CapitaLand Malaysia REIT Management Sdn Bhd intends to lessen its reliance on retail segment by diversifying into industrial real estate, logistics and data centres over the next year.
CEO Tan Choon Siang said these segments would be the primary focus of the company because they could be potential new assets for the company and a pre-check on these sectors showed that they are resilient, particularly during the peak of Covid-19.
“Retail accounted for nearly all of our revenue, so we hope to see more industrial assets in our portfolio and our preference is definitely to lower the percentage of our retail that’s something that we hope to see…,“ he said during a virtual media briefing in conjunction with its fourth quarter financial results for the financial year 2021.
Tan revealed that Capitaland would then continue to focus on the Klang Valley in order to solidify its position before moving on to secondary cities such as Penang and Johor Bahru.
“Specifically we’re looking at the Klang Valley but we don’t rule out the possibility of locations like Penang and also Johor, which locations are stronger in terms of being nearer to the ports and able to be a distribution centre for regional distribution centres.
“Once we have more concrete information, we definitely can be a bit more concrete and we will share it,” he added.
Meanwhile, Capitaland Malaysia Trust’s (CLMT) net loss narrowed to RM30.93 million in the financial year ended 31 December 2021 from RM84.50 million a year ago.
Revenue fell 14.3% to RM224.11 million from RM261.34 million previously, mainly due to lower gross rental income, lower car park income, lower recovery of utilities and lower marketing communications income, the company said in a Bursa Malaysia filing.
Property operating expenses for FY2021 were RM121.0 million, a decrease of RM6.9 million, or 5.4 per cent from a year ago due to lower utilities and marketing expenses.
Utilities consumption was lower due to the various lockdowns, with a 10 per cent electricity discount for the entire FY21 versus only six months in FY20. Marketing expenses were also lower due to less mall activities and cost containment efforts, CLMT, which is managed by CapitaLand Malaysia REIT Management, said.
Net property income for FY21 was RM103.1 million, RM30.4 million lower than a year ago, a drop of 22.7%.
It has proposed a final income distribution of RM20.9 million, or 0.98 sen per unit (of which 0.26 sen per unit is taxable and 0.72 sen per unit is non-taxable), based on 2.13 billion units in issue from July 1, 2021 to Dec 31, 2021.
The manager expects the retail operating environment to remain challenging, given the current market conditions and ongoing global uncertainties arising from the pandemic, despite Malaysia’s inoculation progress.
“The manager will continue to work closely with tenants and stakeholders in navigating the pandemic challenges.
“CLMT’s focus remains to maintain a healthy portfolio occupancy and sustainable rental income, whilst pursuing inorganic growth opportunities in its existing and new asset classes, with financial discipline,” it added.