Mapletree Logistics Trust to acquire facility in South Korea for 135b won

Claudia Chong

Published Wed, Oct 20, 2021 · 08:57 PM

MAPLETREE Logistics Trust (MLT) is acquiring a 2-year-old logistics facility in South Korea for 135 billion Korean won (S$153.8 million) to boost its strength in the e-commerce market.

The property, Yeoju Logistics Centre, spans over 70,400 square metres in total gross floor area and sits on 56,200 sq m of freehold land. It has 2 blocks of 3-storey dry warehouses and is fully leased to one of South Korea's largest online fashion platforms and a domestic third-party logistics service provider.

"With a weighted average lease expiry (by net lettable area) of approximately 3.1 years and built-in annual rent escalations, the acquisition will provide MLT with a stable and growing income stream," the manager said.

MLT's e-commerce revenue exposure in South Korea is expected to rise to 31 per cent from 24 per cent following the acquisition. The transaction is also estimated to generate a net property income yield of 4.2 per cent based on the property purchase price and is expected to be accretive to MLT's distribution per unit.

The logistics facility is located in northern Yeoju, a newly established logistics hub with efficient access to 2 major expressways connected to Seoul. With the addition of the facility, MLT's portfolio in the Seoul metropolitan area will be increased to 19 assets.

The acquisition is expected to be completed by end-2021. Assuming it is fully funded by debt, MLT's aggregate gearing ratio will be 40.3 per cent.