CapitaLand Integrated Commercial Trust - UOB Kay Hian 2024-10-04: Increasing Dominance Of Singapore’s Retail Scene

• We raise our 2025 DPU forecast for CapitaLand Integrated Commercial Trust by 6% due to contribution from ION Orchard, expansion in NPI margin and lower interest rates.
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Iconic ION Orchard strengthens CICT’s retail portfolio.

• CapitaLand Integrated Commercial Trust (CICT, SGX:C38U) has entered into an agreement to acquire a 50.0% interest in ION Orchard and ION Orchard Link (an underground pedestrian link) from its sponsor CapitaLand Investment (SGX:9CI) at an agreed property value of S$1,848.5m or S$5,928psf.

An iconic premium retail mall that generates high shopper traffic.

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• ION Orchard generates high shopper traffic, including affluent consumers and tourists. It serves the affluent consumers residing in about 20,000 private residential units in District 9, including those staying in the attached 56-storey condominium The Orchard Residences. There are also about 10,000 hotel rooms in the vicinity. Other potential shoppers include tourists visiting Orchard Road, which amounted to about 4.5m in 2023, equivalent to 12,328 tourists per day.

ION Orchard acquired at attractive valuation given its status as a trophy asset at an ultra prime location.

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Jonathan KOH CFA UOB Kay Hian Research | https://research.uobkayhian.com/ 2024-10-04 SGinvestors.io

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