CRCT’s malls yet to unleash ‘full potential’

SINGAPORE (July 28): DBS Group Research has downgraded CapitaLand Retail China Trust from “buy” to “hold”, with a lower target price of $1.60 from $1.69 previously.

In a note on Thursday, analysts Mervin Song and Derek Tan say CRCT’s retail malls have yet to perform to their full potential as they were either ramping up their business operations, or were caught in a transitional phase.

For instance, Grand Canyon was acquired in 2014 and is currently only generating an annual net property income yield of 5.4%, lower than the targeted range of 7% to 8%. Minzhongleyuan and Wuhu are also recording losses because of road closures and repositioning works respectively.

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