Morningstar | C61U Updated Forecasts and Estimates from 18 Jul 2019
CapitaLand Commercial Trust is a commercial real estate investment trust with properties valued at about SGD 10.5 billion, predominantly located in Singapore’s central business district. Office space in the CBD makes up 48% of the city-state's 57.2 million square feet of total office stock, and CCT's offices make up around a fourth of the 27.6 million square feet in CBD office space. The prime assets are located close to mass transport and in close proximity to other businesses, resulting in nearly full occupancy across the properties. CCT maintained a high 95% occupancy rate even during the 2008-09 economic downturn. While occupancy and rental income could decline as economic conditions weaken, decreased rental could spur tenants to upgrade to prime or grade A properties. We expect CCT's high-quality portfolio to be more resilient than the broader office market in a downturn. The long-term growth initiatives in Singapore, along with its position as a global financial centre (and the main one in the region), underpin demand for prime office space, as do the current favorable economic conditions stemming from an unemployment rate below its historical average. The high occupancy and staggered lease expiry profile reduce rental cyclicality and are conducive to stable distributions to unitholders.CCT has a record of generating value for investors through actively managing and reconstructing its portfolio, as well as asset-enhancement works. The disposal of Wilkie Edge and 50% of One George Street at attractive capitalization yields of 3.4% and 3.2%, respectively, provides CCT with the cash pile to redevelop Golden Shoe and acquire Asia Square Tower 2, which are strategically located in the CBD and offer higher capitalization yield. Over the years, management has taken the initiatives in redeveloping Market Street Car Park into a grade A office building, CapitaGreen, and is currently involved in the redevelopment of Golden Shoe Car Park into an integrated development comprising grade A office, serviced residence, ancillary retail, and a food centre. These strategic redevelopments and acquisitions have significantly enhanced the quality of its portfolio.CapitaCommercial Trust is a commercial real estate investment trust investing in properties predominantly used for commercial purposes. Through its subsidiary, Co. is engaged in the provision of treasury services, including lending to the Trust the proceeds from issuance of notes under an unsecured multicurrency medium term note program. As of Dec 31 2011, Co.'s portfolio comprised of nine properties including three office buildings, one prime office building, three mixed-use properties, one multi-story car park and an ongoing development for a new office tower, all of which are located in Singapore.
Morningstar, Inc. is a leading provider of independent investment research in North America, Europe, Australia, and Asia. The company offer an extensive line of products and services for individual investors, financial advisors, asset managers, and retirement plan providers and sponsors.
Morningstar provides data on approximately 530,000 investment offerings, including stocks, mutual funds, and similar vehicles, along with real-time global market data on more than 18 million equities, indexes, futures, options, commodities, and precious metals, in addition to foreign exchange and Treasury markets. Morningstar also offers investment management services through its investment advisory subsidiaries and had approximately $185 billion in assets under advisement and management as of June 30, 2016.
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