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CDL reports high occupancies for Singapore office, recovery in retail and hotel portfolios

The Edge Singapore
The Edge Singapore 11/30/2022 08:16 PM GMT+08  • 3 min read
CDL reports high occupancies for Singapore office, recovery in retail and hotel portfolios
Artist's impression of Copen Grand
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In a business update, City Developments (CDL) says that the group along with its joint venture associates sold 95 units valued at $281 million in 3Q2022. Sales were slower for the quarter as the company has a low inventory of unsold units.

For the nine months to Sept 30, 2022, CDL sold 802 units valued at $1.9 billion, which was lower than the 1,382 units valued at $2.5 billion for the same period a year ago. This is because most of its launched projects have been substantially sold, with Sengkang Grand Residences selling out in the third quarter.

After 3Q2022, CDL launched Copen Grand Executive Condominium (in Oct). It is currently fully sold. Hence, since Sept 30 to Nov 30, the group has sold 1,417 units valued at $2.8 billion.

The company replenished its landbank with a successful bid of $336.07 million for a 178,936 sq ft EC site at Bukit Batok West Avenue 5 The EC project will comprise 10 blocks of 12 to 13 storeys with around 512 units.

In Australia, CDL recently completedThe Marker in Melbourne, where 84% of the 198 units have been sold to date. The purchase of its first Private Rented Sector (PRS) development site in Melbourne’s Southbank was completed in November 2022. Project construction is targeted to commence in 2Q2023 and will yield around 240 units.

CDL’s office portfolio had a committed occupancy 94.3% as at Sept 30; Republic Plaza, the Group’s flagship Grade A office building, is 96.1% committed with a positive rental reversion of 5.9%.

See also: Sabana Industrial REIT reports 7.0% y-o-y drop in 2HFY2022 DPU of 1.46 cents

The property group’s retail portfolio had a committed occupancy of 95.3% as at Sept 30. City Square Mall and Palais Renaissance had committed occupancies of 98.2% and 100% respectively. The retail portfolio’s average monthly footfall has recovered to 70% of pre-Covid levels in 3Q2022, while average monthly tenant sales have already exceeded pre-Covid levels.

The CDL statement said its two office buildings 125 Old Broad Street and Aldgate House benefitted from the stability of London’s office leasing market. Leasing of The Junction, a 665-unit PRS development in Leeds, has begun and is scheduled to complete in the current quarter.

Meanwhile, the group’s PRS portfolio in Osaka and Yokohama have average occupancy of above 95%.

See also: CDLHT reports 2HFY2022 DPS of 3.59 cents, up by 17.3% y-o-y

CDL’s hotel portfolio has rebounded, with Revenue Per Available Room (RevPAR) growth of 88.9% y-o-y to $161.9. For the nine months to Sept 30, RevPAR for the portfolio rose 108.3% to $127.7, with London and New York improving their RevPAR by 291.2% and 113.3% respectively.

The rate hike cycle has caused CDL to postpone the IPO of its UK commercial REIT. “The unprecedented interest rate hikes in 2022 have severely impacted the IPO of REITs in Singapore, with several planned IPOs and secondary fund-raising exercises of REITs withdrawn. Amid this challenging market, the Group is placing a temporary pause on its IPO aspirations for its UK commercial properties until the market stabilises,” the statement read.

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