KUALA LUMPUR: The manager of CapitaLand Malaysia Trust (CLMT), CapitaLand Malaysia REIT Management Sdn Bhd (CMRM), intends to add more assets to its portfolio.
The chief executive officer of CMRM, Tan Choon Siang, revealed that the company would prioritise purchasing industrial and logistical assets in the future.
"We have done two acquisitions, and we have announced the third one. We also want to make sure that we absorb the acquisitions well and achieve the intended results before we embark on further significant transactions," he said.
In its business overview presentation in April, CMMT indicated that it intended to increase portfolio occupancy through proactive asset management and to develop new retail solutions by utilising the sponsor's broad network of strategic partners.
In addition, it will look into opportunities from third-party vendors, yield-accretive investment opportunities in new asset classes to pursue inorganic growth, and proactive debt management to lower gearing.
CLMT recently purchased the Hicom-Glenmarie Industrial Park, a freehold logistics warehouse in Shah Alam during the quarter.
"The acquisition is expected to be completed in the second half of 2023," Tan said.
CLMT will be transforming the warehouse into a temperature-controlled distribution centre through a convert-to-suit exercise, and subsequently it will be leased to a fashion retailer for 10 years.
Future contributions from this warehouse are expected to contribute to CLMT's steady financial performance, he said.
CMRM has RM4.9 billion worth of assets under management. The seven assets under its portfolio are Gurney Plaza, East Coast Mall, Sungei Wang Plaza, 3 Damansara Property, The Mines, Valdor Logistics Hub and Queensbay Mall with a total net lettable area of 4.3 million square feet.
As of March 31, 2023, the top three categories that made up 63.4 per cent of gross rental income were clothing and accessories (28.8 per cent), food and drink (21 per cent) and beauty/health (13.6 per cent).
CLMT intends to revamp the tenant mix and improve the overall retail experience at several of its properties by introducing new food and beverage concepts.
It is also planning asset enhancement at 3 Damansara in Petaling Jaya in an effort to maximise the approximately 14,000 square feet of space on the lower ground floor by the end of 2023 and add more high-quality F&B options.
Tan said that the majority of the shopping centres in its portfolio recorded an increase in gross income as a result of better occupancy when compared to a year prior.
The portfolio continued to show resilience, with a solid occupancy of 88 per cent and a favourable rental reversion of 4.7 per cent, he said at a virtual media conference on CLMT's second quarter financial results for the fiscal year ending December 31, 2023, yesterday.
In the second quarter of 2023, tenant sales per square foot increased by 4.8 per cent year over year, while same-store shopper visitation increased by 25.8 per cent.
Tan is certain that this year's consumer spending growth will continue.
In comparison to the first half of last year, he said that consumer spending has continued to rise.
"Without any reasons to suggest otherwise, we do think that consumer spending will maintain momentum because, if you look at increases in spending such as food and beverage as well as entertainment, a lot of these are making a strong comeback," he said.
Tan added that there was no impact of the weakening ringgit on consumer spending.