What Investors Should Know About CapitaLand Investment (SGX: 9CI) Shares
Sudhan P●
CapitaLand Investment (SGX: 9CI) is one of Asia’s leading listed real estate investment managers (REIM) and one of the largest REIM in the world.
The company was listed by way of introduction today on the Singapore Exchange after CapitaLand Limited restructured its business to form two distinct entities — CapitaLand Investment (CLI) and CapitaLand Development (CLD), the privatised property development arm.
CLI debuted at a share price of S$2.95 this morning.
As an introduction to the company (no pun intended), here are three quick things you should know about CLI.
#1: What’s CapitaLand Investment’s Business About?
CLI has two main business segments, and they are:
- Fee income-related business
- Real estate investments
Under the fee income-related business, CLI is involved in the investment and asset management of listed and unlisted funds.
Furthermore, CLI provides lodging management (for both owned and third-party owners of lodging assets) and property management.
Under the real estate investment business, CLI owns stakes in listed and unlisted funds and property investments.
The fee-income related business provides CLI with a recurring fee-based revenue stream.
Meanwhile, the real estate investment platform gives a stable flow of rental income from its global portfolio of commercial and lodging assets.
CLI also offers a pipeline of assets for its listed REITs to acquire.
#2: What Are the Listed REITs Under CapitaLand Investment?
In Singapore and Malaysia, CLI has stakes in six listed real estate investment trusts (REITs):
| REIT | CLI's Effective Stake (as of 30 June 2021) |
|---|---|
| CapitaLand Integrated Commercial Trust (SGX: C38U) | 22.9% |
| Ascendas Real Estate Investment Trust (SGX: A17U) | 18.0% |
| Ascott Residence Trust (SGX: HMN) | 40.7% |
| CapitaLand China Trust (SGX: AU8U) | 24.6% |
| Ascendas India Trust (SGX: CY6U) | 21.6% |
| CapitaLand Malaysia Mall Trust (KLSE: 5180) | 38.1% |
CLI’s interest in the six listed funds was valued at S$7.7 billion as of 7 July 2021.
The company’s stakes in the REITs ensure that its interests are aligned with that of the REIT’s unitholders.
#3: CapitaLand Investment’s Growth Opportunities
Looking ahead, CLI highlighted three main ways that it’s looking to grow.
Besides growing its listed REITs by constantly supporting them as their sponsor, CLI intends to scale up its unlisted funds by expanding into new strategies, products and geographies.
For instance, CLI recently entered into agreements to acquire a hyper-scale data centre campus in China.
Under its lodging business, CLI is expanding into adjacent sectors such as purpose-built student accommodation (PBSA) and multifamily asset classes.
The company considers lodging as “a high earning-accretive business model as we scale up management fees contribution and work towards better flow through over time as more properties become operational”.
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Disclaimer: The information provided by Seedly serves as an educational piece and is not intended to be personalised investment advice. Readers should always do their own due diligence and consider their financial goals before investing in any stock. The writer doesn’t own shares in any companies mentioned.
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