• Sat
  • Jul 12, 2014
  • Updated: 8:26am

CapitaMalls bullish on mainland

PUBLISHED : Tuesday, 10 July, 2012, 12:00am
UPDATED : Tuesday, 10 July, 2012, 12:00am

Singapore-listed shopping arcade developer CapitaMalls Asia remains optimistic about the outlook for the mainland's retail property market despite slowing economic growth.

It says it expects to double the value of its assets in China to US$20 billion in three to five years.

'One reason that the China market gives us confidence is tenant sales, which are improving year after year. This year, the mainland's retail sales are expected to increase by 16 to 17 per cent,' Simon Ho Chee-hwee, the company's deputy chief executive, said in an interview in Singapore. He said retail sales in Singapore and Malaysia grew by 5 per cent in the first half of this year.

The shopping-mall arm of CapitaLand, the largest property developer in Southeast Asia, has 98 malls in its portfolio, of which 26 are yet to open, in Singapore, Malaysia, China, Japan and India.

They have a combined gross floor area of 88.6 million square feet and include 42 operating malls on the mainland and 15 in the pipeline.

Ho said notwithstanding slowing economic growth, there would still be an uptrend for the retail property market and China would remain the group's major driver for growth.

'China is definitely one of our big markets and we are going to focus on it a lot,' he said. 'From now to December, we will open seven more malls in China, so that means we will open a new mall every three weeks.' Target markets for the group are key cities such as Shanghai, Beijing, Wuhan, Chongqing and Chengdu. It believes its portfolio of 19 malls in Singapore, which has a population of about five million, is sufficient, compared with Shanghai, where the population is 23 million and the firm has only five malls.

Last week, the company launched a new fund, named CapitaMalls China Development Fund III, with a size of US$1 billion and a fund life of eight years, to support its growth in the country. Ho said the fund would provide the 'fire power' for growth .

Separately, parent CapitaLand said it plans to acquire a serviced residence in Singapore for S$369 million (HK$2.25 billion) to boost profit, Bloomberg reported.

The company will purchase Somerset Grand Cairnhill Singapore from Ascott Residence Trust, whose primary properties include serviced apartments and rental properties. It will then sell part of the redeveloped Cairnhill property, which will comprise commercial and residential units, to Ascott's real estate investment trust, in which CapitaLand has a 49 per cent stake.

Share

For unlimited access to:

SCMP.com SCMP Tablet Edition SCMP Mobile Edition 10-year news archive
 
 

 

 
 
 
 
 

Login

SCMP.com Account

or