- CapitaLand Integrated Commercial Trust’s proposed acquisition of Paragon, which is to be partly funded by its divestment of Asia Square Tower 2 (AST2), is a positive move. The yield-accretive transaction should strengthen its leading Singapore commercial market positioning and size.
- - Read this at SGinvestors.io -
Swapping leasehold prime office for freehold prime retail.
- See CapitaLand Integrated Commercial Trust's announcements dated 20 Apr – it will be purchasing 100% freehold interest in Paragon (100% occupancy, mixed integrated development) for S$3.9bn or a net yield of 3.9% (retail: 4.1%, medical/office: 3.4%).
- - Read this at SGinvestors.io -
- Paragon, which was part of Paragon REIT (SGX:SK6U) (privatised last year), was indicated to have a high asset capex requirement of S$300- 600m. However, CapitaLand Integrated Commercial Trust said it has not committed to any capex at this stage and will revaluate and conduct phased asset enhancements with limited overall DPU impact to strengthen the mall’s position. There is also rent-reversion upside (currently double-digit rent reversions) and an uplift in rents for medical suites, due to favourable demand-supply dynamics.
Divesting Asia Square Tower 2 for ~S$2.5bn
- Read more at SGinvestors.io.
