cent to $579.9 million, while revenue eased 0.5 per cent to $787.6 million.
This was mainly due to the absence of income from 21 Collyer Quay, which was divested in November last year, and ongoing asset enhancement works at its Gallileo commercial building in Frankfurt’s banking district.
For the first half-year ended June, CICT’s DPU rose 3.5 per cent to $0.0562 on an enlarged unit base, while distributable income grew 12.4 per cent to $411.9 million.
The diversified Reit – formerly known as CapitaLand Mall Trust before its merger with CapitaLand Commercial Trust in 2020 – had a portfolio property value of $27 billion as at the end of December 2024, comprising retail, office and integrated development assets in Singapore, Australia and Germany.
Meanwhile, waiting in the wings to ascend the throne – though still some way off – is CapitaLand Ascendas Reit.
[SRC] https://www.straitstimes.com/business/companies-markets/cict-overtakes-hong-kongs-link-reit-to-become-asias-largest-real-estate-investment-trust
