The transformation of the Jurong Lake District
During the National Day Rally last Sunday, PM Lee highlighted the Jurong Lake District as an area in Singapore which he planned to further transform. The new Jurong Lake Gardens will be formed by integrating the Chinese and Jurong Gardens and Jurong Lake Park, with an area size of more than 70 ha.
The Jurong Lake District neighborhood will also see enhancements with the addition of more developments, such as a new Science Centre, which will be located near Chinese Garden MRT and expected to be ready by 2020. We believe the transformation of the Jurong Lake District will be positive for developers with real estate exposure in the area. In particular, we highlight that CapitaLand and CapitaMall Trust operates three large retail malls (IMM, J-Cube and Westgate) in the area. Together, these assets comprise a whopping 1.0m sq ft of operational retail net leasable area, and we believe the group finds significant synergies in positioning these three assets as a “3-in-1” retail proposition that caters for a wide range of shoppers in Singapore’s largest regional hub.
We have BUY ratings on CapitaMall Trust and CapitaLand with fair value estimates of S$2.20 and S$3.79, respectively.
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