CapitaLand Ascott Trust 178 Notes to the Financial Statements For the financial year ended 31 December 2025 6 Investment Properties Under Development CapitaLand Ascott REIT Group and Stapled Group 2025 $’000 2024 $’000 At 1 January 279,000 268,000 Development costs and interest capitalised(1) 36,394 10,346 Net change in fair value of investment properties under development 6 654 At 31 December 315,400 279,000 (1) Capitalised costs included $77,000 (2024: $150,000) paid/payable to related parties and borrowing costs of $103,000 (2024: $53,000). 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 measurement for the investment properties under development have been categorised as level 3 fair values based on inputs to the valuation techniques used. 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 marketcorroborated 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. The following table shows the significant unobservable inputs used in the valuation models: Valuation technique Significant unobservable inputs Inter-relationship between key unobservable inputs and fair value measurement Under the residual land value method of valuation, the total gross development costs and developer’s profit are deducted from the gross development value to arrive at the residual value of land. The gross development value is the estimated value of the property assuming satisfactory completion of the development as at the date of the valuation. Stapled Group • Discount rate: Singapore 5.66% (2024: 5.32%) • Terminal capitalisation rate: Singapore 3.50% (2024: 3.50%) • Gross development costs: Singapore $149,260,000 (2024: $138,540,000) The estimated fair value would increase (decrease) if: • the discount rate was lower (higher); • the terminal capitalisation rate was lower (higher); or • the gross development costs decrease (increase).
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