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It will have a 100 percent interest in CapitaMall Xuefu, CapitaMall Aidemengdun in Harbin and CapitaMall Yuhuating in Changsha.
CapitaLand Retail China Trust (CRCT) is acquiring three shopping malls in China for RMB2.96 billion (S$589.2 million).
This comes after it entered into an agreement with a subsidiary and associated companies of CapitaLand to acquire 100 percent interests in three companies that own CapitaMall Xuefu, CapitaMall Aidemengdun in Harbin and CapitaMall Yuhuating in Changsha.
Subject to post-completion adjustments, CRCT’s total acquisition outlay stands at around $505.4 million. It plans to finance the proposed acquisition through a combination of debt and equity with an objective to achieve accretion.
CRCT noted that the accretive acquisition will diversify its footprint in China to 10 cities from eight, as well as allow it to gain exposure to two rising provincial capital cities – namely Changsha in Hunan Province and Harbin in Heilongjiang Province.
With a total gross floor area (GFA) of 248,282 sq m, the three malls are expected to expand CRCT’s portfolio GFA by 30.7 percent as well as boost the number of leases within its portfolio by 52 percent.
The three malls’ 99 percent occupancy is well above the market average, mirroring their popularity among retailers.
“Located near transportation hubs and serving large population catchments, CapitaMall Xuefu, CapitaMall Aidemengdun and CapitaMall Yuhuating are quality and mature assets that registered CAGR of 6.5 percent, 8.7 percent and 6.3 percent in tenants’ sales between 2016 and 2018 respectively,” said Tan Tze Wooi, chief executive officer of CapitaLand Retail China Trust Management.
Post-acquisition, CRCT’s enlarged portfolio will comprise 14 shopping malls, up from the current 11. Its portfolio size will also grow by around 18.6 percent to $3.8 billion, while NPI will increase 22.8 percent to RMB959.3 million ($189 million) on a pro forma basis.
Conditional upon the approval of CRCT unitholders, the transaction is expected to be completed in the third quarter of 2019.
Victor Kang, Digital Content Specialist at PropertyGuru, edited this story. To contact him about this or other stories, email victorkang@propertyguru.com.sg
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