Committed Occupancy Of CICT’s Office Portfolio Hits 94.1%

SINGAPORE – The committed occupancy of CapitaLand Integrated Commercial Trust’s (CICT) office portfolio increased from 91.9 percent as of 30 June to 94.1 percent at the end of Q3 2022, according to filings with the local bourse on Friday (21 October, SGT).

The occupancy rate only pertains to the real estate investment trust’s (REIT) office-only properties and the office component of its integrated projects.

At the same time, the weighted average lease expiry of CICT’s office properties stood at 4 years as of 30 September. While this is higher than its retail WALE of 2.2 years, it’s lower than the 5.4 years for the REIT’s WALE for integrated developments.

More importantly, CapitaLand Integrated Commercial Trust’s gross revenue rose 13.7 percent year-on-year to S$374.1 million in Q3 2022, while its net property income (NPI) climbed 12.7 percent to S$273.3 million.

The REIT’s manager said both growth in its gross revenue and NPI was propelled by the stronger performance of its office properties.

In fact, the gross revenue of CICT’s office assets rose from S$97.3 million in Q3 2021 to S$126.1 million during the period under review, while the NPI climbed from S$74.7 million to S$95.4 million.

Additionally, average rents of the REIT’s Singapore office properties S$10.52 psf, while the rent reversion of such assets increased by 7.9 percent from the start of this year to the 3rd quarter. Notably, rent reversion is based on average incoming committed office rents versus average outgoing office rents.

CICT’s manager also said there was robust positive office net absorption of 0.56 million sq ft in Q3 2022, exceeding last year’s overall take up of 0.32 million sq ft. The primary demand drivers were expansions by tech companies, coworking space operators and non-banking financial firms.

It expects Singapore office rental growth to remain positive next year thanks to limited new supply beyond that year, barring a sustained recession.