CapitaMall Anzhen (Photo: CapitaLand)

OCBC Investment Research has maintained a ‘Hold’ rating, and revised its fair value estimate on units of Singapore-listed CapitaLand Retail China Trust after the REIT announced the completion of a mall divestment.

The China-focused retail REIT announced on 15 September that it has completed the disposal process of CapitaMall Anzhen, which is currently master-leased to BHG (Beijing) Department Ltd.

“CapitaMall Anzhen is master leased till 2025 with limited upside and increasing capital expenditure commitments”, said the REIT in a statement on 27 July 2017 to justify the divestment.

“By unlocking the value of CapitaMall Anzhen at this stage, it will realise optimal value for our unitholders. The sale proceeds will also increase our financial flexibility to seize new growth opportunities”, the REIT added.

The property was sold to Beijing Hualian Anzhen Business Development Company Ltd, via the transfer of interests in a special purpose vehicle, for RMB1,129.5 million (SGD230.0 million) - approximately 13% above an independent valuation.

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By Ridzwan Rahmat

Ridzwan has been analysing REITs and business trusts since 2008, and personally manages a portfolio comprising mainly of SGX-listed REITs. He founded REITsWeek in 2013.