CapitaLand Integrated Commercial Trust (CICT)

Starting a thread on CCT, since there's already one each on KREIT and Suntec.

http://cct.listedcompany.com/newsroom/20...A04D.1.pdf
In their latest quarterly earnings, there's some good read-across for the office property segment.
1. Slide 34: Average rent of remaining leases in 2012 is $8.57 psf, Grade A Office Average Market Rent is $10.10 psf pm
2. Slide 35: Average rent of remaining leases in 2013 is $7.64 psf
3. Slide 35: Average rent of remaining leases in 2014 is $9.69 psf
4. Slide 39: New addition to private office space. See 2013-2016 (below the 1993-2012 average). <1m sq ft in 2013 and 2014
5. Slide 40: Grade A office rent on the decline again
6. Slide 50: NPIs for most of the property inched slightly higher Y-o-Y, except for 6BR.

It suggests that we are seeing the final negative rental reversions in the next 1 or 2 quarters and we should start to see positive rental reversions which should start feeding across to DPUs for the business trusts.
This is contingent on the market rent holding at the >$10 levels or those tresholds shown above. While it is hard to determine the level of demand, the comforting thing is that the new supply is slowing down after all the new buildings in the Marina Bay area.
At the very least, office properties are still sold at very attractive levels. Robinson Point (formerly owned by CCT) is reportedly changing hands at S$2132psf. From CCT's portfolio (slide 8), the valuation of CCT seems quite reasonable against that transacted value. Eg. Capital tower at S$1621 psf. Despite that, Office REITs are still trading at the largest discount to book value among the REITs in Singapore.
I personally prefer CCT for its diversification of properties and tenants though the lower yield is the price I have to pay for that.

Any thoughts on this REIT or office REITs would be most welcome.

[vested]

Office rents ‘set to soar next year’

SINGAPORE — Office rents in Singapore are expected to surge next year after extending a “modest” rebound that started in the second quarter, according to the biggest office trust in Asia outside Japan.

The recovery will be led by companies seeking to set up regional headquarters in Singapore as they face the lowest supply in office space here in two decades, Ms Lynette Leong, Chief Executive of the manager for CapitaCommercial Trust (CCT), said yesterday on Bloomberg TV.

http://www.todayonline.com/business/offi...-next-year

Financial Statement: http://infopub.sgx.com/FileOpen/CCT_3Q13...eID=260179

Press Release: http://infopub.sgx.com/FileOpen/CCT_3Q_2...eID=260180

Quote:

3Q13 Results

CapitaCommercial Trust Management Limited, the Manager of CapitaCommercial Trust (CCT or Trust), is pleased to report a distributable income of S$58.8 million for the financial quarter ended 30 September 2013 (3Q 2013), which was 1.6 per cent more than the S$57.9 million reported in 3Q 2012. This was largely due to lower interest expenses in 3Q 2013 and distribution of tax-exempt 1H 2013 distributable income received from Quill Capita Trust. The estimated distribution per unit (DPU) of 2.041 cents for 3Q 2013, together with the DPU for 4Q 2013, will be paid out in February 2014 as CCT distributes semi-annually. Based on CCT’s closing price per unit of S$1.42 on 17 October 2013, CCT’s distribution yield is 5.7 per cent.

The gross revenue of S$94.9 million in 3Q 2013 was only marginally lower than the S$95.5 million achieved in 3Q 2012. Higher revenue from Six Battery Road and Raffles City Singapore compensated for the lower income contribution from Capital Tower due to its lower occupancy, and for the cessation of yield protection income for One George Street from 10 July 2013. Lower revenue and higher operating expenses resulted in a net property income of S$72.6 million in 3Q 2013, a decrease of 3.5 per cent from S$75.2 million in 3Q 2012. However, the portfolio operating margin was still within the range of 75.0 per cent to 80.0 per cent achieved by CCT in the past.

(not vested)

(18-10-2013, 09:54 PM)mkmk Wrote: Financial Statement: http://infopub.sgx.com/FileOpen/CCT_3Q13...eID=260179

Press Release: http://infopub.sgx.com/FileOpen/CCT_3Q_2...eID=260180

Quote:

3Q13 Results

CapitaCommercial Trust Management Limited, the Manager of CapitaCommercial Trust (CCT or Trust), is pleased to report a distributable income of S$58.8 million for the financial quarter ended 30 September 2013 (3Q 2013), which was 1.6 per cent more than the S$57.9 million reported in 3Q 2012. This was largely due to lower interest expenses in 3Q 2013 and distribution of tax-exempt 1H 2013 distributable income received from Quill Capita Trust. The estimated distribution per unit (DPU) of 2.041 cents for 3Q 2013, together with the DPU for 4Q 2013, will be paid out in February 2014 as CCT distributes semi-annually. Based on CCT’s closing price per unit of S$1.42 on 17 October 2013, CCT’s distribution yield is 5.7 per cent.

The gross revenue of S$94.9 million in 3Q 2013 was only marginally lower than the S$95.5 million achieved in 3Q 2012. Higher revenue from Six Battery Road and Raffles City Singapore compensated for the lower income contribution from Capital Tower due to its lower occupancy, and for the cessation of yield protection income for One George Street from 10 July 2013. Lower revenue and higher operating expenses resulted in a net property income of S$72.6 million in 3Q 2013, a decrease of 3.5 per cent from S$75.2 million in 3Q 2012. However, the portfolio operating margin was still within the range of 75.0 per cent to 80.0 per cent achieved by CCT in the past.

(not vested)

If you like some exposure to the Singapore office market, CCT is the REIT to go for. It has a sizeable portfolio, is well managed, pays a decent dividend and is not over leveraged. It has growth potential via it's sponsor's portfolio, CapitaGreen, Westgate office to name a few.

Higher revenue from most of its properties led CapitaCommercial Trust (CCT) to report a higher distribution per unit for the fourth quarter of last year.

CCT will pay unitholders 2.09 cents for the three months to Dec 31, a 2 per cent rise from the same period a year ago, the trust's manager said on Thursday.

This brings its total distribution for last year to 8.14 cents, up 1.2 per cent from 2012.

Distributable income for the office trust rose 3.3 per cent in the fourth quarter from a year ago to $60.2 million, mainly due to lower interest expenses, CCT said.

Prime office rents rise 5.5% in Q1

Average grade A overall rent hits $9.90 psf; vacancy rate down to 4%
Published on Apr 8, 2014


By Mok Fei Fei

A LACK of new supply and increased demand amid a more upbeat business climate boosted prime office rents in the first quarter, said property consultancy Cushman & Wakefield yesterday.

The average grade A overall rent hit $9.90 per square foot (psf) per month - up 5.5 per cent over the previous quarter and the fourth straight quarter of increases.

It was also up 10.1 per cent on the same period a year ago.

Rents for offices in Raffles Place were the big mover, up about 10 per cent over the previous quarter to $9.90.

Marina Bay rent had the next highest jump - rising 9.3 per cent to an average of $12.90.

Newer buildings in Marina Bay can command even better prices, with average monthly effective rents coming in around $13 to $14 psf.

Cushman & Wakefield reported yesterday that positive market sentiment coupled with a limited supply drove the hike in prime rents.

The tightening of supply and sustained demand also sent the vacancy rate down 0.2 percentage point to 4 per cent for the first quarter.

Raffles Place again benefited the most, with vacancy rates down to 3.1 per cent compared with 4 per cent in the previous quarter.

The vacancy rates for Marina Bay, Shenton Way and Orchard stayed the same.

City Hall, however, saw vacancies rise to 1.2 per cent compared with 0.5 per cent in the previous quarter.

The leasing market also stayed active, with a healthy number of inquiries.

Mr Toby Dodd, Cushman & Wakefield's Singapore head, said: "We expect prime office rents in the CBD area to continue to rise over the next few quarters, supported by a moderate level of new supply this year and positive economic sentiments as the outlook of the global economy improves."

The sustained growth of global economic powerhouses the United States and Japan is also likely to benefit local service sector firms, which often take up large plots of office space.

Cushman & Wakefield expects the financial and insurance, information and communication and business services segments in particular to show continued stable growth and support the high demand.

But it noted that the completion of major office buildings in the later part of this year may weigh on the rents of older blocks.

feimok@sph.com.sg

Office rents here 'may rise fastest in the world this year'
Published on May 26, 2014 1:18 AM



By Melissa Tan

A LACK of office space could drive up rents at a faster pace in Singapore than anywhere else in the world this year, according to a report from property consultancy JLL.

JLL analysts told The Straits Times that skyrocketing rents here could in turn entice foreign funds, particularly those from the United States, to invest in the sector.

Prime office rents in the Central Business District (CBD) could climb by as much as 15 per cent to 16 per cent this year from last year, said JLL's head of research for Singapore and South-east Asia, Dr Chua Yang Liang.

In particular, rents for the newer offices in Marina Bay could increase by 16 per cent to 17 per cent over the same period.

This means that prime offices here are "predicted to top the rental growth league table" this year out of 25 markets worldwide, the report said, edging out major global cities like Dubai, London, New York and San Francisco.

Dr Chua added that rents were expected to shoot up this year due to limited supply, but could ease around 2016 once more office developments are completed.

He said: "Occupiers continue to renew their leases, so that's giving some positive sentiments to landlords... In the short term, there's a mismatch of demand and supply."

JLL Asia-Pacific research head Jane Murray said vacancy rates in Singapore have fallen "quite significantly".

"People were worried about oversupply for a while but it hasn't quite eventuated."

The buoyancy of the office market stands in stark contrast to the residential sector, where prices and rents have been dampened under several rounds of property market curbs.

JLL analysts said the strength of Singapore's office sector could draw interest from foreign investors.

US investors, rather than those from Europe, would likely be keener on Singapore, they said.

"There are a lot of funds from the US that are actively looking," said JLL research head for North and South America Benjamin Breslau.

JLL's head of research for Europe, the Middle East and Africa, Dr Lee Elliott, said investor interest from Europe would probably be less as funds there have many opportunities closer to home.

The size of the Singapore market, however, may deter foreign investment.

"Singapore is a relatively small market so sourcing for opportunities is harder compared to the US and Europe," said Dr Murray.

Mr Breslau added that office blocks here tended to be "relatively tightly held", meaning many owners do not want to sell.

CapitaGreen, a 700,000 sq ft office tower in the CBD, is expected to be completed by the end of this year.

The office components of mixed developments such as South Beach near Raffles Hotel, DUO in Bugis and Marina One in Marina Bay could also be completed within the next few years.

melissat@sph.com.sg

http://www.businesstimes.com.sg/companie...pore-cents

CCT Q3 DPU up 2.9% to 2.10 Singapore cents
Its portfolio committed occupancy rate is at 99.4%, above the market occupancy rate of 96.6%

By
Mindy Tantanmindy@sph.com.sg@MindyTanBT
CCT251014.JPG CAPITACOMMERCIAL Trust's (CCT) distribution per unit (DPU) for the third quarter rose 2.9 per cent, from 2.04 to 2.10 Singapore cents, on the back of a 4.8 per cent jump in distributable income, from S$58.8 million to S$61.6 million. PHOTO: CCT
25 Oct5:50 AM
Singapore

CAPITACOMMERCIAL Trust's (CCT) distribution per unit (DPU) for the third quarter rose 2.9 per cent, from 2.04 to 2.10 Singapore cents, on the back of a 4.8 per cent jump in distributable income, from S$58.8 million to S$61.6 million.

This was computed on the assumption

I have a question, sorry if it sounds stupid:

I notice they pay no tax at all. Are Singapore-based REITs entitled for tax exemption?

Yes, if they distribute at least 90% of the income.

However, tax exemption may expire for foreign income after March 2015.
http://www.kpmg.com/SG/en/SingaporeBudge...40218.html