CapitaLand China retail restructure paying off, says CEO
CapitaLand China is reporting solid gains from the reconstitution of its Mainland China retail portfolio.
Tan Tze Wooi, CEO of CapitaLand Retail China Trust Management (CRCTML), says proactive asset management drove double-digit growth in the second quarter’s distributable income, up 10 per cent at S$25.7 million (US$18.85 million) for the three months to June 30.
“Rental reversions at our core multi-tenanted malls for the quarter averaged a healthy 10.5 per cent, while portfolio occupancy as at June 30 was resilient at 97.4 per cent.”
He said that since CRCTML acquired the Rock Square property on January 31, the trust has focused on extracting the lease renewal upside while enhancing the mall’s tenant mix.
“This strategy led to strong rental reversions at Rock Square averaging above 20 per cent for the second consecutive quarter. New entrants in the mall include a digital experience store by Xiaomi and popular beverage store Nayuki Tea. To optimise Rock Square’s layout and further expand its offerings, we created more than 500sqm of retail space by converting unused space and adding retail kiosks.”
Meanwhile, CapitaMall Wangjing completed the transformation of recovered space on level 4, with 19 of the 23 new retailers opened as at the end of June.
“The new retail zone, which offers a strong mix of lifestyle and experiential retail tenants that host crowd-pulling events, is expected to drive footfall and improve sales for the entire floor with positive spillovers for the rest of the mall,” said Wooi. “The early recovery of the former anchor tenant space, executed within timeline and budget, demonstrates our proactive asset management approach to strengthen the appeal of CRCT’s malls.”
CRCT is the first China shopping mall Real Estate Investment Trust (REIT) in Singapore, with a portfolio of 11 income-producing shopping malls, located in eight of China’s cities. The properties are CapitaMall Xizhimen, CapitaMall Wangjing, CapitaMall Grand Canyon, CapitaMall Shuangjing in Beijing; Rock Square in Guangzhou; CapitaMall Xinnan in Chengdu, Sichuan Province; CapitaMall Qibao in Shanghai; CapitaMall Minzhongleyuan in Wuhan, Hubei Province; CapitaMall Erqi in Zhengzhou, Henan Province; CapitaMall Saihan in Hohhot, Inner Mongolia; and CapitaMall Wuhu in Wuhu, Anhui Province.