CapitaLand Trust sells Asia Square Tower 2, buys Paragon

The divestment will be completed by H2 2026.

CapitaLand Integrated Commercial Trust (CICT) will divest Asia Square Tower 2 (AST2) for around $2.47b and acquire Paragon for about $3.90b, subject to unitholder approval and completion conditions.

In a press release, Tan Choon Siang, Chief Executive Officer of the manager of CICT, said AST2 will be sold to IOI Marina View Pte. Ltd. The asset was valued at about $2.25b as at 31 December 2025, representing a 9.9% premium to that valuation.

The divestment is expected to complete in the second half of 2026, subject to shareholder approval by the purchaser and tax confirmation from the Inland Revenue Authority of Singapore.

The acquisition is expected to generate a net yield of 3.9% and accrete distribution per unit by 2.1%.

CICT said Paragon will be acquired from Cuscaden Peak-related entities, with the property comprising retail, office, and medical components along Orchard Road.

It has a net lettable area of 66,417 square metres and reported committed occupancy of 100% across retail and medical and office spaces as at January 2026.

CICT said it will fund the acquisition through debt, private placement proceeds, and net proceeds from the AST2 divestment.

A bridging loan will also be used if the acquisition completes before the divestment, with the manager receiving part of the acquisition fee in units.

Following the transactions, CICT’s pro forma aggregate leverage is expected to be 39.2%, based on 31 December 2025 figures.

The acquisition constitutes an interested party transaction and requires unitholder approval at an extraordinary general meeting.