Broker: CGS International
Date of Report: August 5, 2025
CapitaLand Integrated Commercial Trust Delivers Solid 1H25 Results and Expands Singapore Portfolio with CapitaSpring Acquisition
Overview: Robust Performance and Strategic Acquisition Drive Growth
CapitaLand Integrated Commercial Trust (CICT), Singapore’s leading retail and office REIT, reported an in-line 1H25 performance and announced a transformative acquisition of the remaining 55% stake in CapitaSpring. The trust continues to demonstrate strong operational execution, resilience across its diversified portfolio, and a commitment to sustainability, positioning itself as a core holding for REIT investors.
1H25 Financial Results: Growth Across Key Metrics
- Distributable Income: S\$411.9 million, up 12.4% year-on-year, supported by contributions from ION Orchard and lower interest expense.
- DPU: 5.62 Singapore cents, representing a 3.5% increase year-on-year and achieving 50.6% of FY25 forecast.
- Revenue: S\$787.6 million (-0.5% yoy), Net Property Income (NPI): S\$579.9 million (-0.4% yoy), reflecting the disposal of 21 Collyer Quay. Like-for-like revenue and NPI rose 1.4% and 1.7% respectively.
- Aggregate Leverage: 37.9% as at end-1H25; all-in debt cost averaged 3.4%.
- Portfolio Occupancy: 96.3% overall, with retail at 98.6%, office at 94.6%, and integrated developments at 97.8%.
- Rental Reversions: Retail +7.7%, Office +4.8%.
Operational Highlights: Resilient Performance in Retail and Office Segments
- Retail Leasing: 290,100 sq ft renewed in 2Q25, including 16.3% new leases in F&B, fashion, accessories, digital, and appliance sectors.
- Rental Reversion: Suburban malls led with +8.8% rental reversion in 1H25.
- Shopper Traffic: Up 3.4% year-on-year (excluding ION Orchard impact), though tenant sales slipped marginally by 0.2%.
- Asset Enhancement Initiatives (AEI): Completed at IMM Building; upcoming AEIs at Tampines Mall (S\$24 million project from 4Q25F to 3Q26F to refresh main entrance and tenant mix) and Lot One Shoppers Mall (adding 15,000 sq ft lettable area by converting carpark spaces from 4Q25F to 1Q27F). Both AEIs are expected to yield ROI above 7%.
- Office Leasing: 114,700 sq ft leased in 2Q25, with new demand from consultancy, energy & resources, and IT & telecom sectors. Contributions from Gallileo (post-AEI) expected to boost office rental income from FY26F.
CapitaSpring Acquisition: Strengthening the Singapore Core
- Acquisition Details: CICT to acquire the remaining 55% stake in CapitaSpring, a prime office tower, for S\$1.045 billion, bringing total ownership to 100%.
- Property Value: S\$1.9 billion; 673,300 sq ft of office and retail space with 99.9% committed occupancy as of June 2025.
- Financial Impact: Expected to boost pro forma 1H25 DPU by 1.1% and increase gearing by 0.4 percentage points to 38.3%.
- Funding: At least S\$500 million to be raised via private placement.
- Post-Acquisition Portfolio: AUM to reach S\$27 billion, with 95% of assets in Singapore.
REIT Peer Comparison: CICT in the S-REIT Landscape
| REIT |
Ticker |
Rec. |
Price (LC) |
Target Price (LC) |
Mkt Cap (US\$m) |
Asset Leverage |
Last NAV |
P/NAV |
Dividend Yield FY25F |
Dividend Yield FY26F |
Dividend Yield FY27F |
| CapitaLand Integrated Commercial |
CICT SP |
Add |
2.24 |
2.45 |
12,735 |
37.9% |
2.13 |
1.05 |
5.0% |
5.3% |
5.5% |
| Frasers Centrepoint Trust |
FCT SP |
Add |
2.23 |
2.70 |
3,516 |
42.8% |
2.22 |
1.00 |
5.5% |
5.6% |
5.8% |
| Lendlease Global Commercial REIT |
LREIT SP |
Add |
0.57 |
0.69 |
1,074 |
42.6% |
0.75 |
0.75 |
7.0% |
7.0% |
7.1% |
| Mapletree Pan Asia Commercial Trust |
MPACT SP |
Add |
1.32 |
1.48 |
5,406 |
37.9% |
1.74 |
0.76 |
6.1% |
6.3% |
6.4% |
| Starhill Global REIT |
SGREIT SP |
Add |
0.55 |
0.60 |
982 |
36.2% |
0.69 |
0.80 |
6.6% |
6.7% |
6.7% |
CICT’s dividend yield and leverage remain competitive, underlining its position as a stable, Singapore-focused REIT with strong retail and office exposure.
Financial Summary: 2023-2027 Projections
| Year |
Gross Property Revenue (S\$m) |
Net Property Income (S\$m) |
Net Profit (S\$m) |
Distributable Profit (S\$m) |
DPS (S\$) |
Dividend Yield |
Asset Leverage |
BVPS (S\$) |
P/BV (x) |
Recurring ROE |
| Dec-23A |
1,560 |
1,116 |
815.3 |
715.7 |
0.11 |
4.80% |
38.3% |
2.15 |
1.04 |
4.90% |
| Dec-24A |
1,586 |
1,153 |
924.2 |
752.2 |
0.11 |
4.86% |
35.1% |
2.15 |
1.04 |
5.12% |
| Dec-25F |
1,653 |
1,212 |
789.5 |
814.6 |
0.11 |
4.96% |
35.3% |
2.16 |
1.04 |
5.01% |
| Dec-26F |
1,735 |
1,268 |
844.3 |
865.4 |
0.12 |
5.25% |
35.5% |
2.15 |
1.04 |
5.35% |
| Dec-27F |
1,791 |
1,312 |
889.8 |
907.5 |
0.12 |
5.49% |
35.5% |
2.14 |
1.05 |
5.64% |
ESG Performance: Sustainability as a Strategic Differentiator
- LSEG ESG Score (2023): B overall (Environmental: B+, Social: C, Governance: B+), A+ for ESG controversies.
- GRESB 2023: Maintained 5-star rating and ‘A’ for public disclosure.
- Decarbonisation Targets: Net Zero by 2050; reduce carbon/energy/water intensity by 72%/15%/15% by 2030 (base year 2019).
- Green Initiatives: 99% of portfolio by GFA certified at least BCA Green Mark or equivalent; over 90% of Singapore properties by NLA have adopted green leases.
- Other Highlights: 10% reduction in absolute scope 1 & 2 GHG emissions and 19% lower carbon emissions (vs. 2019 baseline); energy and water consumption intensity reduced by 15%.
CICT’s ESG leadership is expected to become increasingly important for discerning investors, even though no explicit valuation premium has been applied.
Sector-Wide Peer Analysis: Office, Industrial, Hospitality, and Overseas-Centric REITs
The report provides comprehensive peer comparisons across major S-REIT sectors:
- Hospitality: CapitaLand Ascott Trust (6.8–7.0% yield), CDL Hospitality Trust (5.3–6.5% yield), Far East Hospitality Trust, Frasers Hospitality Trust.
- Industrial: CapitaLand Ascendas REIT (5.5–6.0% yield), ESR-REIT (7.8–8.2% yield), Mapletree Industrial Trust, Mapletree Logistics Trust, Keppel DC REIT, Frasers Logistics & Commercial Trust, AIMS AMP, Stoneweg Europe Stapled Trust.
- Office: Keppel REIT, OUE REIT, Suntec REIT (5.3–7.5% yield across the segment).
- Retail (see table above): CICT, Frasers Centrepoint Trust, Lendlease Global Commercial REIT, Mapletree Pan Asia Commercial Trust, Starhill Global REIT.
- Overseas-Centric: CapitaLand China Trust (7.7–8.0% yield), Elite UK REIT (8.5–8.7%), Manulife US REIT (0–49.2%), Sasseur REIT (9.1–9.8%).
- Healthcare: Parkway Life REIT (3.8–4.3% yield).
Balance Sheet and Key Financial Ratios
- Total Investments (Dec-25F): S\$25,350 million
- Total Non-Current Assets (Dec-25F): S\$25,485 million
- Total Current Assets (Dec-25F): S\$227 million
- Total Current Liabilities (Dec-25F): S\$1,510 million
- Long-Term Borrowings (Dec-25F): S\$8,032 million
- Shareholders’ Equity (Dec-25F): S\$15,800 million
- Key Ratios: NPI Margin 73.3% (2025F), DPS Growth 2.20% (2025F), Gross Interest Cover 3.13 (2025F), Effective Tax Rate 2.13% (2025F), Current Ratio 0.15 (2025F), Return on Average Assets 3.08% (2025F), Occupancy Rate 99.4% (2025F).
Conclusion: Investment Outlook and Rating
CGS International reiterates an “Add” rating for CICT with an unchanged DDM-based target price of S\$2.45, representing a 9.4% upside from the current price of S\$2.24. The trust’s diversified portfolio, exposure to resilient suburban retail, and sturdy balance sheet continue to underpin its appeal. Key catalysts include continued inorganic growth, robust occupancy, and sustained rental reversions. Risks include slower-than-expected rental recovery and potential AEI cost overruns.
With strong financials, proactive asset management, and a clear sustainability agenda, CICT remains well-positioned to deliver value for investors, maintaining its status as a bellwether in Singapore’s REIT sector.
