\n<\/p>\n
Analysts also noted that Paragon is currently operating at full committed occupancy across both segments.<\/p>\n
This reflects sustained tenant demand and the mall\u2019s ability to attract and retain a strong mix of occupiers across different uses, said Mr Sandrasegeran.<\/p>\n
\u201cThe retail component benefits from a curated mix of international brands and lifestyle offerings, while the medical and office segment is supported by more stable, needs-based demand. Together, this diversified tenant base helps to smooth income volatility across market cycles,\u201d he added.<\/p>\n
As an asset, Paragon offers a high degree of income visibility, supported by consistent rental streams and limited vacancy risk, he said, noting that this stability is particularly attractive to investors.<\/p>\n
Since the agreed value of S$3.9 billion is closely aligned with the two valuations by Knight Frank and Cushman & Wakefield at S$3.895 billion and S$3.905 billion respectively, the price appears to be \u201canchored to market fundamentals\u201d.<\/p>\n
\u201cOverall, while the headline figure is sizeable, it reflects a combination of rarity, prime location, asset quality and income resilience.\u201d<\/p>\n
Investors buy commercial developments for two reasons \u2013 stability or to add value. For example, some investors may buy a mall with 80 per cent occupancy with plans to increase occupancy rates to earn their premiums, said Mr Sim.<\/p>\n
In the case of Paragon, which has 100 per cent occupancy across its components, investing is a \u201cstable call\u201d, he added.<\/p>\n
\u201cThat means I do not need to do anything, with my portfolio in CapitaLand, I\u2019m confident that if it falls to 99 per cent, I can easily rack it up to 100 per cent,\u201d said Mr Sim, noting that rental growth would be what brings value to investors.<\/p>\n
Since CICT owns many malls and has a lot of experience, it likely has a pipeline of clients and can offer stability as a landlord. The company will be confident that other retailers will step in should tenants leave, he added.<\/p>\n<\/div>\n