CapitaLand Investment Limited (SGX: 9CI) is a well-known real estate investment manager in Singapore. It’s also the sponsor for several real estate investment trusts (REITs) listed on the Singapore Exchange (SGX).
Today, CapitaLand Investment’s six listed funds across Singapore and Malaysia have funds under management (FUM) of some S$60 billion.
In this week’s edition of 4 Stocks This Week, let’s explore four of the biggest CapitaLand REITs by market capitalisation listed here, and how they have performed in the latest financial period.
CapitaLand Integrated Commercial Trust (SGX: C38U)
CapitaLand Integrated Commercial Trust (SGX: C38U) is the first and largest REIT listed on the Singapore Exchange.
It made its trading debut as CapitaLand Mall Trust in July 2002 and was renamed CapitaLand Integrated Commercial Trust in November 2020 following the merger with CapitaLand Commercial Trust.
Currently, CapitaLand Integrated Commercial Trust has office and retail presence in Singapore, Australia, and Germany. In Singapore, it owns properties such as Asia Square Tower 2, Bugis Junction, and Funan.
For the third quarter of 2022, CapitaLand Integrated Commercial Trust’s gross revenue grew 13.7% year-on-year to S$374.1 million while its net property income (NPI) rose 12.7% year-on-year to S$273.3 million.
The majority of the REIT’s gross revenue and NPI growth came from its office assets on the back of new acquisitions.
Source: CapitaLand Integrated Commercial Trust 3Q 2022 Business Update
CapitaLand Integrated Commercial Trust’s portfolio occupancy rate stood at 95.1% as of 30 September 2022, an improvement from 93.8% seen at end-June 2022.
Meanwhile, the REIT’s portfolio weighted average lease to expiry was stable at 3.8 years, with no single tenant contributing to over 5.1% of the REIT’s total gross rental income. This shows that its revenue base is sufficiently diversified.
In terms of balance sheet strength, CapitaLand Integrated Commercial Trust’s gearing ratio was 41.2%, as of end-September 2022 and 80% of its borrowings were on fixed rates, mitigating the impact of rising interest rates.
Looking ahead, shoppers can look forward to completion of asset enhancement initiatives (AEIs) at Raffles City Singapore in the fourth quarter of this year and at CQ @ Clarke Quay in the third quarter of 2023. Once the AEIs are completed, investors might be able to enjoy an uplift of rental income.
At CapitaLand Integrated Commercial Trust’s unit price of S$2.07, it has a price-to-book (P/B) ratio of around 1.0x and a distribution yield of 4.3%.
CapitaLand Ascendas REIT (SGX: A17U)
CapitaLand Ascendas REIT (SGX: A17U) is Singapore’s first and largest listed business space and industrial REIT.
As of 30 September 2022, its portfolio asset value stood at S$16.5 billion, with most of its over 200 properties located in Singapore.
CapitaLand Ascendas REIT announced a proposed acquisition of two properties in Singapore with a total cost of S$296.7 million during the third quarter of 2022. One is an industrial property located in Toa Payoh and the other a logistics asset located at Buroh Lane. The acquisitions are estimated to be completed by the first quarter of 2023.
As of 30 September 2022, CapitaLand Ascendas REIT had a healthy gearing ratio of 37.3%, with 78% of its total debt on fixed rates.
The REIT said that there’s an available debt headroom of around $4.4 billion before it reaches the regulatory gearing limit of 50%. Therefore, CapitaLand Ascendas REIT can easily finance the two property acquisitions mentioned earlier.
Source: CapitaLand Ascendas REIT 3Q 2022 Business Update
CapitaLand Ascendas REIT’s portfolio occupancy is also strong at 94.5%, as of end-September 2022. This figure grew from 91.7% in September 2021 and from 94.0% in June 2022.
In Singapore, as part of CapitaLand Ascendas REIT’s asset rejuvenation plan, several AEIs and redevelopment projects are ongoing to upgrade property specifications and unlock value through repositioning.
At a unit price of S$2.82, CapitaLand Ascendas REIT has a P/B ratio of around 1.1x and a distribution yield of 4.8%.
CapitaLand Ascott Trust (SGX: HMN)
CapitaLand Ascott Trust (SGX: HMN) is the biggest hospitality trust in the Asia Pacific. The REIT’s portfolio consists of 95 properties, with a total asset value of S$7.6 billion, as of 30 June 2022. In all, its portfolio contains 54 serviced residences, 18 hotels, 14 rental housings, and nine student accommodations.
CapitaLand Ascott Trust’s diversified hospitality portfolio gives a mix of both stable and growth income streams.
For the hospitality trust’s third quarter of 2022, its revenue and gross profit were higher year-on-year due to contributions from 7 new acquisitions and a full quarter contribution from Wildwood Lubbock.
Furthermore, stronger operating performance of the trust’s existing portfolio also led to the better financial performance.
Excluding the contributions from the eight properties, gross profit on a like-for-like basis rose a whopping 70% year-on-year.
CapitaLand Ascott Trust said that its latest gross profit is already around 90% of pre-Covid levels on the back of contributions from new properties and higher revenue per available unit (RevPAU).
Source: CapitaLand Ascott Trust Investor Presentation
Just like CapitaLand Integrated Commercial Trust and CapitaLand Ascendas REIT, CapitaLand Ascott Trust’s gearing ratio is at a healthy level, standing at 35.8% at the end of September 2022. Meanwhile, 76% of its total debt is on fixed rates.
Looking ahead, even though there are headwinds coming from rising interest rates and labour shortages, CapitaLand Ascott Trust is poised to ride the hospitality sector recovery as with more key destinations easing travel restrictions.
At CapitaLand Ascott Trust’s unit price of S$0.945, it has a P/B ratio of 0.7x and a distribution yield of 5.5%.
CapitaLand China Trust (SGX: AU8U)
CapitaLand China Trust (SGX: AU8U) is Singapore’s first and largest China-focused REIT with a portfolio of 20 assets in China, consisting of retail malls, business parks, and logistics parks.
Source: CapitaLand China Trust 3Q 2022 Business Update
CapitaLand China Trust’s gross revenue and NPI for the first nine months of 2022 rose 7.0% and 7.5%, respectively, year-on-year. The REIT’s portfolio was uplifted by the full contributions from business parks and logistics parks.
CapitaLand China Trust’s retail component also saw its first positive reversion since the start of the coronavirus pandemic, boosted by the completion of CapitaMall Wangjing’s AEI. Retail occupancy was strong at 96.7%, as of 30 September 2022, even though it fell from 98.4% exactly a year back.
Over the long term, CapitaLand China Trust has plans to reduce its reliance on retail assets and expand further into the new economy sector and then into commercial/integrated developments.
Source: CapitaLand China Trust 3Q 2022 Business Update
With an acceptable gearing ratio of 39.3% (as of 30 September 2022) and a strong sponsor in CapitaLand Investment, CapitaLand China Trust should be able to capitalise on the growth opportunities available in the world’s most populous country.
At a unit price of S$1.13, CapitaLand Ascendas REIT has a P/B ratio of around 0.7x and a distribution yield of 8.2%.
The post Performance To CapitaLand REITs: CapitaLand Integrated Commercial Trust; CapitaLand Ascendas REIT; CapitaLand Ascott Trust; CapitaLand China Trust appeared first on DollarsAndSense.sg.
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