CapitaLand Investment Eyes Up to $7B in Potential Asset Sales as H1 Profit Rises 14%

Singapore's CapitaLand Investment has outlined plans to sell up to $7 billion in non-core and legacy assets as part of a strategy to concentrate capital and resources on its core growth platforms. The SGX-listed real asset manager reported a 14 percent rise in first-half attributable profit to S$327 million, driven by a 13 percent increase in operating profit to S$293 million and a 26 percent rise in portfolio gains to S$34 million. CapitaLand Investment has announced plans to organise its holdings into separate core and non-core businesses, with the latter comprising legacy funds, balance sheet assets, and non-strategic stakes in managed REITs and private funds. The company's CEO, Lee Chee Koon, stated that the strategy aims to enhance capital efficiency, strengthen the balance sheet, and support sustainable shareholder returns. Proceeds from the sale of non-core assets will be channelled into the company's core fund management platforms and balance sheet strength, with excess capital to be returned to shareholders. The firm has already announced roughly S$5 billion in gross divestments this year, including the $321 million sale of a Chennai business park to India's Mindspace REIT. Fee-related revenue jumped 20 percent to S$687 million, with combined revenue from listed and private funds surging 48 percent to S$316 million. The fee business contributed S$201 million in attributable operating profit, up 24 percent from a year earlier. Listed-fund fee revenue rose 45 percent to S$224 million on higher recurring and event-driven fees, while private fund revenue climbed 59 percent to S$92 million. Fundraising grew 42 percent to S$3.7 billion, comprising S$2.3 billion raised by listed funds and S$1.4 billion by private vehicles, as funds under management increased 2 percent from year-end to S$128 billion. The company's listed vehicles announced S$7.1 billion in acquisitions and S$3.5 billion in divestments through 12 August, lifting transaction volume to S$10.6 billion. Equity raised by the listed platform reached S$2.3 billion, roughly four times the year-earlier level. CapitaLand Investment's private funds business will focus on commercial, living, self-storage, and credit strategies, while rationalising sub-scale vehicles. The firm has listed a RMB 3.15 billion ($467 million) commercial private REIT seeded with Shanghai's CapitaMall LuOne, with plans to float another China REIT in the second half. In related news, CapitaLand Integrated Commercial Trust (CICT), Asia's biggest listed REIT by market cap and a proxy for Singapore's commercial property market, recorded a 7.1 percent rise in first-half distribution per unit to S$0.0602 despite an enlarged unit base after an April private placement. CICT's gross revenue grew 7.5 percent to S$846.8 million, net property income increased 8.7 percent to S$630.5 million, and distributable income advanced 13.3 percent to S$466.7 million. The trust's manager, which is owned by CapitaLand Investment, attributed the positive performance to healthy leasing demand across its retail and office portfolios, which translated into positive rental reversions and high portfolio occupancy. Portfolio occupancy stood at 95.6 percent after the trust renewed or secured more than 1 million square feet (92,903 square meters) of leases, achieving rental reversions of 4 percent for retail and 6.5 percent for offices. The trust completed its S$3.9 billion purchase of Paragon on 1 July, with the Orchard Road complex expected to begin contributing income in the second half. The trust is studying a selective reconfiguration of the mall, including space occupied by department store operator Metro, as it seeks to introduce new retail concepts and improve sheltered links to surrounding properties.