PETALING JAYA: CapitaLand Malaysia REIT Management Sdn Bhd (CMRM), the manager of Capitaland Malaysia Trust (CLMT), remains focused on expanding its industrial and logistics portfolio as part of its long-term strategy.
CMRM chief executive officer Tan Choon Siang said the trust is targeting key regions, including the Klang Valley, Penang and Johor.
Specifically, he said, Johor offers significant potential due to increasing foreign direct investments.
“CapitaLand has a big portfolio in Singapore.
“We understand the market there.
“If there’s any movement of investments or relocation of industrial activity from Singapore to Johor, we have that visibility because we own the assets in Singapore.
“Capturing market share in Johor is part of our overall strategy,” he said during the group’s financial year 2024 (FY24) results briefing yesterday.
It is worth noting that CMRM is an indirect subsidiary of Singapore-listed CapitaLand Investment Ltd.
Tan added that CMRM is keen to deploy capital in the industrial and logistics sectors, with plans to close opportunities in 2025. “We are looking at some opportunities and hope to finalise them in 2025 without going into specifics,” he said.
However, Tan said the real estate investment trust (REIT) will avoid large-scale greenfield developments.
“Our strategy is not to develop completely greenfield projects, be it retail integrated or industrial.
“It won’t be beneficial to investors because the capital deployed would be stuck in the development stage for at least four or five years, yielding no returns to unit holders,” he said
For the final quarter of its financial year 2024 (4Q24), CLMT reported a revenue of RM119.98mil, a 10.6% increase from RM108.51mil in 4Q23.
This brought the full-year revenue for FY24 to RM454.76mil, 15% higher than the RM395.39mil recorded in FY23.
Net property income (NPI) for the quarter rose 15% to RM72.5mil from RM63.02mil in 4Q23.
For FY24, NPI increased by 21.4% to RM263.9mil from RM217.4 mil.
Tan noted that this marked a record NPI on a full-year basis since CLMT’s initial public offering in 2010.
Distribution per unit (DPU) for FY24 stood at 4.65 sen, an 11.5% increase from 4.17 sen in FY23, translating to a yield of 6.9%.
“This will put us ahead of most Malaysian REITs in terms of growth in DPU for the year,” Tan said.
The portfolio’s occupancy rate was stable at 92.8%, with retail rental reversions up 11.3% and shopper traffic increasing 4.7% year-on-year.
The portfolio’s valuation rose 2.4% to RM5.13bil, with notable gains from Queensbay Mall, up 6.9% to RM1.16bil and Glenmarie Distribution Centre, which increased 38.8% following refurbishment works.
“Our gearing improved to 41.3%, down from 42.1% last quarter, largely due to the increase in portfolio valuation,” Tan said, adding that 40% of CLMT’s RM2bil loan portfolio is now sustainability-linked.
Looking ahead, Tan said CLMT expects positive rental reversions in 2025, with 38% of leases up for renewal.
“This provides an opportunity to re-rate rents upwards, as many leases were locked in during or after Covid-19 when rents were softer.”
Tan will step down as CEO of CMRM and be succeeded by Yong Su-Lin on Feb 1.
Tan was chief financial officer of Ascendas Property Fund Trustees Pte Ltd from 2017 to 2021.
He was head of corporate finance and treasury of Ascendas-Singbridge Pte Ltd from 2016 to 2017.