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Mapletree Logistics Trust to acquire Vietnam warehouse for S$43m
MAPLETREE Logistics Trust will be acquiring a warehouse in the Vietnam-Singapore Industrial Park I located in Binh Duong province, Vietnam for approximately S$43 million.
Upon completion of the acquisition, the property will be leased to Unilever Vietnam for 10 years.
The property is designed with Grade A building specifications, including minimum clear height of 10 metres and floor loading capacity of 30kN/sqm, which are in line with international standards and requirements of logistics and warehousing operators. Comprising three connected blocks of single-storey warehouses, the property has a gross floor area of about 66,800 sqm and land area of 101,200 sqm.
Its latest property acquisition is located in Vietnam's Southern key economic region. Binh Duong province is the largest logistics hub in southern Vietnam accounting for over half of its total supply. The province is a thriving manufacturing hub that has attracted many multinational corporations from Europe, the US and Asia. The strong growth in industrial activities has supported the demand for modern warehousing facilities.
After the completion of the sale, Mapletree Logistics Trust will have a total of four properties in Vietnam, comprising three in southern Vietnam and one in the north.
The acquisition is expected to generate an initial net property income yield of 8.3 per cent. It is also expected to be accretive at the distribution level.
The property has been valued at 730 billion Vietnamese dong by Cushman & Wakefield as at May 18, 2018 based on the income capitalisation and direct comparison methods.
The acquisition will be funded by debt and is expected to be completed by 4QFY18/19, subject to fulfilment of the relevant conditions precedent, which includes the issuance of a new land use right certificate to Mapletree First Warehouse (Vietnam).
Upon completion, Mapletree Logistics Trust's aggregate leverage ratio will be approximately 38.9 per cent, while its total portfolio will comprise 140 properties with a book value of approximately S$7.7 billion.
Ng Kiat, CEO of Mapletree Logistics Trust's manager, said: "The addition of this well-located Grade A facility, our fourth property in Vietnam, will also enhance our ability to tap the rising demand for quality logistics facilities in one of the fastest growing markets with strong domestic consumption."