CapitaLand China Trust

CLCT said total assets were SGD 4.5 billion, with 8 retail malls, 5 business parks, and 4 logistics assets. For 1Q 2026, overall portfolio gross revenue dropped about 5% and NPI about 3% year on year, mainly due to the Yuhuating divestment; on a same-store basis, gross revenue was down 0.4% and NPI was up 1.3%. Retail headline revenue fell 7.2%, but excluding Yuhuating, the same-store decline narrowed to 0.5%; retail AEIs added about RMB 5 million per quarter. Retail traffic grew 3.3%, tenant sales grew 5.5%, and occupancy cost was 17%. Business park occupancy was 86% with reversion at minus 11%; logistics occupancy was about 99% overall and 96.2% in Chengdu. Average cost of debt declined to 3.1% from 3.3% at end-2025, generating about SGD 2.9 million of loan interest savings and an 18% year-on-year decline. Aggregate leverage was 41.4%, and the interest coverage ratio was said to be 2.9x under stress test conditions. Forwardly, management did not give formal earnings guidance, but said it expects to keep cost of debt around 3.1% if possible, refinance the RMB 600 million 3.8% FTZ bond due in Q4 2026, and continue seeking an asset acquisition before another securitization/divestment.

Gerry Chan framed 2026 as a continuation of CLCT’s 2025 strategy: focus on domestic consumption and innovation-led assets, keep recycling capital through the C-REIT platform, and use AEIs to lift income from existing properties. He said the near-term priority is to replace income lost from Yuhuating with a new acquisition before doing more securitization, and emphasized that the company has no rush given the buoyant C-REIT market. His tone was constructive but measured, repeatedly stressing portfolio stability, occupancy, and value creation rather than aggressive expansion.

Lintong Yan said capital management remains a core priority, highlighting aggregate leverage of 41.4%, average cost of debt of 3.1%, and a lower-interest-rate mix achieved by shifting funding from higher-cost SGD debt into RMB debt. He said RMB-denominated debt is about 60% of total borrowings, and about 78% including hedging instruments, with fixed and floating rate debt now around a 65% split. He also noted the interest coverage ratio improves to 2.9x under stress scenarios and that the 2026 refinancing focus is the RMB 600 million 3.8% FTZ bond due in Q4 2026.

Analysts focused on why Q1 improved quarter on quarter, and management pointed to the full-year benefit from AEIs, the drag from Yuhuating in prior periods, and better contribution from business parks and logistics. On retail reversion versus stronger sales, management said China’s deflationary backdrop is keeping rent growth subdued even as tenant sales improve, but they view sales trends as a leading indicator. Other questions covered the new C-REIT regime, acquisition pace versus divestments, leverage capacity, logistics rent stabilization, FX hedging, and costs; management said it is comfortable with the new C-REIT format, prefers to wait for income replacement before further divestments, hedges about 75% to 90% of RMB exposure 6 to 12 months ahead, and sees business park reversions staying in a similar range for the rest of the year.