On September 3, CapitaLand Integrated Commercial Trust (CICT), Singapore’s largest diversified real estate investment trust, announced that it had reached an agreement with its sponsor, CapitaLand Investment Limited (CLI), to acquire a 50% stake in Singapore’s iconic high-end shopping mall, ION Orchard, for a property value of SGD 1.8485 billion (approximately USD 1.412 billion).
The proposed acquisition of ION Orchard is expected to strengthen CICT’s “resilience in its portfolio of high-quality, diversified retail, office, and integrated developments” and further solidify its leading position as the largest private retail asset owner in Singapore.
ION Orchard
ION Orchard is located at the gateway of Singapore’s renowned Orchard Road district, with a net leasable area of approximately 623,600 square feet (about 57,934 square meters). Besides featuring luxury retail and curated dining establishments, ION Orchard also offers a food hall with a variety of local and international cuisine, the ION Art Gallery, and the ION Sky observation deck for a multi-sensory experience.
Additionally, ION Orchard is connected to the 56-story luxury residential tower The Orchard Residences, with direct sheltered access to the Orchard MRT station. ION Orchard also features the ION Orchard Link, an underground walkway with retail offerings, serving as a key connector to other parts of Orchard Road.
CICTML Chairperson Teo Swee Lian commented, “The acquisition of the highly sought-after destination shopping mall ION Orchard will further strengthen our presence in Singapore. Located in a prime location with excellent transport links, ION Orchard is renowned for its iconic architecture and wide appeal, attracting millions of locals and tourists annually. With rising tourist numbers and increasing retail rents along Orchard Road, we are well-positioned to capitalize on favorable supply-demand dynamics and seize opportunities from the ongoing revitalization of Orchard Road. This proposed acquisition will significantly drive CICT’s growth strategy and further cement our downtown positioning in major retail hubs, including Orchard Road, Dhoby Ghaut, and City Hall, where retail property supply is limited.”
CICTML CEO Tony Tan added, “The acquisition of ION Orchard is a transformative move in our strategy to build a resilient, high-quality, Singapore-focused diversified portfolio that delivers sustainable returns to our unitholders across market cycles. With nearly 300 international and local brands spanning eight floors of retail space, ION Orchard’s diverse tenant mix will enable CICT to capture Singapore’s luxury retail market and benefit from domestic and international consumer spending, while ensuring steady demand for essential goods and services during economic cycles.”
Tan further noted that the acquisition, expected to be distribution-per-unit accretive, would enhance CICT’s market position as a leading agent of prime commercial real estate in Singapore, “creating greater value for our unitholders.” Subject to unitholder approval, the acquisition is expected to be completed in the fourth quarter of 2024.
“We are also delighted to continue our close partnership with Sun Hung Kai Properties and look forward to further elevating the shopping experience at ION Orchard, driving operational excellence and unlocking additional growth potential,” Tan concluded.
| Sources: CapitaLand Group website, Reuters
| Image Credit: CapitaLand Group website
| Editor: Liu Jun
