CDL to unlock hidden empire worth $6b for growth, targets dividend payout of over 35%

SINGAPORE – Hotel and property group City Developments Limited (CDL) will be unlocking $6 billion in mature and non-core assets and redeploying the capital to drive growth.

It will also target an annual dividend payout of more than 35% of reported profit after tax and minority interests over the next three financial years.

Shares of CDL were trading at $7.84 at , down by more than 5%, after announcing a much-anticipated strategic review in which the developer revealed that the roughly $6 billion worth of assets could be unlocked through divestment, securitisation or optimisation.

The targeted asset divestment mix comprises 45% commercial assets, 30% hospitality, 20% legacy residential and other assets, and 5% from the living sector assets.

In addition to the divestment proceeds, CDL expects more than $6 billion of projected cash inflows through to financial year 2029 from property development sales, supported by future cash collections from contracted sales and its existing development pipeline.

These projected cash inflows are in addition to the $6 billion divestment target.

Under GET+ – a three-year refreshed strategy for 2027 to 2029 – CDL targets to deploy $5 billion of growth capital across the four sectors and into markets where the group has established capabilities, local knowledge and opportunities to generate attractive risk-adjusted returns.

Singapore will remain the principal market for new investments.

About 60% of the funds will be targeted for deployment in Singapore, 30% in China and Japan, and 10% in other markets.

Sherman Kwek, CDL’s chief executive, said during a press conference that despite the China property market remaining weak, Shanghai, where demand from high networth individuals for luxury properties, remains a growth area for the group.

Hospitality will also be a key area of focus under its GET+ strategy. CDL wants to optimise its hotel portfolio by keeping the best assets, upgrading promising ones, and selling selected properties to unlock cash or value.

CDL plans to sell about $1.8 billion worth of hotels by financial year 2029, which would make up 30% of its overall $6 billion divestment target. When asked, CDL officials were unable to reveal the hotels earmarked for divestment.

The group has a global portfolio of 165 hotels with around 48,000 rooms, including 88 owned hotels.

Of these, 54 hotels, including two opening in the next 12 months, are directly held by CDL and valued at around $8.6 billion. This excludes hotels under CDL Hospitality Trusts and Millennium and Copthorne Hotels New Zealand Limited.

The GET+ strategy also targets to deliver a dividend payout ratio of at least 35% of reported profit after tax and minority interests (PATMI) annually from FY2027 to FY2029; 55% net gearing by financial year 2029; more than $1 billion PATMI to be realised from divestment gains; and $10 billion in assets under management (AUM) by financial year 2029 from $5 billion in AUM as of Jun 30, 2026.

Fund management will become a more significant part of CDL’s capital model, comprising new and existing listed real estate investment trust platforms and an expanded private capital platform via funds, partnerships and joint ventures.

Kwek Leng Beng, CDL’s executive chairman, said in a statement that the strategic review sharpens the group’s priorities and sets a clear direction.

The elder Kwek, who is also Sherman’s father, was not present at the press conference.

Sherman added that the road map and measurable outcomes offer greater accountability for what CDL needs to deliver as the group works to strengthen its balance sheet, improve capital productivity and build a higher quality earnings base to maximise shareholder value.

On why CDL’s shares fell, RHB analyst Vijay Natarajan said expectations for the strategic review had already been priced in, while weak market conditions and the interest rate outlook weighed on sentiment. Investors may also be waiting for more detail on how the group will execute the plan.

He noted that the review did not address boardroom issues or how the chief executive’s performance targets and remuneration would be tied to the strategy, despite market debate over both matters.

The strategic review, which aims to optimise the group’s global portfolio and capital allocation priorities, was first announced at its earnings briefing in February 2026.

Global advisory firm Teneo had been engaged to start the assessment process around September 2025, and was initially slated to complete it by June.

Sherman said CDL’s board was united behind the review, which was “timely”, given the internal disputes between him and his father in 2025.

In February 2025, Kwek Leng Beng filed a lawsuit, accusing his son of an attempted boardroom coup.

The public dispute between father and son lasted for about two weeks, before the older Kwek dropped the suit in mid-March 2025.

It was resolved by August 2025, when the older Kwek said CDL’s executives had “put past issues behind us”, and that the board and management were aligned on effective execution and value creation.

CDL has aggressively accelerated its capital recycling efforts, yielding $2 billion in contracted divestments in 2025. The contracted divestments included the sale of Quayside Isle@Sentosa Cove, which was completed in February 2026.

source: The Straits Times https://www.straitstimes.com/business/cdl-to-unlock-hidden-empire-worth-6b-to-deploy-into-better-yielding-assets?ref=top-stories