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Tag: CRCT

  • CapitaLand sells stake in CapitaMall Wuhu

    CapitaLand sells stake in CapitaMall Wuhu

    CapitaLand Retail China Trust (CRCT) and CapitaLand will divest their combined 100 per cent interests in CapitaMall Wuhu to an unrelated third party.

    Located in Wuhu city in China’s Anhui Province, CapitaMall Wuhu is a five-storey shopping mall of around 45,000sqm that has been closed since the third quarter of last year, following the exit of its anchor tenant.

    “The divestment of CapitaMall Wuhu is in line with our proactive asset-management strategy to optimise CRCT’s portfolio and enhance returns,” said CRCT Management Ltd CEO Tan Tze Wooi.

    “As our 51-per-cent stake in CapitaMall Wuhu accounts for less than 1 per cent of CRCT’s asset size, its sale is expected to have minimal impact on CRCT’s core business. The sale proceeds will provide CRCT with greater financial flexibility to take advantage of market opportunities. We remain on the lookout for strategic opportunities to reconstitute and strengthen our portfolio.”

    The transaction between the firms’ respective subsidiary and associate is based on the company’s adjusted net asset value – including (but not limited to) its interest in CapitaMall Wuhu of RMB210 million (US$31.25 million).

    After taking into account the estimated fees, taxes and other related expenses, it is estimated that the net proceeds from the divestment would be RMB90.6 million ($13.48 million). The net divestment proceeds may be used for reducing existing debt and/or financing general corporate or working capital requirements.

    CapitaLand Group’s president Lucas Loh commented: “The sale of CapitaMall Wuhu will unlock capital that can be redeployed to core assets in cities where CapitaLand enjoys scale and competitive advantage. We will stay disciplined in our capital-recycling efforts and continually review opportunities to optimise CapitaLand’s portfolio, which includes divestment of assets that are non-core or have limited growth.”

    The divestment of CapitaMall Wuhu is expected to be completed in the second half of this year.

    Following the divestment, CRCT’s portfolio will have 10 malls in seven Chinese cities, while CapitaLand’s retail network in China will comprise 51 malls in 21 cities.

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  • CRCT and CapitaLand to divest their interests in CapitaMall Wuhu

    CRCT and CapitaLand to divest their interests in CapitaMall Wuhu

    CapitaLand Retail China Trust (CRCT) and CapitaLand today announced that their respective subsidiary and associate have entered into an agreement to divest their combined 100% interests in a company, which owns CapitaMall Wuhu, to an unrelated third party.  The transaction is based on the company’s adjusted net asset value, including but not limited to its interest in CapitaMall Wuhu of RMB210 million (about S$41.5 million).

    Mr Tan Tze Wooi, CEO of CapitaLand Retail China Trust Management Limited, said: “The divestment of CapitaMall Wuhu is in line with our proactive asset management strategy to optimise CRCT’s portfolio and enhance returns.  As our 51% stake in CapitaMall Wuhu accounts for less than 1% of CRCT’s asset size, its sale is expected to have minimal impact on CRCT’s core business.  The sale proceeds will provide CRCT with greater financial flexibility to take advantage of market opportunities.  We remain on the lookout for strategic opportunities to reconstitute and strengthen our portfolio.”

    Mr Lucas Loh, President (China & Investment Management), CapitaLand Group, said: “The sale of CapitaMall Wuhu will unlock capital that can be redeployed to core assets in cities where CapitaLand enjoys scale and competitive advantage.  We will stay disciplined in our capital recycling efforts and continually review opportunities to optimise CapitaLand’s portfolio, which include divestment of assets that are non-core or have limited growth.”

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  • Tenant reshuffles bring good revenue for CapitaLand Retail China

    Tenant reshuffles bring good revenue for CapitaLand Retail China

    CapitaLand Retail China boosted its distributable income by 9.4 per cent last year on the back of a new acquisition and improved performance of multi-tenanted malls. CapitaLand Retail China Trust Management (CRCTML), the manager of CapitaLand Retail China Trust (CRCT), reported a distributable income of S$99.7 million (US$73.5 billion) for the year.

    “CRCT delivered a resilient set of results in FY2018 on the back of strong operating performance,” said CRCTML CEO Tan Tze Wooi.

    Portfolio occupancy as at December 31 was 97.5 per cent and rental reversion was 10.9 per cent. Tenants’ sales at its multi-tenanted malls grew by 18.8 per cent year on year, while shopper traffic was up by 19.4 per cent.

    With the addition of Rock Square in the full-year figures for the first time, CRCT’s investment property value rose by 17.8 per cent to RMB13.993 billion (US$2.07 billion) as at the end of the year.

    CRCTML chairman Soh Kim Soon said China’s retail sales rose by 9 per cent last year.

    “China’s more moderate pace of growth is reflective of an economy undergoing transition and its long-term fundamentals remain positive. We are confident that CRCT’s quality family-oriented shopping malls will continue to benefit from China’s growing middle class and policies implemented to stimulate the economy,” he said.

    Highlights of the year included:

      • CapitaMall Wangjing posted a rental reversion of 15.7 per cent after converting 4700sqm of anchor tenant space on Level 4 to specialty stores. The mall’s Level 8 rental income will rise by around 50 per cent after transforming 500sqm of common area into leasable space for coworking operator Ucommune.
      • CapitaMall Xinnan netted 17.9 per cent in rental reversion by reconfiguring its Basement 1 space to accommodate more popular brands.
      • Since acquisition, Rock Square has achieved four consecutive quarters of rental reversions above 20 per cent and a double-digit year-on-year increase in average sales per square metre for specialty stores.

    Wooi said that in order to further optimise the portfolio, CRCT has entered into a bundle deal in Hohhot with unrelated third parties to divest CapitaMall Saihan and acquire a new mall that is double in size and has “a longer balance tenure”.

    “Given the new mall’s higher growth potential, CRCT will be in an even stronger position to tap Hohhot’s promising retail growth. The deal is structured to minimise income disruption as the closure and divestment of CapitaMall Saihan will take place after the new mall is operational in the second half of the 2020 [financial year]. Supported by CRCT’s strong financial position, we will continue to explore suitable acquisition opportunities to grow and rejuvenate our portfolio,” Wooi concluded .

  • High occupancy pays off for CapitaLand China malls

    High occupancy pays off for CapitaLand China malls

    High occupancy rates of the CapitaLand China malls portfolio helped deliver a 10.5 per cent increase in distributable income in the three months to September. CapitaLand Retail China Trust Management Limited (CRCTML), the manager of CapitaLand Retail China Trust (CRCT), says income reached S$23.6 million this year, compared with $21.4 million the same quarter last year.

    CRCTML CEO Tan Tze Wooi said China’s retail sales rose 9.3 per cent year on year during the first nine months of this year to RMB 27.4 trillion (US$3.93 trillion), while urban disposable income and expenditure per capita grew 7.9 per cent and 6.5 per cent respectively.

    “China is now growing from a larger base and its long-term fundamentals remain strong,” he said. “With our quality portfolio of malls offering holistic lifestyle experiences, CRCT will stand to benefit from China’s improving household income and rising consumer aspirations.”

    During the latest quarter, CRCT achieved a 2.2 per cent increase in net property income to $36.7 million, driven by broad-based rental growth and effective cost management.

    Wooi said the trust’s portfolio achieved an occupancy rate of 97.7 per cent at the end of September and rental reversion was “a robust 12.1 per cent”.

    “Our active asset management strategy with a tailored approach for each mall is progressing well. Rock Square registered a strong positive rental reversion above 20 per cent for the third consecutive quarter by bringing in 25 prominent international and domestic brands, many of which are new-to-market in Haizhu District.

    “To differentiate CapitaMall Qibao’s offerings, we increased its exposure to the resilient learning and education sector by more than three times over the last five years. We also expanded the rooftop playground to host more interactive activities that are popular with children, further enhancing CapitaMall Qibao’s attractiveness to young families.”

    CRCT is the first China shopping mall Real Estate Investment Trust (Reit) in Singapore, with a portfolio of 11 shopping malls: CapitaMall Xizhimen, CapitaMall Wangjing, CapitaMall Grand Canyon, CapitaMall Shuangjing in Beijing; Rock Square in Guangzhou; CapitaMall Xinnan in Chengdu, Sichuan Province; CapitaMall Qibao in Shanghai; CapitaMall Minzhongleyuan in Wuhan, Hubei Province; CapitaMall Erqi in Zhengzhou, Henan Province; CapitaMall Saihan in Hohhot, Inner Mongolia; and CapitaMall Wuhu in Wuhu, Anhui Province.

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  • CRCT’s 2Q 2018 distributable income rises 10.0%

    CRCT’s 2Q 2018 distributable income rises 10.0%

    CapitaLand Retail China Trust Management Limited (CRCTML), the manager of CapitaLand Retail China Trust (CRCT), announced today that it registered distributable income of S$25.7 million for the period 1 April to 30 June 2018 (2Q 2018), an increase of 10.0% from S$23.3 million a year ago.

    The stronger performance was boosted by the first full-quarter contribution of Rock Square. Distribution per unit (DPU) for 2Q 2018 was 2.64 cents on an enlarged unit base, representing an increase of 0.8% from 2.62 cents in 2Q 2017, and 8.2% higher than 2Q 2017’s adjusted DPU of 2.44 cents following CRCT’s private placement exercise in December 20171.

    For the period 1 January to 30 June 2018 (1H 2018), distributable income was S$52.4 million, an increase of 9.8% compared to the same period last year. DPU edged up 0.6% from a year ago to 5.39 cents. On a comparable unit basis1, DPU for 1H 2018 would have been 7.8% higher than 1H 2017’s adjusted DPU of 5.00 cents.

    Based on an annualised DPU of 10.59 cents and CRCT’s closing price of S$1.54 per unit on 26 July 2018, the annualised distribution yield for 2Q 2018 was 6.9%. Unitholders can expect to receive their DPU for 2Q 2018, along with DPU for 1Q 2018, on 20 September 2018.

    Mr Tan Tze Wooi, CEO of CRCTML, said: “We are pleased that our portfolio reconstitution efforts and proactive asset management are showing positive results, delivering a double-digit growth for 2Q 2018’s distributable income. Rental reversions at our core multi-tenanted malls for the quarter averaged a healthy 10.5%, while portfolio occupancy as at 30 June 2018 was resilient at 97.4%.”

    He also added: “Since acquiring Rock Square on 31 January 2018, we have focused on extracting the lease renewal upside while enhancing the mall’s tenant mix. This strategy led to strong rental reversions at Rock Square averaging above 20% for the second consecutive quarter. New entrants in the mall include a digital experience store by Xiaomi and popular beverage store Nayuki Tea. To optimise Rock Square’s layout and further expand its offerings, we created over 500 square metres of retail space by converting unutilised space and adding retail kiosks.”

    In 2Q 2018, CapitaMall Wangjing completed the transformation of the recovered space on Level 4 with 19 of the 23 new retailers opened as at June 2018. r Tan Tze Wooi explained:”the new retail zone, which offers a strong mix of lifestyle and experiential retail tenants that host crowd-pulling events, is expected to drive footfall and improve sales for the entire floor with positive spillovers for the rest of the mall. The early recovery of the former anchor tenant space, executed within timeline and budget, demonstrates our proactive asset management approach to strengthen the appeal of CRCT’s malls.”

    “During the quarter, we early refinanced S$150 million of loans ahead of maturity in 2019 to lock in favourable rates. In addition, we undertook our maiden issue of S$130 million medium term notes (MTN) under CRCT’s S$1 billion MTN programme, which was well-received by debt investors. Diversifying our funding sources to the debt capital market is part of our capital management strategy to harness greater financial flexibility for our next phase of growth as we actively source for strategic acquisitions to expand our portfolio. As at end June 2018, CRCT’s gearing was a healthy 32.1%, well below the regulatory limit of 45%,” he concluded.

  • CapitaLand Retail China Trust property income rises

    CapitaLand Retail China Trust property income rises

    CapitaLand’s China retail venture has had a strong half year, despite the tepid retail sector.

    CapitaLand Retail China Trust Management, which manages CapitaLand Retail China Trust , has achieved net property income of RMB339.3 million (US$50.92 million) for the six months to June 30, up 4.6 per cent from the same period last year.

    Chairman Victor Liew says that with China’s steady growth spurring domestic economic activities, “we continue to be positive on China’s long-term retail growth prospects”.

    CEO Tony Tan says occupancy was steady at 94.9 per cent for the group’s malls for the half-year.

    “We continued to enhance our malls by introducing popular brands and keeping abreast of consumer trends,” he says, citing the opening of the Famiku VR experience centre in CapitaMall Qibao.

    Danish jewellery brand Pandora will soon be opening at CapitaMall Xizhimen, and new F&B brands include Xiao Niu Niu in CapitaMall Xizhimen and Xing Yang Hainanese Chicken Rice in CapitaMall Qibao.

    Meanwhile, CapitaMall Saihan has had its facade upgraded, with similar work almost complete on CapitaMall Wangjing and CapitaMall Qibao to be similarly upgraded this year.

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  • CapitaLand China growth outpaces economy

    CapitaLand China growth outpaces economy

    Singapore-based shopping mall investment company CapitaLand Retail China Trust (CRCT) grew its income last year by 10.3 per cent to S$89.2 million ($63 million) from S$80.9 million.

    With China’s economy growing 6.9 per cent last year, the company’s retail sales drew 10.7 per cent of RMB30.1 trillion ($4.58 trillion), reports CRCTML chairman Victor Liew (CRCTML manages CRCT).

    “China’s slower growth is reflective of an economy undergoing transition, but it is expanding from a much larger base now and its growth is still considerably faster than those of most other economies,” says Liew. “CRCT’s family-oriented shopping malls are well-placed to benefit from China’s growing urban population and rising retail sales as domestic consumption becomes the country’s new growth engine.”

    It was the first time CapitaLand China’s gross revenue had crossed the RMB1-billion mark, says CRCTML CEO Tony Tan. “Portfolio occupancy remained high at 95.1 per cent  as at December 31, while rental reversion for the full year was 8.1 per cent.

    “Annual tenants’ sales increased 11.6 per cent and shopper traffic rose 1.8 per cent year-on-year.

    “We continually refresh our mall offerings to stay relevant to our shoppers’ evolving preferences and needs. For example, CapitaMall Xizhimen (pictured) brought in the popular Jing Ge Steamboat to increase the variety of its F&B offerings, while CapitaMall Qibao introduced a water park.

    “To improve sustainability and the shopping experience, CapitaMall Grand Canyon installed energy-saving LED lights in common areas and upgraded its car park with new flooring.

    “CapitaMall Wangjing is carrying out renovation work to rejuvenate its façade, and is on track to unveil its new look by June.

    “We will continue to strengthen our malls’ tenant mix and uplift the shopping experience through continual asset enhancement initiatives.”

    Gross revenue for the year increased RMB17.5 million, or 1.8 per cent, over the previous year. This was attributed mainly to rental growth from the multi-tenanted malls, partially offset by lower revenue fromCapitaMall Minzhongleyuan, which was impacted by road closure for the building of a subway line, and from CapitaMall Wuhu, where tenancy adjustments are being introduced to achieve stronger positioning and better trade mix.

    CRCT is the first China shopping mall real estate investment trust (REIT) in Singapore, with a portfolio of 10 malls. Listed in Singapore in 2006, its objective is to establish long-term investments in a diversified portfolio of real estate used primarily for retail in China, Hong Kong and Macau.

    A significant portion of CapitaLand China’s properties’ tenancies comprises major international and domestic retailers such as the Beijing Hualian Group, Carrefour and Wal-Mart. The anchor tenants are complemented by specialty brands such as BreadTalk, Innisfree, KFC, Nanjing Impressions, Nike,Sephora, Starbucks, Uniqlo, Watsons and Zara.

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  • Will escalating China woes derail CRCT’s growth story?

    Will escalating China woes derail CRCT’s growth story?

    It will benefit from increased consumption.

    CapitaLand Retail China Trust is still poised for growth despite China’s slowing economy, according to a report by DBS.

    Although investors are currently fearful of the slowdown in China’s GDP growth, DBS said that RCT should remain well positioned as it should benefit from China’s move towards a consumption-based economy. This trend is illustrated by the 10.7% jump in retail sales for FY15, faster than the overall GDP growth of 6.9%.

    “Going forward, we understand CRCT remains confident of generating positive rental reversions (in the “single-digit range), although lower than the 15-20% achieved over the past few years,” DBS said.

    The lower level of rental reversion is also due to CRCT making a strategic decision to attract certain tenants as part of its constant tenant remixing to sustain the performance of its malls in the long term, DBS noted.

    “CRCT’s earnings have been negatively impacted by the road closures surrounding Minzhongleyuan over the past two years. As these works are scheduled to be completed by end-2016, we believe we are approaching an inflection point for the mall’s earnings,” the report added.

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