For one, CICT plans to add 15,000 sq ft of lettable area at Lot One Shoppers Mall through the conversion of carpark spaces over 4QFY2025 to 1QFY2027. Fairprice is also taking up additional space at basement two of the property.
The upgrading works at Tampines Mall are ongoing as well and CICT has secured new tenant commitments for part of the space to be vacated by Isetan in Nov 2025. CICT’s management is guiding for both AEIs to yield ROIs of above 7% each, says Lock, who has kept her “add” call and $2.71 target price.
Similarly, UOB KayHian’s Jonathan Koh has maintained his “buy” call along with a target price of $2.79. He points out that CICT’s office occupancy improved 1.6 percentage points q-o-q to 96.2% in 3QFY2025, driven by new tenants at 100 Arthur Street in North Sydney and MAC in Frankfurt.
The REIT is also set to benefit this year from the full year’s contribution of its 50% stake in ION Orchard, while CapitaSpring, which was fully acquired by CICT on August 26, will also contribute based on 100% interest henceforth.
See also: UOB Kay Hian's Loh initiates coverage on Centurion Accommodation REIT with target price of $1.23
With the recent issuance of $200 million seven-year fixed-rate notes due Sep 2032 at a low coupon rate of 2.25%, this brings about competitive advantage for CICT in terms of lower cost of debt.
Average cost of debt improved 0.1 percentage points q-o-q to 3.3% in 3QFY2025 due to the steep drop in SORA. CICT’s management guided the cost of debt to be at 3.1% - 3.2% for 2026.
On the other hand, Morningstar’s equity analyst Xavier Lee retained his fair value estimates of CICT at $2.32. In his Oct 28 note, Lee observes that CICT’s rental reversion figure saw an expansion for 9MFY2025, compared to 1HFY2025.
See also: DBS says CAO is a 'buy'; flags capital inefficiency and prospect of higher dividends
In particular, the office portfolio's rental reversion increased to 6.5% from 4.8%, driven by Capital Tower and Six Battery Road.
While CICT’s management expects rental reversions in both office and retail segments to ease to the low to mid single digits, Lee views this as slightly conservative, given strong leasing momentum in both markets.
With progressive handover to its anchor tenant, the European Central Bank, Galileo, the Frankfurt property will see contributions in 2026.
Finally, Maybank analyst Krishna Guha is holding onto his “buy” call for CICT with a higher target price of $2.55 from $2.35 previously.
Guha likes CICT’s steady operations, characterised by high occupancy and positive reversion for CICT in the latest 3QFY2025 business update.
CICT’s occupancy rate picked up for offices, led by overseas assets, while retail occupancy was stable. At the same time, rental reversion picked up for office and continued at a high single digit range for retail.
Gearing ratio inched up due to the acquisition of the remaining stake in CapitaSpring while cost of debt fell and is guided to trend lower.
CICT has also guided that occupancy rate is finding a floor while incentives staying elevated but stabilising for the overseas offices.
Units in CICT last traded 2 cents higher, or 0.83% up, at $2.42.
