Analysis: CapitaLand Retail China Trust strengthens position with Rock Square acquisition

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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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About Author

Ridzwan Rahmat has been analysing Singapore-listed REITs and business trusts, since 2008. For disclosure purposes, Ridzwan is currently vested in Mapletree Greater China Commercial Trust, Mapletree Industrial REIT and Mapletree Logistics Trust.

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