Capitaland Integrated Commercial Trust Is My Best Performing SReit

🌟🌟🌟$CapLand IntCom T(C38U.SI)$  is the largest Singapore Real Estate Investment Trust with a market capitalisation of SGD 13.7 billion or USD 10.3 billion.  It debuted on Singapore Exchange in July 2002 and was renamed CICT in November 2020 following the merger with Capitaland Commercial Trust.

I have invested in Capitaland Commercial Trust in 2021 prior to the merger and have held CICT since then.  In that time I have seen CICT grow slow and steadily. 

What makes CICT so special when other SReits were not doing so well?

First of all, CICT has a strong sponsor in $CapitaLandInvest(9CI.SI)$  which holds properties in over 40 countries.  Capitaland Invest is a leading Singapore real estate investment and management firm.  It has a portfolio of 6 SReits of which CICT is part of the group.  Temasek Holdings is the parent company of Capitaland Invest.

CICT owns and manages 26 properties with 93.7% located in Singapore, 3.6% in Australia and 2.7% in Germany.   Total property value is SGD 24.5 billion or USD 18.4 billion.

These properties are a combination of Integrated Developments such as CapitaSpring, Funan, Plaza Singapura, The Atrium @Orchard and Raffles City.

CICT 's office segment includes Asia Square Tower 2, CapitaGreen, Capital Tower, CapitaSky (70% interest), Six Battery Road and 21 Collyer Quay

Under Retail Segment, CICT owns and manages Bedok Mall, Bugis Junction, CQ@ Clarke Quay, IMM Building, Junction 8, Lot One Shoppers Mall, Tampines Mall, Westgate, Bugis+ and Bujit Panjang Plaza.

In Australia, CICT owns and manages 3 properties located in Sydney and 2 properties in Frankfurt Germany. 

Today CICT has just announced that it plans to acquire 50% of ION Orchard at SGD  1.85 billion.  The Distribution per unit (DPU) accretion after acquisition is expected  to be 0.9%.

CICT plans to raise SGD 1.1 billion to pay for ION from a combination of a placement and a preferential offer to unitholders.  The proposed acquisition will be subject to the approval of CICT's unitholders at an EGM to be convened. 

CICT's 1st Half Financial Year ended 2024 was 5.43 cents, giving an Annualised DPU yield of 5.1%.  Following the acquisition, the proforma leverage moves a little higher to 39.9%.

CICT's Gross Revenue grew 2.2% year on year in 1H24.  This is due to higher rental income, despite absence of income from Gallileo in Frankfurt which is currently undergoing an Asset Enhancement Initiative (AEI) since February 24.

Net Property Income for 1H24 increased 5.4% year on year due to lower utility expenses and savings from the new property management agreement.

CICT retail portfolio achieve positive rent reversion of 9.3% based on average rent of signed leases in 1H24.  Occupancy went up to 99% in 2Q24.  Tenant retention was healthy at 85.7%.

CICT office portfolio achieved positive rent reversion of 15% based on the average rent of signed leases in 1H24.  Occupancy was stable at 95.3% in 2Q24.

Performance wise, CICT had recently reached its All Time High in August at SGD 2.16.  

CICT is rated A- by Standard & Poor and A3 by Moody's.  5 Financial Analysts have rated CICT as a Buy, with Target price of SGD 2.30, an upside potential of 8%.

CICT is part of $STI ETF(ES3.SI)$  Top 10 holdings.  I believe that it is one of the best SReits to invest as it has a diversified portfolio of properties to generate a steady DPU and an excellent management team.   CICT also has a strong sponsor in Capitaland Invest.

Tiger Brokers are currently having a National Day Special where there is zero commission and a competition where there are 100 prizes to be won.  These include Staycation, stock vouchers and much more.  I think this is a great time to buy more$CapLand IntCom T(C38U.SI)$  shares.

Go Long Go Strong Go CICT! 

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