CapitaLand Integrated Commercial Trust CICT Q3 2023: Stable Performance

CICT Q3 2023

CapitaLand Integrated Commercial Trust (CICT) recently provided its business updates, and here we will summarize its results. CICT is the first and largest REIT listed on the Singapore Exchange (SGX). Its portfolio primarily comprises retail and office buildings across Singapore, Australia, and Germany, with Singapore being its most important geographical exposure. Let’s look at CICT Q3 2023 results.


Stable Financial Performance

We compare CICT Q3 2023 performance with the same quarter last year:

Q3 2023 Q3 2022 Change (%)
Gross Revenue 391.3m 374.1m +4.6%
Operating Expenses 116.3m 100.8m +15.4%
Net Property Income 275.0m 273.3m +0.6%

Gross revenue increased steadily by 4.6% to $391.3m, primarily due to higher actual occupancy and shopper traffic. Unfortunately, operating expenses increased significantly by 15.4% to $116.3m. As a result, net property income increased only by 0.6% to $275m. Overall, we saw a stable financial performance for CICT this last quarter, with income still climbing despite the higher expenses.


Slightly Weakening Debt Profile

Now, let’s look at CICT’s debt profile to see if the REIT is in a solid financial condition to weather any prolonged higher interest rate environment. Here is the summary:

Q3 2023 Q2 2023 Change
Aggregate Leverage 40.8% 40.4% +0.4%
% of Borrowings on Fixed Interest Rate 78% 78% 0%
Interest Coverage 3.1x 3.3x -0.2x
Average Cost of Debt 3.3% 3.2% +0.1%

CICT Q3 2023 debt profile weakened slightly, with the aggregate leverage ratio increasing by 0.4% to 40.8%. The interest coverage ratio (ICR) also declined to 3.1x this quarter. The average cost of debt increased slightly to 3.3% from 3.2% last quarter.

Despite the weakening, CICT’s debt profile is still considered healthy. The aggregate leverage is still far from the regulatory limit of 50%. CICT’s percentage of debt hedged to a fixed rate is also relatively healthy at 78%. The ICR is something to monitor going forward, as it has dropped from >4x earlier this year to just 3.1x this quarter.


Well-Staggered Debt Maturity Distribution

Source: CICT Analysis Page

The good news is that only 1% of the debt is due this year, 15% is due in 2024, and 13% is due in 2025. We pay more attention to the next two years as the market has been expecting interest rates to stay elevated throughout 2024 and 2025. CICT debt maturity distribution is well spread out and, therefore, more well-equipped to face any pro-longed high-interest rate environment.


Strong Portfolio Occupancy

We summarize CICT’s portfolio occupancy as of Q3 2023:

Q3 2023 Q2 2023
Portfolio Occupancy 97.3% 96.7%
WALE 3.5% 3.6%

Overall, the portfolio occupancy is relatively stable and healthy, climbing to 97.3% this quarter. Portfolio WALE dipped slightly to 3.5%. We also see a healthy positive rental reversion for its retail portfolio of +7.8% and its office portfolio of +8.8%.

Regarding lease expiry, we can see it is well staggered across all portfolio types. Only a small portion is up for renewal this year, with only around 14-15% of its retail portfolio and 6-8% of its office portfolio due for renewal between 2024 and 2026.

WeWork Bankruptcy?

We recently learned that WeWork is considering filing for bankruptcy. WeWork is one of the largest tenants of CICT, contributing 2.4% of total gross rent. The impact of WeWork’s bankruptcy on its Singapore office is still unknown. A spokesperson for CICT’s manager said that WeWork remains a tenant and pays its rent on schedule.

Should the bankruptcy proceed, we may see downward pressure on CICT’s income in the short term due to losing one of its major tenants. However, the impact should be limited as WeWork only contributes 2.4% of the total gross rent. We are confident that CICT’s portfolio will remain in high demand in the long run.



CICT’s financial performance is stable, with the net property income climbing by +0.6%. This is despite the jump in operating expenses of +15.4%. CICT’s debt profile has weakened slightly this quarter, with the aggregate leverage climbing to 40.8% and the ICR dropping to 3.1x. Despite the weakening, overall, CICT’s debt profile is relatively stable and very healthy. Debt maturity distribution is well distributed over the next several years, ensuring the REIT is prepared to face any prolonged higher-rate environment.

We also see its portfolio occupancy rate climbing to 97.3%, indicating strong demand for its portfolio. The lease expiry distribution is also well-staggered over the next several years.

CapitaLand Integrated Commercial Trust has a price-to-book ratio of 0.87 and a dividend yield of 5.79%. What do you think? For more information about CICT, please visit our CICT analysis page and our CICT dividend page.

For analysis of other REITs, you may check out our Singapore REITs’ data page.

Related page: Q3 2023 Presentation Slide

Stay up-to-date by following us:

Disclaimer: The information provided here is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice or recommendation of any sort.

Share this post:
David Ang

About David Ang

A long-term investor with a portfolio across the United States and Asian equities, REITs, commodities, and fixed incomes. After over a decade of hands-on investing (and making countless mistakes), I'm excited to use this platform to share what I've learned over the years. And let's continue to learn together. Writing about macro economy, equities, personal finance, web3. Follow me on Twitter: @danggaku