The Shocking Announcement by Capitaland Integrated Commercial Trust To Acquire Paragon From Cuscaden Peak.

I am shell shocked by the announcement from Capitaland Integrated Commercial Trust ("CICT") that it will be acquiring Paragon from Cuscaden Peak. As a former unit-holder of SPH REIT and later on the renamed Paragon REIT, I vividly recalled a year ago, the Cuscaden Group folks said that Paragon need S$500Mil to S$600Mil for a major facelift and refurbishment to fight off the intense competition at Orchard Road. Henceforth, there will be a huge loss of income for all unit-holders of Paragon REIT for up to 4 years during this major facelift. The best option recommended was a privatisation then with Paragon valued at S$2.9 billion. In less than 1 year after Cuscaden taken Paragon REIT private, they have suddenly decided not to go ahead with the facelift but instead chose to sell Paragon to CICT for S$3.9 billion. Personally, I thought that all ex-Paragon retail unitholders have been played out by Cuscaden Group. Interestingly, Cuscaden Group is made up of 3 major corporate shareholders who are, HPL Hotel (lead by the famous Mr Ong Beng Seng), Mapletree and lastly, Capitaland itself which is affiliated to CICT.

Extract of Announcement by CICT on 20 April 2026

1. Screwing Unit-holders of Paragon REIT

To put it bluntly based on my personal thoughts, the privatisation move made to "market and influence" Paragon Unit-holders last year was nothing more than a show with the grand purpose to remove the numerous unit-holders so that a restructuring of the Paragon Property can be completed in order to sell it off. Under Paragon REIT, Paragon is just a 99 year leasehold whereby the free-hold title was being withheld by the then Singapore Press Holdings. By taking Paragon REIT private, Cuscaden can then proceed to merge it back into a wholesome freehold investment property for spinning off at a large profit to other potential buyers.  

Unfortunately for retail investors, everything was done legally. The "privatisation" was an option that more than 75% of unit-holders agreed to during the EGM....it was not at gun-point. Ex-Paragon Unit-holders do not have access to other information or possible better business alternatives at that juncture. 

Additionally, the Cuscaden folks, would simply argue that after this move was made, Capitaland folks then suddenly have an "Eureka" moment that its CICT maybe can buy over a freehold Paragon that leads to a win-win situation for both Cuscaden and Capitaland. Perfect!  

2. Screwing Unit-holders of CICT

Tragically for CICT retail unit-holders, they cannot feel the victory of scoring a major goal in acquiring a freehold Paragon with the very much coveted Medical Suites tenants and its stream of very resilient rental income. There is a huge price tag of S$3.9 billion and worse still, CICT unit-holders are unable to participate in any preferential rights issuance as the management of CICT decided to go with a private placement at a discount to private institutions to fill up the fund raising gap required to complete the deal.

In addition, there maybe a need for a 4 years facelift that may cost an additional S$500Mil to S$600Mil as per the management of Cuscaden Group (making up of veterans in real estate HPL, Mapletree and Capitaland). CICT unit-holders may have to bear the execution risk in such an event. 

Nevertheless, on a personal front, I have serious doubt that CICT will want to spend another half a billion CAPX for such asset enhancement. 

3. Parting Thoughts

From an investment perspective, I will not be investing in CICT. Personally, I do not like the office component present in CICT as my preference is more on a retail concentrated REIT.