Singapore-listed Mapletree Logistics Trust is acquiring the remaining 38 percent of a logistics property in Sha Tin for HK$610 million ($78 million) and will now fully own the strata-titled distribution facility in the residential and industrial district of Hong Kong’s northern New Territories.
The newly acquired Shatin No. 3 comprises an 18-storey warehouse with cargo lift access. The facility located in Hong Kong’s second largest warehouse market has a total net lettable area of approximately 39,125 square metres (421,138 square feet) and occupies a 3,400 square metre (36,597 square foot) site.
“The property has been in MLT’s portfolio since 2006 with a consistent track record of strong operating performance. We believe that there is potential for the whole building to be repositioned through asset enhancements to attract higher value tenants,” said Ng Kiat, Chief Executive Officer of the trust’s manager in a press release.
Singapore Investor Doubles Down on HK Logistics Market
The acquisition follows the company’s previous acquisition of Mapletree Logistics Hub Tsing Yi, and will further expand the Singaporean firm’s presence in Hong Kong, Ng added. Mapletree purchased the 11-storey warehouse in Tsing Yi in August last year for HK$4.8 billion ($617.6 million).
The investment by the Temasek Holdings-backed developer comes as Hong Kong’s warehouses continue to catch the eye of foreign investors. Just last month, the Canada Pension Plan Investment Board (CPPIB) committed HK$1.94 billion ($248 million) to a Hong Kong logistics fund managed by Australia’s Goodman.
These investors are being drawn by a logistics market that saw the value of investment deals in the city reach a record high in the third quarter of 2017, up by 13 percent quarter on quarter to HK$6.1 billion, according to a report by Colliers International. Logistics rents rose one percent in the period in the same period, with the international property consultancy anticipating further rent increases of from 3 to 5 percent in 2018.
Mapletree Spreads Global Roots
Mapletree Logistics Trust is sponsored by Singapore’s private equity firm Mapletree Investments. The US branch of the real estate investment and development conglomerate just purchased a 29-storey office tower in downtown Minneapolis for $258.5 million in late December, which was one of the largest-ever acquisitions of a downtown property in the city. As of March 2017, Mapletree owns and manages S$39.5 billion ($28.3 billion) of properties across a wide range of asset classes worldwide.