[SINGAPORE] The manager of CapitaLand China Trust (CLCT) posted a net property income (NPI) of 292.5 million yuan (S$52.8 million) for the first quarter of financial year 2025, down by 6.6 per cent from 313.1 million yuan in the previous corresponding period.
Gross revenue fell 6.1 per cent to 439.7 million yuan for the quarter, from 468.1 million yuan in the year-ago period, amid declines in retail and business park revenue and higher logistics parks revenue.
Lower NPI was driven by the drop in gross revenue but partially offset by savings in operating expenses of 5 per cent year on year for the overall portfolio, the manager said in a Thursday (Apr 24) business update.
Revenue for retail fell 2.7 per cent due to lower rents at CapitaMall Xinnan. The decline would have been slightly greater, at 3.7 per cent, if supermarket upgrading works in CapitaMall Wangjing, CapitaMall Xizhimen and CapitaMall Xuefu were accounted for.
While shopper traffic was up 2.4 per cent year on year, tenant sales at CLCT malls were down 2.4 per cent.
As at Dec 31, 2024, the retail portfolio was CLCT’s largest asset class by gross rental income (GRI), accounting for 71.4 per cent of GRI with a valuation of 17.1 billion yuan.
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It is followed by business parks that make up 25.1 per cent of GRI, with a 5.4 billion yuan valuation, and logistics parks at 3.5 per cent of GRI, with a 1.5 billion yuan valuation.
Business park revenue slipped 9.6 per cent on lower occupancy for some properties. The overall portfolio’s occupancy fell to 83.7 per cent from 90.2 per cent in the year-ago period.
Three out of five business parks in the portfolio recorded lower occupancy on the year. They were the Ascendas Xinsu Portfolio, the Singapore-Hangzhou Science Technology Park Phase II and Ascendas Innovation Towers.
Logistics parks revenue climbed 3.3 per cent, which the manager attributed to higher occupancy at Kunshan Bacheng Logistics Park as the property achieved full occupancy for the quarter, up from 89.7 per cent previously.
The overall logistics portfolio posted an occupancy of 95.7 per cent for Q1, with three of its four logistics parks attaining full occupancy.
Gearing stood at 42.6 per cent as at Mar 31, 2025, down from 41.9 per cent as at Dec 31, 2024. Weighted average lease expiry was 1.7 years by gross rental income and 2.4 years by net lettable area.
Outlook: recovery of business confidence will take time
Noting that Chinese regulators have announced fiscal and monetary stimuli to boost domestic consumption and growth to cushion tariff impacts, the manager said: “While these efforts are under way, the recovery of business confidence will take time, with a lag expected before the effects are fully felt.”
CLCT’s retail portfolio should have “enhanced resilience” given its asset enhancement initiatives completed in 2023, the manager said.
Market pressures are expected to lead to weakness in average rental prices and occupancies at CLCT business parks, it said.
The logistics parks sector remains highly exposed to trade-related risks although there are ongoing efforts to explore portfolio reconstitution opportunities.
Units of CLCT closed 3.8 per cent or S$0.025 higher at S$0.69 on Wednesday.