City Developments Limited (CDL) Q3 2025 Operational Update: In-Depth Analysis for Investors

Key Highlights and Financially Material Developments

Property Development – Singapore

• Sales Performance: CDL and joint venture associates sold 88 units with a total sales value of \$313.2 million in Q3 2025, a significant drop from 321 units with \$611.1 million sales in Q3 2024 due to the absence of new launches this quarter. The previous period benefitted from the launch of Kassia, which saw robust demand.
• Year-to-Date Sales: For the first nine months of 2025, the Group sold 990 units totaling \$2.5 billion, outperforming 9M 2024 (905 units, \$1.8 billion). This was largely driven by the successful launch of The Orie JV project at Toa Payoh, with 94% sold (730 units).
• Project Updates: Piccadilly Grand, a fully-sold JV project at Farrer Park, obtained TOP in September. Handover to buyers has commenced, with integrated retail and amenities enhancing appeal.
• Land Acquisition & Pipeline Expansion: CDL has replenished its land bank, securing the Lakeside Drive GLS site in Jurong and two Executive Condominium (EC) GLS sites in Woodlands and Senja Close. These acquisitions will add over 700 units, with previous EC launches fully sold, positioning CDL strongly in this segment.
• New Launches: In October, the Zyon Grand luxury project (706 units, JV with Mitsui Fudosan) launched with 84% sold on opening weekend at an average \$3,050 psf. Two penthouses exceeded \$10 million each, with a buyer base dominated by Singaporeans (84%) and PRs (14%) from across Asia.

Property Development – Overseas

• Australia: Brickworks Park (Brisbane) Stage 1 is fully sold and complete; Stage 2 (51 units) completes Q1 2026. 92% of launched units are sold; Stage 3 secured town planning approval.
• China: 120 units sold YTD for RMB 263.8 million (\$48 million). Hong Leong Larimar Center (Suzhou) targets Phase 1 launch in Q1 2026. Shanghai’s Xintiandi mixed-use project construction starts Q4 2025.

Investment Properties

• Singapore Offices: CDL’s office portfolio achieved a 97.3% committed occupancy, well above the island average (88.8%). Republic Plaza and City House are near full occupancy. The lease expiry profile has been strengthened, enhancing risk management.
• Union Square Central: This large-scale redevelopment in the Central area is on track for 2028 completion, with 52% pre-commitment already secured, indicating robust demand for premium Grade A office space.
• Retail: Retail occupancy stands at 96.9%, beating the market average (93.1%). City Square Mall, Palais Renaissance, and Sengkang Grand Mall deliver strong results post-asset enhancement initiatives.
• UK: Commercial assets in London maintain strong momentum; Aldgate House occupancy expected to jump from 75.8% to 98.2% as leasing progresses. St Katharine Docks stable at 87%. Resilience is supported by prime locations and ongoing enhancements.
• Thailand: Jungceylon Shopping Center in Phuket holds firm at 92% occupancy with a 21% positive rental reversion.
• China: Office portfolio in China remains weak at 58% occupancy, mirroring broader market softness.

The Living Sector: PRS & PBSA

• UK PRS: The Octagon (Birmingham, 370 units) achieved full completion and is now leasing. The Junction (Leeds, 665 units) at 90% occupancy. Additional projects (The Joinery, The Yardhouse) to complete in 2026.
• Japan PRS: 40 assets, 2,246 units, with 95%+ occupancy. Rental growth remains robust, especially in Tokyo and Osaka.
• Australia PRS: The Archive (Melbourne, 237 units) completed, leasing underway.
• UK PBSA (Student Housing): Portfolio at 82% occupancy, reflecting softer demand from foreign students. Leasing initiatives are being accelerated to improve performance.

Hotel Operations

• Global RevPAR: Slight decrease of 0.3%, at \$165.8. Asia saw a 10.6% decline (Singapore impacted by fewer events, increased competition, higher room supply).
• Europe: RevPAR up 3.3%, mainly boosted by Hilton Paris Opéra acquisition. London saw a slight dip; the rest of UK/Europe rose 10.7%. Copthorne Hotel Cardiff renovations caused temporary losses.
• US: RevPAR up 1%, with New York rising 1.9%. Regional US declined in occupancy. Renovations and rising costs impacted profitability.
• Australasia: Strong 11.2% RevPAR growth, boosted by new acquisition in Christchurch.
• Hotel Refurbishments:
  • M Social Resort Penang opened in July post-renovation.
  • Millennium Hotel London Knightsbridge to undergo major AEI in Q4 2025.
  • Millennium Downtown New York renovated and reopened as M Social New York Downtown in October.
  • M Social Hotel Sunnyvale (US) under construction, completion in 2H 2026, total cost US\$118 million.

Capital Position & Fund Management

• Net Gearing: Stands at 69% after significant acquisitions in Shanghai and Jurong, partly offset by divestment proceeds from South Beach integrated project.
• Liquidity: \$2.5 billion in cash, \$4.3 billion total cash and undrawn facilities. Interest cover at 4.0 times; debt expiry profile healthy. No concerns over near-term debt obligations.
• Capital Recycling: Piccadilly Galleria divested for \$65.46 million (\$3,250 psf). Quayside Isle sale launched, EOI closed in October; advanced negotiations ongoing. These moves unlock value, reduce debt, and support shareholder returns.
• Strategic Focus: CDL continues to recycle capital, prioritising redeployment into new opportunities, debt reduction, and value enhancement.

Outlook and Prospects

• Resilient Core Operations: Strong pipeline in Singapore and China, active land replenishment.
• Sustained Investment Property Performance: High occupancy rates and robust tenant demand in Singapore office and retail portfolios.
• Hotel Operations: Stable performance expected. Major Singapore events in Q4 2025 (Formula 1 Grand Prix, Blackpink concert) should boost domestic inflows.
• Market Conditions: Easing interest rates and stabilising market environment expected to support ongoing execution and sustainable long-term value for shareholders.

Potential Price-Sensitive Issues for Shareholders

• Sharp decline in Singapore residential sales in Q3 due to lack of new launches, but strong YTD performance may mitigate concerns.
• High gearing (69%) following major acquisitions could raise concerns about leverage, but robust liquidity and healthy interest cover should reassure investors.
• Successful launch and rapid sales of Zyon Grand and ongoing divestments (Piccadilly Galleria, Quayside Isle) could positively impact share price by unlocking value and improving balance sheet.
• Weakness in the China office portfolio (58% occupancy) and softer student housing demand in the UK may be a drag, but offset by strong performance in other markets.
• Major refurbishments and new developments signal ongoing investment in growth and quality, which could support future valuations.
• Stable outlook, proactive capital management, and strong cash reserves position CDL well for market uncertainties.

Disclaimer

This article is for informational purposes only and does not constitute financial advice or an offer to buy or sell any securities. Investors should conduct their own due diligence and consult with their financial advisers before making investment decisions. The information herein is based on the latest operational update from City Developments Limited as of Q3 2025 and is subject to change without notice.

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