Following Suntec REIT’s business update last Friday morning before market hours (you can read about it here in case you’ve missed it), CapitaLand Integrated Commercial Trust (SGX:C38U) is another REIT that I have in my long-term investment portfolio that have posted its third quarter business update (ended 30 September 2021) on the very same day, but after market hours.

As the blue-chip REIT have switched to reporting its full financial results on a half-yearly basis, for the quarter under review, it only provided some of the key profitability figures – which you will read about in my review about its business update today (where you’ll find its quarter-on-quarter, or q-o-q, as well as its year-on-year, or y-o-y, performances so far), together with its latest portfolio occupancy and debt profile (where I’ll be comparing the figures reported for the current quarter under review against that reported in the previous quarter.) On top of that, I’ve also included my personal opinion about its latest business update to share…

Financial Results (Q3 FY2020 vs. Q3 FY2021, and 9M FY2020 vs. 9M FY2021)

Q3 FY2020 vs. Q3 FY2021:

Q3 FY2020Q3 FY2021% Variation
Gross Revenue
$150.3m$329.0m> +100.0%
Property Operating
Expenses (S$’mil)
Net Property
Income (S$’mil)
$104.4m$242.6m> +100.0%

The most recent q-o-q improvements in its gross revenue, as well as in its net property income, are very much expected because of the contribution of revenue from the properties from CapitaLand Commercial Trust post-merger (with effect from 21 October 2020.)

Along with the inclusion of properties from CapitaLand Commercial Trust, its property operating expenses also saw a 88.5% q-o-q jump (due to the expenses incurred by the properties added to the REIT’s portfolio.)

9M FY2020 vs. 9M FY2021:

9M FY20209M FY2021% Variation
Gross Revenue
$468.7m$974.7m> +100.0%
Property Operating
Expenses (S$’mil)
Net Property
Income (S$’mil)
$320.8m$714.8m> +100.0%

Due to the inclusion of properties from CapitaLand Commercial Trust as a result of the merger, on a y-o-y basis, its top- and bottom-line saw a significant improvement compared to the same time period last year (which was before the merger.)

Portfolio Occupancy Profile (Q2 FY2021 vs. Q3 FY2021)

In this section about the REIT’s portfolio occupancy, I’ll be comparing its statistics recorded for the current quarter under review (i.e. Q3 FY2021 ended 30 September 2021) against that recorded in the previous quarter (i.e. Q2 FY2021 ended 30 June 2021) to find out whether or not it has improved, or declined:

Q2 FY2021Q3 FY2021
Portfolio Occupancy
WALE (by Gross Rental
Income – Retail)
1.9 years1.9 years
Portfolio Occupancy
WALE (by Gross Rental
Income – Office)
2.7 years2.6 years
Portfolio Occupancy
(Integrated Development)
WALE (by Gross Rental
Income – Integrated

5.0 years5.0 years

My Observations: The occupancy levels of all the property types (retail, office, and integrated development) dipped slightly compared to the previous quarter, while the WALE (Weighted Average Lease Expiry) has remained consistent. This was pretty much within my expectation (particularly for the retail sector) due to the headwinds that the industry is currently facing as a result of yet another wave of Covid-19 outbreak, and subsequently some re-tightening measures imposed by the Singapore government in an attempt to reduce the load on Singapore’s hospitals (where the capacity and medical staff have been overwhelmed by the surge in the number of patients, particularly those needing oxygen as well as in the ICU.)

For the REIT’s retail properties, most of its malls saw some dip in terms of their occupancy rates:

  • Funan – Retail (from 97.3% in Q2 FY2021 to 96.8% in Q3 FY2021)
  • IMM Building (from 99.9% in Q2 FY2021 to 99.8% in Q3 FY2021)
  • Bugis Junction (from 99.1% in Q2 FY2021 to 98.7% in Q3 FY2021)
  • Raffles City Singapore – Retail (from 92.3% in Q2 FY2021 to 91.5% in Q3 FY2021)
  • The Atrium@Orchard (from 94.2% in Q2 FY2021 to 92.1% in Q3 FY2021)
  • Clarke Quay (from 82.9% in Q2 FY2021 to 79.4% in Q3 FY2021 – as its leases were affected by the Government-stipulated restrictions on trading hours and sales of alcohol at nightlife venues like clubs, karaoke joints, and bars without food licenses)
  • Bugis+ (from 96.9% in Q2 FY2021 to 94.1% in Q3 FY2021)
  • Westgate (from 98.0% in Q2 FY2021 in Q2 FY2021 to 97.3% in Q3 FY2021)

The only retail malls under the REIT’s portfolio that have seen its occupancy rate improve or unchanged is Tampines Mall (from 99.9% in Q2 FY2021 to Q3 FY2021), Bedok Mall (from 98.0% in Q2 FY2021 to 98.9% in Q3 FY2021), Junction 8 (full occupancy in the previous and in the current quarter under review), as well as Lot One Shoppers’ Mall (with an occupancy rate of 99.7% in the previous and in the current quarter under review) – if you notice, all of these malls are located in the suburban areas, which have benefited as working from home is once again the default, along with people’s preference to visit retail malls near their homes for necessities as it’s more convenient to do so.

For the REIT’s office properties, occupancy rates in the various properties it owns remain largely stable, except for slight declines in 2 of them:

  • Asia Square Tower 2 (from 84.7% in Q2 FY2021 to 82.8% in Q3 FY2021; However, backfilling is currently in progress, and about 14.0% of the building’s net lettable area is under advanced negotiation)
  • CapitaGreen (from 96.0% in Q2 FY2021 to 92.4% in Q2 FY2021, with about 2.0% of the property’s net lettable area currently under advanced negotiation)

Finally, for the 3 integrated developments in the REIT’s portfolio, all of them saw slight declines in their occupancy rates, as follows:

  • Raffles City Singapore (from 93.6% in Q2 FY2021 to 93.4% in Q3 FY2021)
  • Funan (from 98.4% in Q2 FY2021 to 98.1% in Q3 FY2021)
  • Plaza Singapura & The Atrium@Orchard (from 97.9% in Q2 FY2021 to 97.7% in Q3 FY2021)

Debt Profile (Q2 FY2021 vs. Q3 FY2021)

Just like how I have studied the blue-chip REIT’s portfolio occupancy profile in the previous section, I will also be comparing its debt profile recorded for the current quarter under review against that recorded in the previous quarter, as follows:

Q2 FY2021Q3 FY2021
Aggregate Leverage
Interest Coverage Ratio
Average Term to Debt
Maturity (years)
4.3 years4.1 years
Average Cost of
Debt (%)

My Observations: Personally, I felt that the REIT’s debt profile have continued to remain stable when compared against the figures recorded in the previous quarter. For the remaining quarter of the current financial year, only $75m (or 1%) of its borrowings will be due, with another $1,111m (or 12%) due next in the financial year 2022.

Closing Thoughts

On the whole, the blue-chip REIT’s latest set of results (as far as its financial performance, portfolio occupancy and debt profile were concerned) were all within my expectations.

Some of you may have some concerns about the dip in occupancy rate in many of the REIT’s retail malls – personally, I am of the opinion that the recent resurgence of the community case numbers in Singapore, along with the current “stabilisation” measures imposed by the Singapore government (which will last till 21 November) may impact the retail malls (especially those in the CBD) to a certain extent – first, it will be due to people working from home currently, and second it will be because of people responding to the Singapore government’s calls to reduce unnecessary social gatherings. That said, however, despite of the headwinds, its good to note that most of the REIT’s retail malls have occupancy rates of at least 90.0%.

Finally, in case you’re wondering why there were no mention about distribution payouts, as the REIT switched to reporting its full financial statements on a half-yearly basis, it has also switched to paying a distribution to its unitholders in the same time frequency. As such, there’s no distribution payout declared for the current quarter under review.

With that, I have come to the end of my review of CapitaLand Integrated Commercial Trust’s third quarter business update ended 30 September 2021. Please note that all the opinions you have read about in this post are purely mine which I’m sharing for educational purposes only. This post is by no means any recommendation to buy or sell any units of the blue-chip REIT. You’re strongly encouraged to do your own due diligence before you make any investment decisions.

Related Documents

Disclaimer: At the time of writing, I am a unitholder of CapitaLand Integrated Commercial Trust.

Launch Event for My First Book: building your REIT-irement portfolio

building your REIT-irement portfolio by Lim Jun Yuan - Official Book Launch on 26 September 2023

After months of hard work, my first book, 'Building Your REIT-irement portfolio' is finally ready! In this easy-to-follow 178-page guide, you'll learn everything you need to know about building a REIT portfolio that can provide for you in your retirement years. You can check out a preview of the book here.

I'm extremely thankful to the team at InvestingNote and ShareInvestor for their help to organise a book launch event for me on Tuesday, 26th September 2023, from 6:00pm to 8:00pm at their office in New Tech Park.

For more details and to RSVP (seats are extremely limited), click on the link below:

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