Mapletree Logistics Trust Buying APAC Portfolio From CBRE IM for $687M

SGX-listed Mapletree Logistics Trust has agreed to buy a portfolio of properties in Japan, South Korea and Australia from affiliates of CBRE Investment Management for S$913.6 million ($687 million).

The freehold properties consist of four logistics assets in Greater Tokyo and one each in Nagoya, Hiroshima, Seoul and Sydney, MLT’s manager said Thursday in a filing with the Singapore Exchange. The REIT sponsored by Temasek-owned Mapletree Investments will finance the acquisition in part through a S$200 million private placement of new units.

The soon-to-be-added sheds are aimed at accelerating the rejuvenation of MLT towards a “resilient and future-ready portfolio” with a high proportion of high-quality logistics properties.

“This strategy will be accompanied by the pursuit of other strategic initiatives such as selective divestment of non-core assets to enable the recycling of proceeds into investments of modern-specifications logistics properties with higher growth potential,” the manager said.

Deepening Presence

The Greater Tokyo assets are in the cities of Kasukabe, Shiroi, Soka and Chiba within Route 16, a highway accessing densely populated areas of Central Tokyo and Greater Tokyo. The Nagoya property is in Gifu, a key manufacturing hub in Japan, and the Hiroshima property is within the Seifu-Shinto industrial and logistics cluster.

All six Japanese assets are less than four years old and comprise 204,106 square metres (2.2 million square feet) of net lettable area. Their agreed property value is JPY 66 billion ($500 million), a 3.8 percent discount to their independent valuation as a whole.

The Seoul property is within the Yongyin-Icheon logistics cluster, about an hour’s drive southeast of the capital’s city centre. Completed in 2020, the 78,175 square metre facility’s agreed value of KRW 144.8 billion ($110 million) represents a 6.1 percent discount to independent valuation.

The Sydney property, located at 8 Williamson Road in Ingleburn, features two separate facilities: one built in 1987 and spanning 35,324 square metres of NLA and another completed in 2020 and providing 11,423 square metres. The asset is near the upcoming Moorebank Intermodal Terminal and has an agreed value of A$125.7 million ($84.3 million), a 2.6 percent discount to independent valuation.

More Deals in the Offing

MLT’s gross floor area in Greater Tokyo, the Seoul metropolitan area and Sydney will increase by a respective 57 percent, 12 percent and 43 percent upon completion of the transaction, the trust’s manager said. The Japan assets are expected to generate an initial net property income yield of 3.5 percent, while the Seoul and Sydney acquisitions are seen producing an initial NPI yield of 4.6 percent.

Also Thursday, MLT said it was contemplating a potential acquisition of two logistics assets in eastern China’s Jiaxing for more than RMB 1 billion ($150 million), as well as a possible divestment in Hong Kong at a price of HK$590 million ($75.2 million).

MLT has accepted a non-binding expression of interest bid from an unrelated third party in relation to the prospective divestment in Hong Kong, where the S$12.6 billion trust has nine assets. The parties have agreed to a binding exclusive period ending on 18 May.

Earlier this month, US-based BlackRock became a substantial investor in MLT as defined by Singapore law. The world’s biggest asset manager acquired just under 1.8 million units of the trust for a total of S$3 million, raising its stake to above the 5 percent threshold to be considered a substantial unitholder.