CapitaLand Commercial C-REIT’s (CLCR) upcoming initial public offering (IPO) on the Shanghai Stock Exchange has attracted 254.5 times subscription coverage from offline institutional investors in the bookbuilding tranche, marking a record high among retail C-REITs in China.
In China, institutional investors participating in the bookbuilding exercise are referred to as offline institutional investors, while those subscribing through the public tranche are known as online institutional investors.
The IPO also saw strong retail interest; the public tranche closed ahead of schedule and was 535.2 times subscribed, according to a Sept 12 announcement.
With 400 million IPO units issued at a price of RMB5.718 ($1.03) per unit, CLCR has raised RMB2.29 billion, or some $409 million, a 7% increase from the initial estimate of RMB2.14 billion.
CLCR will be CLI’s eighth listed fund. As joint strategic investors of CLCR, CapitaLand Investment (CLI), CapitaLand China Trust (CLCT) and CapitaLand Development (CLD) will collectively hold 20% of the IPO units.
Cornerstone investors took up 40.11% of the units. Offline institutional investors were allotted 27.92% in the bookbuilding tranche, while the remaining 11.97% was subscribed by retail and institutional investors in the public tranche.
Excluding the stakes to be held by CLI, CLCT and CLD, the majority of the IPO units were taken up by insurance companies, strategic capital investors and securities firms, according to CLI.
CLCR is expected to commence trading under the ticker code 508091 by the end of the month as China’s first international-sponsored retail C-REIT.
CLCR will focus on “high-quality income-producing retail assets in top-tier cities”. Its initial portfolio will comprise two retail assets: CapitaMall SKY+ in Guangzhou and CapitaMall Yuhuating in Changsha, with a combined value of approximately RMB2.6 billion.
See also: CLI's China REIT to list by end of year; to raise $375 million issuing 400 million units
CapitaMall Yuhuating in Changsha
The malls span a total gross floor area of 168,405 sqm, with an overall occupancy rate of 96% as at end-March.
As the sponsor and asset manager of CLCR, CLI will continue to operate CapitaMall SKY+ and CapitaMall Yuhuating post-listing.
According to CLI, CLCR complements CLCT, CLI’s Singapore-listed fund for international investors looking to invest in China. This “dual-platform approach” will attract “diverse capital sources” and provide both domestic and international investors with access to quality assets in China, says CLI.
CLI shares closed 1 cent lower at $2.77 on Sept 11.
Read more about CapitaLand Commercial C-REIT:
CLI's China REIT to list by end of year; to raise $375 million issuing 400 million units
