Singapore-Listed Mapletree Logistics Trust Selling Japan Warehouse For $69M 

Mapletree Logistics Trust (MLT) is divesting a warehouse in Japan’s Ibaraki prefecture for JPY 10.03 billion ($69 million) as the Singapore-listed REIT continues to let go of non-core properties following its S$914 million acquisition of a regional logistics portfolio from CBRE Investment Management earlier this year.

MLT entered into a sale and purchase agreement with an undisclosed third party buyer to offload its Moriya Centre warehouse complex in Ibaraki prefecture, just over one hour’s drive northeast of Tokyo, according to an announcement from its manager on Friday. The compound provides 41,713 square metres (449,000 square feet) in combined net lettable area of warehouse space across three blocks of four-storey buildings.

“The proposed divestment is in line with the manager’s continued efforts to rejuvenate its portfolio through selective divestments of non-core assets, providing MLT with greater financial flexibility to pursue investment opportunities that enhance the quality and resilience of its portfolio,” the manager said in a statement.

The latest disposal brings MLT’s total divestments this year to six assets in Singapore, Malaysia and Japan worth $60.8 million, giving the trust an opportunity to free up some cash after its gearing ratio rose to 39.5 percent at the end of June, from 36.8 percent as of 31 March, following completion of its purchase of the regional portfolio from CBRE IM.

Greater Tokyo Exit

Should the deal goes through at the agreed price, the Temasek-backed REIT would be exiting Moriya Centre at a 12.2 percent premium from its latest valuation of JPY 8.94 billion on 31 March.

The consideration is also 65 percent more than MLT’s investment in the property to date of around JPY 6.05 billion, including the JPY 4.64 billion it paid to buy the asset 15 years ago and an additional JPY 1.4 billion spent on renovations in 2015.

Located in Moriya city’s Midori district, the property is roughly five kilometres (3.1 miles) from the Yawara Interchange on Joban Expressway, providing it with access to Saitama, Tokyo, Chiba and Ibaraki prefectures.

MLT’s manager said the sale, which is expected to close before the end of December, should not have a material impact on the REIT’s asset value and net property income for the financial year ending 31 March 2024.

Post-sale, the REIT will be left with a portfolio of 188 properties across nine markets in Asia Pacific, down from its S$13.5 billion set of 193 assets as of 30 June.

Out With the Old

Before the Japan disposal, MLT this year divested three assets in Malaysia and two properties in its home city, including its announcement last month of an agreement to sell 8 Loyang Crescent in Singapore for S$27.8 million.

Also in August, the REIT agreed to sell its Century in Malaysia industrial complex in Port Klang, west of Kuala Lumpur, for MYR 60 million (now $13 million).

In July MLT closed on a sale of a pair of warehouses in Petaling Jaya, Malaysia, between Port Klang and Kuala Lumpur, to Sigma Warehousing Sdn Bhd for a combined MYR 50.2 million.

In March, the trust completed the sale of a 11,315 square metre warehouse at 3 Changi South Lane in eastern Singapore to a local furniture retailer for S$22 million.

In announcing its deal to buy CBRE IM’s logistics assets in Japan, South Korea and Australia in March, MLT said that it was also mulling a S$100 million divestment in Hong Kong, although the trust has yet to report a disposal in that location.

The REIT saw its distributable income inch up by 3.1 percent year on year to S$108.6 million in the second quarter, thanks in part to higher divestment gains.

“Given the economic uncertainty, our focus is to maintain portfolio stability, while continuing our efforts to rejuvenate the portfolio towards high-spec, modern assets,” Ng Kiat, chief executive officer of the trust’s manager, said during MLT’s earnings report in July.