CapitaLand Retail China Trust's Rock Square. (Photo: CapitaLand Retail China Trust)

Singapore-listed retail REIT, CapitaLand Retail China Trust, announced on 28 November that it has formed a joint venture company with its sponsor to acquire all the shares in a company that owns Rock Square, a mall located in the Haizhu District of Guangzhou.

The property has been described as one of the largest malls in Haizhu, features a gross floor area (GFA) excluding car park of about 83,591 square metres, and serves about 800,000 residents from middle- and high-income households within a three-kilometre radius.

CapitaLand Retail China Trust is the majority shareholder in the joint venture with a 51% stake, while CapitaLand owns the remaining 49%.

What are some factors that investors need to know about this acquisition, and what is a concern that stands out? We discuss these in the following analysis.

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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.