Singapore's NTUC trims size of shopping mall portfolio sale -sources

CapitaLand Integrated Commercial Trust

10/10/2022 08:47

By Anshuman Daga and Yantoultra Ngui
       SINGAPORE, Oct 10 (Reuters) - Singapore shopping mall
owner NTUC Enterprise Co-operative Ltd has scaled down the size
of a planned asset sale to about S$3 billion ($2.1 billion), or
three-fourths of the original proposal, while short-listing
three potential buyers, sources familiar with the matter said.
    Singapore's rising interest rates and a tepid growth outlook
have prompted Mercatus Co-operative Ltd, a unit of NTUC that
manages the assets and was exploring the sale, to remove at
least one project from the prospective deal, the sources added.
    The sources declined to be identified as they were not
authorised to speak to the media.
    Mercatus declined to comment while NTUC referred inquiries
to Mercatus.
    Despite the trimmed size, the sale would mark the biggest
real estate deal so far this year in the city-state, Refinitiv
data shows.
    "The portfolio that was being offered has been reduced. It's
a difficult market situation," said one source with knowledge of
the sale process.
    The sources said the remaining assets include retail malls
Jurong Point, NEX, and Swing By @ Thomson Plaza. AMK Hub, a
retail mall in the Ang Mo Kio residential area, is no longer
part of the sale, the sources added.
    Mercatus co-owns NEX, its website shows.
    The sources said the three short-listed parties are Frasers
Property  FRPL.SI , part of Thai billionaire Charoen
Sirivadhanabhakdi's group, Hong Kong-based Link Real Estate
Investment Trust  0823.HK , and CapitaLand Integrated Commercial
Trust  CMLT.SI  (CICT), part of Singapore-based CapitaLand
Investment Ltd.
    A CICT spokesperson said in an emailed response that it
regularly holds discussions with other parties and evaluates
possible opportunities, but did not comment directly on the NTUC
sale.
    Frasers Property and Link REIT declined to comment.
    Singapore's growth prospects have dimmed along with the
global economic outlook. The government in August lowered its
full-year growth projection to a 3% to 4% range, from its prior
3% to 5% outlook, while second-quarter GDP growth was revised
down to an annual 4.4% from 4.8%. urn:newsml:reuters.com:*:nL1N2ZN01G
    Local interest rates are also rising sharply, in line with
global trends, with the Singapore interbank offered rate
 SORA=MAST  hovering at 3.38% compared with 1.2% at mid-June,
when Mercatus announced the review of some of its real estate
assets and holdings.
    With more than S$10 billion of assets under management,
Mercatus is one of the largest owners of retail mall space in
Singapore, its website shows.
    The group's portfolio includes commercial assets in
Singapore and Sydney. It also owns properties within retail
malls in Singapore and an office skyscraper, One Marina
Boulevard, in the city-state's central business district.
    NTUC Enterprise is part of Singapore's biggest trade union,
the National Trades Union Congress.
 ($1 = 1.4332 Singapore dollars)
 (Reporting by Anshuman Daga and Yantoultra Ngui; Editing by
Edmund Klamann)
 ((anshuman.daga@tr.com;))