Mapletree bets US$3b on two US logistics portfolios

MAPLETREE Investments has acquired two portfolios of logistics assets in the United States, comprising 141 income-producing assets for a total investment value of approximately US$3 billion.

The latest acquisition will give it scale and investor interest to create a fourth US-focused private fund with a fully seeded portfolio of 155 logistics assets, the company said.

The first portfolio, acquired in July 2021, comprises 24 assets totalling 6.1 million square feet (sq ft) of net lettable area (NLA) across Dallas, Memphis, Greater Chicago, Central Florida and Boston.

It has an occupancy rate of 98.9 per cent and a weighted average lease to expiry (WALE) of 3.3 years, as at end of June this year.

The second portfolio was acquired in September this year. It includes 117 assets spanning 22.3 million sq ft of NLA across Greater Chicago, the Carolinas, Memphis, Houston and Washington DC/Baltimore. The portfolio is 94.1 per cent occupied and has a WALE of 4.1 years.

Nicholas Mak, head of research & consultancy at ERA, thinks that Mapletree making the acquisitions is "a good move".

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"Many of the low-lying fruits in the local market have already been plucked. The company will have to look overseas for more opportunities to expand its portfolio, while still generating stable income at an acceptable risk level," he said.

Tom Woolhouse, head of logistics and industrial (Asia Pacific) at JLL, commended the portfolios' "attractive" tenant mix, which includes companies in third-party logistics, e-commerce, consumer goods and wholesale.

With the acquisitions, Mapletree will have a total of about S$25.5 billion worth of assets under management in the logistics sector, with an estimated NLA of 224 million sq ft across Asia-Pacific, Europe and the US.

The real estate and investment company will also hold about US$14.8 billion worth of real estate across the US.

Mr Woolhouse said: "The US leasing market is on fire with record tenant demand, rents growing and historic lows in terms of vacancy. Vacancy is likely to be sub-4 per cent in the US by year end.  Many landlords are achieving up to 20 per cent uplifts on their assets at lease events.  We’re also witnessing very strong cap rate compression."

"This shows that Mapletree is a true global force and (the acquisitions) will be of significant benefit to their reputation globally and in Singapore," he added.

Meanwhile, Michael Smith, regional chief executive officer of Europe and the USA at Mapletree, said: "The US logistics sector is among the best performing and most resilient of all the real estate markets in which Mapletree operates globally. By combining these recently acquired assets with 14 logistics facilities that we currently own, we have attained sufficient scale and investor interest to create a fourth US-focused private fund with a fully seeded portfolio of 155 logistics assets."

In August, Mapletree had separately told BT it will evaluate various options to monetise its portfolio of student accommodation assets over the next few months. These options include a public Reit or private fund, it said.

That came after it acquired four purpose-built student accommodation (PBSA) assets in the United Kingdom from Vita Group for over £165 million (about S$306 million), further expanding its student housing footprint in the UK.

Last month, it also closed its maiden US office fund, Mapletree US Income Commercial Trust (MUSIC), with US$552 million in total fund equity raised. MUSIC is Mapletree's twelfth private equity fund and the fifth in a series of fully-seeded funds encompassing Europe and Australia commercial, Europe and US logistics, as well as student accommodation in the UK and US.

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