CapitaLand Investment books 33% growth in fees related earnings in Q3, establishes 2 new funds
CAPITALAND Investment (CLI) booked a 33 per cent growth in fee-related earnings (FRE) for Q3 FY21 to S$94.6 million from S$71.1 million a year ago in its first business update since listing on the bourse in September.
In a bourse filing on Wednesday (Nov 3), CLI said the growth was driven in part by the 9 per cent rise in funds under management (FUM), from S$77.6 billion as at end-December to S$84.3 billion as at end-September.
Capital recycling also drove growth in FRE, with divestments growing 4 times from S$3 billion to S$12.3 billion. This resulted in a 9 times increase in event-driven fees to S$52 million for the year-to-date September 2021.
The lodging management business also reported year-on-year growth of 33 per cent of revenue per available unit, with occupancy of around 60 per cent for Q3 FY21.
In a separate announcement on Wednesday, CLI has established 2 private funds in Japan and South Korea to grow its funds under management by S$688 million. The Japan fund has acquired the real estate investment manager's 2 existing commercial assets while the South Korea fund has acquired 2 operating cold storage logistics properties from an unrelated third party.
CLI has invested alongside capital partners and obtained a minority stake in both funds.
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The Japan fund has a FUM of about 44.1 billion yen (S$537.7 million), with CLI having a 4.98 per cent stake in the fund. The real estate investment manager will remain as the asset manager of office buildings Yokohama Blue Avenue and Shinjuku Front Tower, of which the fund owns 50 per cent and 20 per cent of, respectively.
The South Korea fund has a FUM of 127.1 billion won (S$150.3 million), with CLI having a 5 per cent stake. The 2 operating cold storage logistics properties are on long-term master leases with Foodist, a nationwide food wholesaler, generating fee-related income immediately.
"Our FUM has increased to S$84.3 billion, placing us on track to meet our FUM target of S$100 billion by 2024. CLI will also receive recurring fee-related earnings through the management of the 2 funds and their assets," said Lee Chee Koon, group chief executive officer, CLI.
Shares of CLI closed down 0.9 per cent or S$0.03 to S$3.43 on Tuesday (Nov 2).
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