Several brokerages have raised their target prices for property developer CapitaLand and Ascott Residence Trust stocks to reflect likely gains from the recent property transactions.

OCBC Investment Research increased its target price for Ascott Residence Trust to S$1.23 from S$1.14 and kept its 'buy' rating, while CIMB Research raised it to S$1.19 from S$1.18, maintaining its 'neutral' rating.

Ascott Residence units were down 1.3 percent at S$1.135, and have risen 17 percent so far this year.

Ascott Residence said on Monday it will sell its Singapore asset Somerset Grand Cairnhill to CapitaLand for S$359 million, which will be redeveloped. Ascott Residence plans to buy the serviced residence portion of the development back from CapitaLand for S$405 million, with delivery expected in 2017.

Ascott Residence will also buy two properties - Ascott Raffles Place Singapore and Ascott Guangzhou - from CapitaLand for S$283.3 million.

"We believe Ascott Residence could have secured better divestment and acquisition pricing and accretion had it divested just the residential portion of (Somerset Grand Cairnhill) to third-parties and kept the hotel portion for its own development," said CIMB in a report.

The brokerage also raised its target price for CapitaLand to S$3.64 from S$3.61 and kept its 'buy' rating.

CapitaLand shares were up 1.4 percent at S$2.93, and have gained nearly 32.6 percent since the start of the year, versus the Straits Times Index's 11 percent rise.

"We view this transaction favorably as management continues to recycle capital and optimize use of assets," OCBC said. It increased its target price for CapitaLand stock to S$3.25 from S$3.21, and kept its 'buy' rating.

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0946 (0146 GMT)

(Reporting by Charmian Kok in Singapore; charmian.kok@thomsonreuters.com)