CapitaLand Mall Trust (CMT) and CapitaLand Commercial Trust (CCT) jointly announced the merger plan to create a diversified commercial real estate investment trust (REIT) to be named “CapitaLand Integrated Commercial Trust” (CICT).
With the proposed merger, CapitaLand Group will have three real estate investment trusts listed on the Singapore Exchange (S-REIT), with global or developed market mandates, namely: CICT, Ascendas Real Estate Investment Trust (Ascendas Reit) and Ascott Residence Trust (ART).
According to a statement, CapitaLand Integrated Commercial Trust CICT is expected to be the third largest REIT in Asia Pacific (APAC) and the largest REIT in Singapore, with a market capitalisation of S$16.8 billion and a combined property value of S$22.9 billion.
“CapitaLand believes that this merger, integrating CMT’s retail portfolio with CCT’s office portfolio, is strategically compelling and timely. This merger, upon completion, will offer investors the options to invest in three global, developed market platforms in our core asset classes, and in three specialist emerging market platforms, to suit their specific preferences and risk appetite. CapitaLand is delighted to see CICT’s elevation to a top three APAC REIT by market capitalisation. Together with Ascendas Reit which is ranked eighth largest in APAC, we are proud to be playing a key role in raising the profile of Singapore as the preferred listing destination for REITs, at the same time offering global investors similar scale and liquidity on par with the largest REITs in the APAC region,” said Lee Chee Koon, Group CEO of CapitaLand Group.
“CICT’s enlarged scale and enhanced resilience will appeal to investors who want to invest in the largest proxy REIT for best-in-class Singapore commercial real estate. CICT will have the ability to supercharge its growth further with bigger-sized acquisitions – which can include undervalued opportunities in Singapore as well as accretive investments in other developed markets. We see more of such opportunities within CMT and CCT’s existing portfolios. The merger would allow these and other market opportunities to be pursued more efficiently. Alongside other unitholders, CapitaLand stands to benefit from the value of our stake in CICT while retaining the possibility to co-participate in the developments directly, where appropriate. It will be a strong demonstration of CapitaLand’s two-pronged strategy of growing via development profits as well as recurring income through our fund management platform,” said Jonathan Yap, President, CapitaLand Financial, CapitaLand Group.
The proposed merger is subject to the approval by the unitholders of CMT and CCT at extraordinary general meetings to be convened by CMT and CCT respectively, as well as regulatory and other third-party approvals.
CapitaLand is currently ranked as the ninth largest real estate investment manager globally and top in Asia. The total market value of CapitaLand, including the various listed entities within the Group, is over S$57 billion. CapitaLand is also active in private fund management business. Several private funds were created over the last 12 months, contributing to the S$23.8 billion6 of private fund asset under management currently.