Mapletree Industrial Trust - OCBC Investment 2020-01-22: Rental Reversions Stabilising

MAPLETREE INDUSTRIAL TRUST (SGX:ME8U) | SGinvestors.io MAPLETREE INDUSTRIAL TRUST (SGX:ME8U)

Mapletree Industrial Trust - Rental Reversions Stabilising

  • Mapletree Industrial Trust's 3QFY20 DPU rose 2.9% y-o-y.
  • Only Flatted Factories saw negative rental reversions.
  • Raise Fair Value to S$2.87.



3QFY20 results in-line with our expectations



Rental reversions turned positive for all segments except for Flatted Factories

  • Operationally, Mapletree Industrial Trust’s rental reversions for renewal leases appear to have bottomed out, as positive rental uplifts were recorded for Hi-Tech Buildings (+1.4%), Business Park Buildings (+0.2%) and Stack- Up/Ramp-Up Buildings (+1.6%). Only the Flatted Factories segment registered negative rental reversions during the quarter (-1.1%), a stark contrast to the past few quarters in which most or all of Mapletree Industrial Trust’s segments had recorded negative rental reversions.
  • There was also an improvement in overall portfolio occupancy from 90.5% (end-2QFY20) to 90.9%. This was driven by a healthy pick up for Business Park Buildings (+3.2 ppt q-o-q) and Hi-Tech Buildings (+1.5 ppt q-o-q), but partially offset by a 0.6 ppt decline for Flatted Factories.
  • According to CBRE, Singapore's manufacturing sector showed some early signs of recovery in 4Q19, and there were pockets of leasing demand seen, a handful of which were for expansion.


Recalibrating assumptions






OCBC Research Team OCBC Investment Research | https://www.iocbc.com/ 2020-01-22
SGX Stock Analyst Report HOLD MAINTAIN HOLD 2.87 UP 2.550



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