Fashion
CEO of CapitaRetail China Trust Management Limited (CRCT), Tony Tan said the growth was underpinned by the new contribution from CapitaMall Grand Canyon and rental growth from the other multi-tenanted malls.
“Rental reversion was a robust 20.6 per cent, and portfolio occupancy as at December 31 was a healthy 95.9 per cent. Tenants’ sales and shopper traffic for 2014 increased year-on year by 16.2 per cent and 3.9 per cent respectively.”
Singapore-based CRCT has 10 income-producing CapitaMall-branded shopping malls in greater China: Xizhimen, Wangjing, Grand Canyon, Shuangjing and Anzhen in Beijing; Qibao in Shanghai; Erqi in Zhengzhou, Henan Province; Saihan in Huhhot, Inner Mongolia; Wuhu in Wuhu, Anhui Province; and Minzhongleyuan in Wuhan, Hubei Province. Total assets are valued at about S$2.4 billion.
All the malls are positioned as one-stop family-oriented shopping, dining and entertainment destinations for the sizeable population catchment areas in which they are located, and are accessible via major transportation routes or access points. A significant portion of the properties’ tenancies consists of major international and domestic retailers such as Beijing Hualian Group and Carrefour under master leases or long-term leases, which provide unitholders with stable and sustainable returns. Other tenants include KFC, Paris Baguette, Pizza Hut, Sephora, Uniqlo, Vero Moda, Watsons and Zara.
“For 2014, CapitaMall Xizhimen and CapitaMall Wangjing – our largest revenue contributors – recorded growth of 16.4 per cent and 13.7 per cent in their net property income (NPI) respectively, after a series of tenant mix adjustments,” said Tan.
“Over at CapitaMall Grand Canyon, new tenants such as Nanjing Impressions opened to strong sales, and plans for further reconfiguration of the mall’s layout to add more retail units are progressing well. CapitaMall Qibao, which achieved 17.5 per cent growth in NPI, strengthened its education and children-related trade offerings on its Level 4 with the introduction of C&S – an enrichment centre which offers baking classes to both adults and children and held well-received thematic marketing activities such as the Shanghai Animation Film Studio Exhibition.
“The upgrading of the tenant mix at CapitaMall Saihan also showed positive results, with its NPI increasing by 19 per cent in 2014.”
Tan said CapitaMall Wuhu is also currently undergoing tenant mix adjustments to achieve a stronger positioning and better trade mix.
“In the short term, CapitaMall Minzhongleyuan’s NPI has been impacted by the road closure for subway construction works, but the mall will stand to benefit from increased shopper traffic when subway Line 6 linking Hankou and Hanyang becomes operational by end-2016. With the financial flexibility provided by our robust balance sheet, we continue to be on the lookout for acquisition opportunities to grow our portfolio further.”
The trust achieved distributable income of S$20.5 million for the quarter, an increase of 15.6 per cent over the S$17.7 million for the fourth quarter of 2013.
Chairman Victor Liew said China’s economy expanded by 7.4 per cent in 2014 and retail sales grew 12 per cent to RMB26.2 trillion.
“The Chinese government has continued to place a strong emphasis on quality and sustainable growth, and we have seen an overall stability in the economy and the labour market in the past year. The country’s efforts at economic restructuring are seeing progress, and the services sector has developed into the largest pillar of China’s economy.
“Moving forward, with the government’s focus on driving domestic consumption and maintaining long term stability, CRCT remains upbeat about China’s retail growth prospects,” said Liew.
