Paragon is being acquired at a net property income yield of 3.9% compared to AST2’s divestment yield of 3%, making the transaction yield accretive. CICT's SGX announcement points to DPU potentially rising to 11.83 cents on a pro forma basis post-divestment of AST2 and acquisition of Paragon, compared to the FY2025 DPU of 11.58 cents. The assumptions for the 11.83 cents DPU (which translates into an accretion of 2.1%) is the issuance of 261.8 million new units priced at $2.292 cents, along with acquisition fees and 50% of management fees paid in units.
CapitaLand Integrated Commercial Trust (CICT), Asia’s largest REIT, has announced the divestment of Asia Square Tower 2 (AST2) to IOI Properties for $2.476 billion, and the acquisition of the freehold Paragon for $3.9 billion. To partly fund Paragon, CICT has announced a placement to raise no less than $600 million.
According to CICT’s press release, AST2 had reached a stable phase in its investment cycle, presenting an opportune window to monetise the asset. The divestment, on an as-is-where-is basis, represents a 9.9% premium to the market valuation of $2.252 million as at Dec 31, 2025. CICT will redeploy the proceeds into the higher yielding Paragon, while preserving balance sheet strength.
