CapitaLand Integrated Commercial Trust - Annual Report 2021

balance 23.1% of leases due for renewal in 2022. In 4Q 2021, Singapore officemarket rents continued to increase, a trend which started since2Q2021. The last quarter of the year saw increased leasing enquiries for expansion and new set up in our portfolio. New office leases and renewals were signed at above market rents, but below the respective expiring rents in 2021. Meanwhile, we witnessed an improving trend in retail rental reversion during the year, although downtown malls were more impactedby thenegative reversions than their suburban counterparts. The improving market rents in Singapore is expected to narrow the gap between CICT’s signing and expiring rents. Monthly average shopper traffic at our malls for FY 2021 was consistent with that for FY 2020. However, the monthly average shopper traffic for FY 2021 was 61.2% of the monthly average for FY 2019. Retail tenant sales per square foot recovered stronger at 87.8% of FY 2019’s monthly average and was on par with that of FY 2020. The total tenants’ sales recorded for FY 2021 increased 12.2% on a year-on-year basis. Armed with strong fundamentals and a well-diversified, quality portfolio, CICT is well placed to ride the waves of recovery. We remain firmly committed to delivering stable distributions and sustainable total returns to our Unitholders. REJUVENATING OUR ASSETS As part of our ongoing efforts to refresh offerings and enrich experience at our malls, we engaged in various asset 5 As announced on 23 December 2021, the Implied NPI is based on the pro forma 1H 2021 annualised NPI of 101-103Miller Street and Greenwood Plaza, 66 Goulburn Street and 100 Arthur Street and taking into account the following assumptions: (a) the acquisitions of the two trusts holding 66 Goulburn Street and 100 Arthur Street as well as 101-103 Miller Street and Greenwood Plaza were completed on 1 January 2021 and held and operated to 30 June 2021; (b) including rental guarantee for 100 Arthur Street; and (c) the tenants and committed tenants of 100 Arthur Street as at 30 September 2021 were in place on 1 January 2021. enhancement initiatives (AEIs). Lot One Shoppers’ Mall unveiled a new cinema and a sustainability- focused library in the second half of 2021. In a first for a Singapore library, the latter featured a Green Grove with an Augmented Reality Learning Trail exhibiting Singapore’s wildlife and natural landscapes. CapitaLand Hope Foundation (CHF) contributed S$500,000 to this green showcase, extending its support beyond children and seniors in need to environmental causes. Six Battery Road received a new through-block link flanked by a banking hall with assisted and self-help services and upcoming exciting retail offerings. Office workers at the property can look forward to new F&B brands in the first half of 2022. These include Bar.celona Cava & Tapas restaurant and a new concept by Foragers, the owners of the Miznon and Carrotsticks & Cravings restaurants. Having handed over 21 Collyer Quay to WeWork for their own fit- out works, it will begin offering enterprise solutions and coworking options at the office building in 3Q 2022. Meanwhile, CapitaSpring obtained a Temporary Occupation Permit for the whole development in November 2021. We have already achieved 93% committed occupancy as at 9 February 2022, with 14 tenants having started operations, and more are in the midst of fitting out the premises. The integrated development’s serviced residences have opened its doors to guests on 1 February 2022. In January 2022, we commenced an AEI at Raffles City Singapore. The rejuvenation of the ex- anchor tenanted area will see the reconfiguration of 111,000 sq ft fromLevels 1 to 3 into smaller units for large format and specialty retail. Shoppers will enjoy better vertical connectivity within these levels with the addition of a new set of escalators. Scheduled for completion in 4Q 2022, the revamped space presents an exciting opportunity to refresh our retail tenant mix with both homegrown and premium international brands, including key international fashion, beauty and lifestyle retailers. As we fortify our foundations, CICT will continue to focus on strengthening our portfolio, while staying ahead of the curve through innovative AEIs and adoption of technology to enhance shopper experience anddrive value creation. RECONSTITUTING OUR PORTFOLIO At CICT, we regularly review and evaluate our portfolio with the aim of maximising value for our Unitholders. Guided by a forward- looking portfolio reconstitution strategy, we actively explore DPU- accretive investments, enhancement opportunities and capital recycling through potential divestments. In 4Q 2021, we kick-started our active portfolio reconstitution plan by divesting our 50.0% interest in One George Street, at an exit yield of 3.17% per annum. The capital was recycled to partially finance three higher yielding assets in Sydney, Australia, at a combined implied NPI yield of 5.1% 5 . Marking CICT’s first inroad into Sydney Australia, the second overseas developed market after Germany, the acquisition of 66 Annual Report 2021 15 Message to Unitholders