In his Feb 2 report, Natarajan highlighted several positives for the REIT. These include a brighter hospitality outlook in Singapore this year. Performances in Australia and New Zealand are expected to strengthen following recent renovations and a stronger demand outlook. In Singapore, the analyst expects the portfolio’s revenue per available room (RevPAR) to grow by 3% to 5% y-o-y in FY2026, supported by higher visitor arrivals, a stronger events and concert pipeline, and a moderate hotel supply compound annual growth rate (CAGR) of 1.7% per annum from 2026 to 2028.
CDLHT’s UK living sector assets are also expected to deliver higher income after their gestation period. Meanwhile, the Maldives portfolio is likely to remain a drag due to competition and the gestation period for its newly opened The Halcyon. Hotels in Germany and Italy are expected to remain flattish, says Natarajan.
During the year, CDLHT benefited from declining finance costs, which fell by 100 basis points following a steep drop in the Singapore overnight rate average (SORA), aided by the REIT’s high proportion of floating interest rate loans. Additionally, CDLHT issued $150 million worth of perpetual securities at a coupon rate of 3.75% per annum in November 2025. The proceeds were used to pay down some of its expensive overseas loans. Natarajan expects CDLHT’s finance costs to be around 3% in FY2026.
With these factors, Natarajan has raised his FY2026 DPS estimate by 2% to 5 cents, representing an 8.2% y-o-y growth. This is driven by higher contributions from assets in Singapore, the UK, and New Zealand, coupled with lower interest costs. CDLHT’s portfolio valuation as at end-December 2025 rose by 0.8% y-o-y, reflecting slight cap rate compression across most markets and a change in valuer.
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The analyst has also increased his FY2027 DPS estimate by 4%. The DPS growth for both years reflects RevPAR assumptions from Singapore and lower interest costs.
“[CDLHT’s] share price has underperformed over the last 12 months, and we see room for a rebound (trading at 0.6 times P/BV),” he writes.
FY2026 likely to do better; Moxy acquisition deal structure ‘key’ to FY2027 DPS accretion: CGSI
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CGSI analysts Li Jialin and Lock Mun Yee also expect FY2026 to be a better year for CDLHT, driven by multiple factors. These include the completion of W Singapore’s asset enhancement initiative (AEI), completed AEIs at Ibis Perth and the Grand Millennium Auckland, and the opening of the New Zealand International Convention Centre (NZICC) near the New Zealand hotel. The analysts have maintained their “add” call with a higher target price of 90 cents, up from 87 cents.
CDLHT’s Japan hotels are likely to see stable to positive performance y-o-y in FY2026 after coming from a lower base in FY2025 due to one-off events. In the UK, the built-to-rent Castings is expected to further ramp up and reach stabilisation in FY2026. Properties in the UK, Germany, Italy, and the Maldives are expected to see “broadly stable performance” this year.
For FY2027, the analysts expect the deal structure of the Moxy Singapore Clarke Quay acquisition to be “key” to DPS accretion. CDLHT is likely to acquire the 475-key hotel once it completes by end-2026. Under the forward-purchase agreement signed in 2019, the REIT will purchase the property at a fixed price of $475 million or 110% of development costs, whichever is lower. Li and Lock expect the REIT to finance the purchase with a 70:30 debt-to-equity ratio. According to management, CDLHT has a debt headroom of $819 million before reaching the regulatory limit of 50%, which the analysts deem adequate to support DPS accretion.
Like Natarajan, Li and Lock note that CDLHT’s FY2025 DPS exceeded their expectations, reaching 108% of their full-year forecast. The analysts have raised their FY2026 DPS estimate by 1.8%, but lowered their FY2027 DPS estimate by 2.1%, mainly due to updated assumptions on Moxy Singapore Clarke Quay.
Citi maintains ‘sell’, but sees 2HFY2025 results a ‘first sign of relief’
Citi Research analyst Brandon Lee is maintaining his “sell” rating on CDLHT with an unchanged target price of 60 cents, even as the REIT’s 2HFY2025 results suggest a “first sign of relief” for the Singapore hospitality sector.
CDLHT’s net property income (NPI) returned to growth in the second half of the year with DPS up by 0.4% y-o-y and 42.4% up h-o-h to 2.82 cents, Lee notes. The half-year DPS made up 62% of Lee’s full-year estimates, which is “consistent” with the second half of the year being a stronger part of the year.
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Among the positives, Singapore posted double-digit RevPAR growth in 4QFY2025 following continued declines in the first three quarters of the year. RevPAR also improved in Australia, New Zealand and Japan.
On the downside, RevPAR fell in Germany and the UK while the committed occupancy rate at purpose-built student accommodation (PBSA) Benson Yard fell.
On this, Lee believes there may be a positive share price impact on the return to RevPAR growth in CDLHT’s major domestic and overseas hospitality markets.
CDLHT should consider selective divestments to fund Moxy Singapore Clarke Quay: DBS
DBS Group Research's Geraldine Wong, who has a "buy" call and unchanged target price of $1, sees CDLHT's results as having improved "meaningfully" in the latter half of the year. However, CDLHT's full-year DPS still fell short of Wong's estimate of 5.29 cents.
In FY2026, Wong sees the completion of AEIs fuelling a recovery in the REIT’s earnings.
The forward purchase of Moxy Singapore Clarke Quay will be “closely watched”, with the move adding 475 keys to CDLHT’s Singapore portfolio from 2027.
The agreed purchase price seems “attractive” compared to recent transactions. To this, Wong believes funding options include a mix of perpetual securities, debt and equity, although with the unit price trading below net asset value (NAV), preference is likely for debt and perps.
Selective overseas divestments could also be explored to partially bridge the funding gap, she says. “The asset was underwritten at a stabilised yield in the mid-5% range, with potential valuation uplift upon completion should market cap rates compress towards [around] 4.5% for hospitality assets.”
“In the interim, capital discipline remains evident, with management prioritising balance sheet capacity for Moxy over new acquisitions,” she adds.
Though CDLHT benefitted from the lower interest costs, the full benefits have yet to fully flow through, which is a “key” FY2026 catalyst, notes Wong, as she estimates CDLHT’s average debt cost to decline to 3% from FY2025’s 3.5%.
Units in CDLHT closed 1 cent higher or 1.16% up at 87.5 cents on Feb 2.
