Mapletree Logistics Trust Buying $1B Worth of Sheds in China, Vietnam and Japan

One of Asia’s busiest industrial REITs, Mapletree Logistics Trust, has agreed to spend S$1.4 billion ($1 billion) to acquire 17 warehouse assets spanning 1.2 million square metres (13 million square feet) in China, Vietnam and Japan, including a five-storey Greater Nagoya facility built by development giant Daiwa House.

Singapore-listed MLT will buy 13 properties in China held by its Temasek-controlled sponsor, Mapletree Investments, and Japanese trading firm Itochu for the equivalent of $643.4 million, as well as three Vietnam properties held by Mapletree for $95.9 million. A 97 percent stake in the single Japanese property will be acquired from an unrelated third party for $304.4 million, with a local Mapletree affiliate holding the remaining interest.

Together, the acquisitions will expand MLT’s existing 6.6 million square metre portfolio by more than 18 percent, with Ng Kiat, chief executive of the trust’s manager, pointing to the pandemic as having highlighted the importance of logistics and underscored the need for supply chain resiliency in a release late Monday.

“The acquisitions of these 17 modern Grade A logistics assets with an average age of 1.6 years position us well to capture these structural trends,” Ng said. “The acquisitions in China and Vietnam will expand MLT’s network connectivity in these large growing consumption markets while the acquisition in Japan will scale up our presence in Greater Nagoya, an attractive logistics market strategically located between Greater Tokyo and Greater Osaka.”

New Benchmark

Spanning 158,034 square metres (1.7 million square feet) of gross floor area, the freehold ramp-up facility in Greater Nagoya’s Kuwana City has a committed occupancy of 82.5 percent and will be MLT’s largest asset in Japan upon closing of the transaction.

Although the seller of Kuwana Logistics Center was not identified, the facility is a project of Osaka-based developer Daiwa House, which completed the structure in May 2019. The centre’s key tenants include Nohi Transport, Marubeni Logistics and Hitachi Transport System.

The titanic warehouse is half again as large as the portfolio’s biggest existing Japanese asset, Mapletree Kobe Logistics Centre, which measures 102,119 square metres in GFA.

The 13 mainland China properties, meanwhile, are situated in key logistics hubs close to large population catchments. The acquisitions will deepen and expand the trust’s presence in China, adding three new provinces to its geographical coverage and expanding its network to 43 assets in 29 cities, MLT said.

The new Chinese assets span a combined 863,015 square metres of net lettable area, with committed occupancy of 89.1 percent and a weighted average lease expiry of 2.7 years. The largest of these is Mapletree Wenzhou in Zhejiang province, measuring 126,571 square metres in NLA.

The Vietnam properties include two assets in the city of Bac Ninh and one in Binh Duong, serving the markets of Hanoi and Ho Chi Minh City, respectively. The fully occupied warehouses have a combined NLA of 188,500 square metres and serve tenants including European giants DHL and DKSH.

Year of Activity

After a first half of 2021 that featured portfolio acquisitions of sheds in South Korea and India, MLT has kept up the pace with a string of deals in recent months.

In July, the REIT was granted an option to buy a low-rise temperature-controlled warehouse building with ancillary offices in Singapore’s Changi area for S$24.5 million from RSH Holdings.

In August, the trust proposed the purchase of a fully leased, freehold cold storage facility in Australia for A$42.8 million (now $30.9 million), and September saw MLT announce the planned acquisition of a two-year-old logistics facility in South Korea, Yeoju Logistics Centre, for KRW 135 billion (now $110 million).