Photo: The Edge Singapore

In its 1Q business update released on May 19, City Developments Limited (CDL) has reported a 15.7 percentage point drop y-o-y to 36.8% in global occupancy for the 1QFY2021, down from the 52.5% reported in the 1QFY2020 for its hotel operations segment.

1QFY2021 global revenue per average room (RevPAR) fell 51.7% y-o-y to $44.60 from the previous year’s $92.40.

The hospitality sector’s recovery has been impacted by the ongoing restrictions on international travel and the resurgence of Covid-19 cases during the quarter.

The group says its Singapore portfolio will continue to face challenges in 2021 till border restrictions are lifted. This is, however, mitigated by government quarantine business as well as demand from domestic staycations.

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In Singapore, portfolio occupancy for CDL’s hotels stood 16.2 percentage points higher y-o-y at 70.6%, although RevPAR declined 29.9% y-o-y to $72.60.

CDL’s UK portfolio was “severely impacted”, particularly in London as its third national lockdown in January forced hotels to remain closed.


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The group adds that it remains hopeful in the market’s recovery prospects as the UK is leading the vaccine rollout in Europe. The country’s lockdown is expected to end in the 2QFY2021.

CDL’s hotels in New York and in the US achieved stronger occupancies in 1QFY2021, particularly with the “weekend business”. The group’s M Social New York property in Times Square is expected to open in 2QFY2021.

On its hotel portfolio, CDL says it “remains focused on cost containment, operational efficiency and digital marketing strategies to reduce cash burn and drive domestic demand”.

The group’s property development saw 319 units sold with a total sales value of $513.6 million through its joint venture (JV) associates in the 1QFY2021.

The figure represents a 72% increase from the 185 units sold in the 1QFY2020 with a total sales value of $278.1 million.

The sales, according to CDL, were spread out among the various property categories from executive condominiums to luxury apartments.

Amber Park, in particular, performed strongly with 100 units sold.

The Tapestry at Tampines Avenue 10, which is fully sold, has obtained its temporary occupation permit (TOP) in February.

While construction activities have resumed at all ongoing development projects, CDL says activities have not returned to pre-Covid-19 levels due to the labour shortage.

The group does not have any projects due for completion this year.

Current projects under construction are scheduled to be completed from mid-2022 to 2023.

CDL launched the 540-unit Irwell Hill Residences at an average selling price (ASP) of $2,700 per sq ft. The launch weekend saw over 50% of the project sold. As at May 19, 60% of the projects – or 324 units – have already been sold.

On May 5, CDL and its JV partner, MCL Land, were awarded a site at Northumberland Road for its top bid of $445.9 million or $1,129 per sq ft per plot ratio through the first government land sales (GLS) tender for 2021.

In Australia, Marker in Melbourne has pre-sold 80% of its 198 units and construction is on track to complete in 2022.

Brickworks Park in Brisbane has achieved pre-sales of 44% of the 132 released units.

Waterbrook Bowral in New South Wales has pre-sold 92% of the 77 townhouses launched. Construction is in progress for the project.

CDL says its committed occupancy for its Singapore office portfolio remains “resilient” at 91.4% as at end-March.

The figure is above the island-wide occupancy of 88.1%.

CDL, for the 1QFY2021, has reported positive rental reversion as average expiring rents are still below market levels.

The portfolio is supported by medium- to long-term leases with a diversified pool of mainly blue-chip multi-national corporations.

CDL’s retail portfolio continues to face headwinds due to the tighter restrictions imposed by the Singapore government on the back of a new wave of Covid-19 infections.

Footfall for its malls during the quarter has been “relatively stable” though it remains lower than pre-Covid-19 levels still.

Gross turnover sales (GTO) for the group’s malls remain strong, with GTO seeing an increase of over 5% compared to levels posted in the 1QFY2020.

As at March 31, CDL’s committed occupancy for retail space stands at 92.1%.


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In Thailand, the group’s major retail mall in Phuket, Jungceylon, has been closed temporarily to reduce operational cost.

The local government had planned to vaccinate at least 70% of its population by July.

The group says it will prepare for the reopening of Jungceylon once the situation improves.

In China and Japan, office leasing enquiries for the group’s portfolio has increased in the quarter as leasing demand gradually returns.

In Suzhou, Hong Leong City Center’s Grade A office tower is now 85% occupied. CDL’s residential rental apartment portfolio within Osaka and Yokaham continues to show “stable occupancy and healthy leasing demand”.

As at March 31, CDL’s net gearing ratio stood at 65% with interest cover at 7.7 times.

The group has cash reserves of $3.4 billion.

The group adds that its China JV, Sincere Property Group, continues to face liquidity challenges. Sincere Property is said to be looking to “speed up its collections, asset sales and divestment on non-strategic projects to raise funds”, but the situation currently remains “fluid”.

Looking ahead, the outlook for 2021 remains “unpredictable” as the Covid-19 situation evolves, says the group.

Amid its enhanced digitalisation initiatives from the onset of the Covid-19 pandemic in 2020, the group says it is “well-prepared to navigate the latest restrictions with agility and manage the ongoing and inevitable business disruptions across its operations”.

With that, it remains cautiously optimistic on the situation with the acceleration of the global Covid-19 vaccine rollout and efforts in the containment of the pandemic.

As at 3.23pm, shares in CDL are trading 15 cents lower or 2.0% down at $7.38.