Property income from CapitaLand Retail China’s business rose 15 per cent year-on-year in the first quarter.
CapitaLand Retail China Trust Management (CRCTML), which manages CapitaLand Retail China Trust (CRCT), has reported a net property income of RMB194.9 million (US$28.3 million) for the quarter.
The Singapore-headquartered group attributes the increase mainly to the contribution from CapitaMall Xinnan, acquired at the end of September. This was partially offset by extra tax provision for Beijing malls because a change from cost to revenue basis effective from July.
With China’s economy expanding 6.9 per cent and retail sales growing 10 per cent, CRCT’s family-oriented shopping malls are well-positioned to benefit from the sustained increase in China’s domestic consumption, says CRCTML chairman Soh Kim Soon.
CEO Tan Tze Wooi says CapitaMall Xinnan notched up its committed occupancy to 99.6 per cent from 98.2 per cent at the end of December. “Proactive lease management to refresh its tenant mix is progressing ahead of schedule.”
He said new tenants, such as restaurants Dou Wa and Lei Men Ramen, will start contributing income from the second half of this year.
“Our performance was also boosted by CapitaMall Minzhongleyuan, which recorded year-on-year increases of more than 90 per cent and more than 60 per cent in shopper traffic and tenants’ sales respectively after the reopening of Zhongshan Avenue enhanced its accessibility.”
At March 31, CRCT’s portfolio occupancy was 96.2 per cent, up from the 95.9 per cent at the end of the previous quarter.
“We also undertook unit reconfiguration works in our malls to maximise their value,” says Tan Tze Wooi. “At CapitaMall Grand Canyon we added more than 600 square metres of retail space, mainly from converting underused common areas.”
Fashion, sporting goods and F&B brands occupying the new space increased rental income by about 24 per cent as well as helping diversify the mall’s offerings.
CRCT is the first China shopping mall real-estate investment trust (REIT) in Singapore, with a portfolio of 11 income-producing malls in China.
As at the end of last month, the total asset size of CRCT was about S$2.7 billion (US$1.9 billion).