Mapletree S-Reits grow and diversify

WHAT started out over 20 years ago in 2000, to hold non-port properties transferred from PSA Corporation to Temasek Holdings, was the establishment of Mapletree Investment Pte Ltd (Mapletree). Since then, Mapletree a leading Singapore-based real estate development, investment, capital and property management group, has significant representation in the Singapore Reit market.

According to its annual report (as at March 31, 2020), Mapletree now owns and manages S$60.5 billion worth of office, retail, logistics, industrial, data centre, residential and lodging properties in 13 markets across the Asia-Pacific, Europe, the United Kingdom and the United States. Of its S$60.5 billion assets under management (AUM), about 70 per cent are third-party managed assets under a cluster of four listed S-Reits, that form over a fifth of Singapore Reits & Property Trusts' sector market capitalisation, and six private equity real estate funds. Its third-party managed AUM has also grown over five times in the last decade.

FY19/20 (financial year ended March 31, 2020) marked the first year of Mapletree's third five-year plan. Despite challenges posed by the pandemic in 2020, Mapletree's revenue for FY19/20 rose to S$3,877 million, with profit after tax and minority interests registering a total of S$1,778.5 million and return on equity at 11.2 per cent.

In its private funds, Mapletree has made acquisitions and divestments over its last financial year as part of capital management and recycling activities, and will continue to seek out properties for fund syndication such as commercial properties in China, India and Europe, and in student accommodation.

In the listed space, its four S-Reits are Mapletree Logistics Trust (MLT listed in 2005), Mapletree Industrial Trust (MIT listed in 2010) , Mapletree Commercial Trust (MCT listed in 2011), and Mapletree North Asia Commercial Trust (MNACT listed in 2013). MLT, MCT and MIT joined the Straits Times Index in 2019 and 2020, and all four S-Reits are constituents of the iEdge S-Reit Leaders Index and the FTSE EPRA Nareit Global Real Estate Index Series.

Mapletree's four listed S-Reits have a combined market capitalisation exceeding S$25 billion and distribution yield ranging from 3.9 to 5.7 per cent. The four S-Reits each have different mandates in industry sub-segments and geography, ranging from logistics, industrial and data centres to commercial and retail across Singapore, Asia, the US and Australia.

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MLT reported full year FY20/21 results with distribution per unit (DPU) increasing 2.3 per cent year-on-year to 8.326 cents and higher gross revenue and net property income of 14.3 per cent and 13.8 per cent year-on-year respectively. MLT's AUM increased by S$1.9 billion to S$10.8 billion at March 3, 2021, from acquisitions in China, Vietnam, Australia, Japan, South Korea and India. Its overall portfolio occupancy has improved to 97.5 per cent in Q4 FY20/21 with average rental reversion of 2.4 per cent and a weighted average lease expiry of 3.6 years. The Reit expects overall leasing demand in its markets to remain resilient and notes that the leasing market in Singapore has stabilised with tapering new supply while demand has benefitted from e-commerce growth.

MNACT released full year FY20/21 results with gross revenue and net property income increasing 10.4 per cent and 5.2 per cent year-on-year respectively. FY20/21 DPU of 6.175 cents was 13.3 per cent lower year-on-year due to Covid-19 impact and was cushioned by acquisitions in Japan and South Korea in H2 FY20/21. MNACT's AUM of S$7.9 billion across 12 properties held a steady overall portfolio occupancy rate of 97.0 per cent. The Reit will continue to focus on active asset management and accretive acquisitions to achieve greater portfolio diversification and aims to keep an active and prudent approach on capital management.

MCT and MIT are expected to release their full year results over the coming week. SGX RESEARCH

• For more research and information on Singapore's Reit sector, visit sgx.com/research-education/sectors for the monthly S-Reits & Property Trusts Chartbook.
• Source: SGX Research S-Reits & Property Trusts Chartbook.