Notes to the Financial Statements Year ended 31 December 2024 6 INVESTMENT PROPERTIES UNDER DEVELOPMENT CapitaLand Ascott REIT Group and Stapled Group 2024 2023 $’000 $’000 At 1 January 268,000 385,707 Development costs and interest capitalised (1) 10,346 42,343 Transfer to investment properties (Note 4) – (162,223) Net change in fair value of investment properties under development 654 4,075 Translation differences – (1,902) At 31 December 279,000 268,000 (1) Capitalised costs included $150,000 (2023: $160,000) paid/payable to related corporations and borrowing costs of $53,000 (2023: $4,402,000). Somerset Liang Court Property Singapore, with a gross floor area of about 13,000 square metres, is currently under development into a serviced residence with hotel licence. The Stapled Group owns a 100% interest in the property. Site works commenced in mid-July 2021 and foundation piling works were completed in 2022. Substructure works were completed in 2024. The property is on track to be completed in 2026. Fair value hierarchy The fair value of investment properties under development is determined by external property valuers, having appropriate recognised professional qualifications and recent experience in the location and category of properties being valued. The fair value measurement for the investment properties under development have been categorised as level 3 fair values based on inputs to the valuation techniques used. Level 3 fair values Reconciliations from the beginning balances to the ending balances for fair value measurements of level 3 are set out in the table above. Valuation technique and significant unobservable inputs Investment properties under development is stated at fair value based on valuation performed by external property valuers. In determining the fair value, the valuers have adopted the residual land value method. The key assumptions used to determine the fair value of investment properties under development include market-corroborated discount rate, terminal capitalisation rate, capitalisation rate and gross development costs. The valuation of the Stapled Group’s investment property under development portfolio is discussed with the ARC and Board of Directors in accordance with the Stapled Group’s reporting policies. 182 CapitaLand Ascott Trust
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