This article is from the Australian Property Journal archive
THE SGD$13.3 billion Mapletree Logistics Trust continues to target Malaysia and Vietnam which are benefitting from a structural shift and global supply chain diversification reshaped by the pandemic and ongoing impact of the US-China trade war.
MLT has acquired three facilities worth S$226.3 million. The purchases of the Malaysia property and Vietnam properties are MYR558.8 million (~S$157.9 million) and VND1,254,523 million (S$68.4 million) respectively.
The Malaysian asset representing a discount to valuation of approximately 0.2% and 1.1%, whilst the Vietnam properties represents a discount of approximately 3.2% and 2.9%.
The Malaysia property was acquired on a net yield of 5.7% and the Vietnam properties on 7.5% yield.
CEO Ng Kiat said strategically located in logistics hubs serving the growing consumption bases in Kuala Lumpur, Ho Chi Minh City and Hanoi, these acquisitions will position the portfolio to capture emerging Asia’s growth potential and deepen MLT’s network connectivity in these growth markets and position the trust to capitalise on favourable demand drivers for logistics space, such as growing consumption and greater focus on supply chain diversification.
Ng said Asia’s logistics sector has been reshaped by the ongoing impact of the US-China trade war, pandemic disruptions, and rising political pressures to deglobalize.
As a result global supply chain diversification is set to continue, with businesses shifting from their traditional focus on efficiency to security and resilience.
“In Asia, Malaysia and Vietnam have been key beneficiaries of this structural shift, in part due to their competitive labour costs, skilled workforces and supportive government policies,” she added.
Furthermore, the covid-led e-commerce boom continues with Malaysia’s e-commerce revenue forecast to expand at a healthy compound annual growth rate (“CAGR”) of 6.7% between 2022 and 2026.
And Vietnam’s e-commerce revenue is expected to see a CAGR of 22.1% over the same period due to a steady increase in internet penetration.
The Malaysia property is located in Shah Alam, one of Malaysia’s major industrial regions 22kms from the Kuala Lumpur city centre. The facility comprises two blocks of four-storey ramp-up warehouses, with a building age of 0.8 years and a net lettable area of 127,442 sqm. It is 96% leased with a weighted average lease expiry of 2.2 years as at 31 December 2023.
The Vietnam portfolio comprise a logistics asset in Binh Duong Province and in Hung Yen Province.
The Binh Duong Province facility is located close to Ho Chi Minh City, the largest city in Vietnam and comprises four blocks of single-storey warehouses with a building age of 5.5 years and an NLA of 61,712 sqm. The property is fully leased with a WALE of 1.7 years as at 31 December 2023.
The Hung Yen Logistics Park I marks MLT’s first entry into Hung Yen Province in the northern province of Vietnam, within one hour’s drive from Hanoi city centre.
The property comprises four blocks of single-storey warehouses, with a building age of 2.0 years and an NLA of 60,186 sqm and is 90% occupied with a WALE of 1.1 years as at 31 December 2023.
Ng said the acquisitions will expand MLT’s presence in Malaysia and Vietnam, increasing the trust’s exposure in the two countries from 24 assets to 27 assets. GFA in Malaysia and Vietnam will increase by 20.6% and 21.0% to 775,572 sqm and 703,941 sqm respectively.
The acquisition will be funded by a mix of debt and part of the sale proceeds from divestments with gearing expected to increase from 38.8% to 39.6% on a pro forma basis.
