City Developments Shares Drop After Strategic Review Outlines S$6 Billion Asset Sale
Shares of the Singaporean property developer, controlled by Kwek Leng Beng, fell 6.3% intraday after its new three-year strategy detailed plans to divest S$6 billion in assets and target S$5 billion in fresh investments.
CDL Shares See Steep Decline
City Developments Limited (CDL), the Singapore-listed property developer controlled by billionaire Kwek Leng Beng, saw its shares fall sharply on Monday following the release of its strategic review. The stock slid by as much as 6.3% during the trading session, marking its steepest intraday decline since mid-March this year.
By midday on Monday, CDL shares were trading at S$7.79 (US$6.1), a 5.7% drop from Friday's closing price, according to The Business Times. This market reaction came a year after a high-profile boardroom dispute within the firm.
New Strategy Targets Asset Divestments, Fresh Investments
The strategic review, named GET+, outlines a three-year roadmap for CDL. It includes plans to divest S$6 billion (US$4.7 billion) in assets across residential, commercial, hospitality, and living sectors.
Group CEO Sherman Kwek noted that the disposals would include a retreat from Australia, a market he described as having "not really worked out too well for us," as quoted by Bloomberg. Concurrently, the strategy targets S$5 billion in new investments, with 60% allocated to Singapore, 30% to China and Japan, and the remainder to other markets, according to CDL's press release.
Financial Goals and Boardroom Context
CDL also aims to establish a dedicated fund management business, targeting a doubling of assets under management (AUM) to S$10 billion by 2029. Other financial objectives include an annual dividend payout ratio of at least 35% of reported net profit and a net gearing ratio of approximately 55% by 2029. The firm's net debt-to-equity ratio stood at 75% in the first half of 2026.
Sherman Kwek had previously called the review "timely," acknowledging difficulties faced by the firm last year, including an internal dispute with his father and executive chairman, Kwek Leng Beng.
Market Reacts to Unanswered Questions
While some analysts responded positively, with DBS Group Holdings analyst Tabitha Foo welcoming CDL's "much clearer value unlocking roadmap," as reported by Bloomberg, and Citigroup maintaining a buy rating, the stock's drop suggests investor caution.
RHB Bank analyst Vijay Natarajan, cited by The Straits Times, indicated that high expectations were already priced in, with broader market conditions and interest rate outlooks weighing on sentiment. Natarajan also highlighted that the review did not address boardroom tensions, CEO performance targets, or succession planning, issues that have been subjects of market debate.
This article is journalism, not investment advice; consult a licensed professional before making financial decisions. Market data is indicative, may be delayed, and should be verified with your broker or exchange before use.
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