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CapitaLand Commercial Trust (CCT) saw its distribution per unit (DPU) increase by 10.1 percent to 2.39 cents in Q4 2016 from 2.17 cents in Q4 2015.
Gross revenue jumped 32.7 percent to $89.7 million, while net property income rose by 35.4 percent to $70.8 million, on the back of contributions from CapitaGreen (pictured), which became a wholly-owned property of the trust. This comes after CCT completed its acquisition of the remaining 60 percent interest in MSO Trust that owns CapitaGreen on 31 August 2016.
CCT’s investment properties, including its joint venture interest in Raffles City Singapore, is worth $8.49 billion as at 31 December 2016, according to independent valuers. This represents a 13.6 percent year-on-year increase in portfolio value, primarily due to the increased stake in MSO Trust.
The trust’s portfolio occupancy rate remained resilient at 97.1 percent as at 31 December 2016, driven by the expansion of existing tenants and take-up by new tenants.
CCT signed around 733,000 sq ft of new leases and renewals during the 2016 financial year.
“About half of 2017 leases have been renewed, and we will continue to proactively attract and retain tenants to mitigate leasing risk,” said Lynette Leong, CEO of the trust’s manager.
She revealed that the trust does not expect to be significantly affected by rising interest rates, considering that around 80 percent of CCT’s borrowings are on fixed interest rates and that it has minimal debt due for refinancing in 2017.
“Beyond the current challenging market conditions, we are looking at the next wave of the office market upcycle as well as “the future of work” – that is, how the way people work will possibly evolve in the future given the trend of globalisation, mobility and digital technology – and incorporate that in our evaluation of the financial feasibility of the redevelopment of Golden Shoe Car Park, while seeking approvals from the government authorities.
“Our wish is to replicate the success of CapitaGreen so as to spark a new growth catalyst for the trust,” she said.
Image source: CapitaLand
Romesh Navaratnarajah, Senior Editor at PropertyGuru, edited this story. To contact him about this or other stories, email romesh@propertyguru.com.sg
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