CapitaLand China Trust (CLCT) has reported gross revenue of RMB478.8 million ($89.6 million) for the 3QFY2023 ended Sept 30, 1.9% lower y-o-y. The decline was attributed to the closure of CapitaMall Qibao and rent provisions made at CapitaMall Shuangjing.
Net property income (NPI) for the period rose by 1.2% y-o-y to RMB316.4 million driven by the recovery in CLCT’s retail portfolio. NPI of its overall retail portfolio increased by 4.7% y-o-y. Excluding CapitaMall Qibao and CapitaMall Shuangjing in the 3QFY2023, retail NPI would have been up by 13.4% y-o-y.
NPI for CLCT’s new economy portfolio fell by 5.2% y-o-y to RMB102.7.
In Singapore dollar (SGD) terms, total NPI for the 3QFY2023 fell by 8.4% y-o-y to $58.9 million due to the 10.5% y-o-y depreciation of the RMB to SGD.
As at Sept 30, portfolio occupancy stood at 93.1%. Weighted average lease expiry (WALE) stood at 2.0 years by gross rental income (GRI) and 2.9 years by net lettable area (NLA). Shopper traffic increased by 33.0% y-o-y while tenant sales grew by 30.2% y-o-y.
As at Sept 30, gearing stood at 42.4%, 2.2 percentage points higher q-o-q while adjusted interest coverage ratio (ICR) stood at 3.0x, lower than the 3.2x the quarter before.
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Looking ahead, CLCT is buoyant on the prospects of its retail portfolio as it is poised to ride the recovery of domestic consumption in China. The REIT has also planned asset enhancement initiatives (AEIs) across its multiple assets.
The REIT adds that it will strengthen weaker malls that are typically smaller in size and contribution, while seeking divestment of mature retail assets.
For its business park portfolio, CLCT sees that things are stabilising within China thanks to recent government interventions and policy stimuli despite a conservative business outlook. It seeks to “actively refine asset-specific leasing strategies” for this particular portion of its portfolio.
CLCT has also said that it will balance tenant retention and occupancy for its logistics park portfolio while it sees Shanghai logistics vacancy elevated over the short term on the back of continued supply pressure.
Units in CLCT closed 0.5 cents lower or 0.62% down at 80 cents on Oct 26.
