Mapletree Industrial Trust: Has been awarded Tranche 2 of JTC’s 2nd divestment exercise. Portfolio is acquired by MIT at $400.3m and consists of eight flatted factories and three amenity centres. Bid price was 45% above the second highest bidder, A-REIT. MIT now owns 81 properties valued at $2.6b and a quired portfolio will increase the NLA by 17.5% to a total of 1.3mn sqm….
Citi estimates initial yields at just above 5% and 3-yr NPI CAGR of 12.1% for new portfolio given its passing rental is significantly below mkt, while financing structure has not been announced. Assuming 100% debt funding, accretion likely to be 3% in FY12 and 7%-8% in FY13 and bring MIT’s net debt/asset ratio to 45%. If funded with 60%-65% debt, estimate the impact to be yield neutral to 1% accretive in FY12 and 1%-3% in FY13-FY15. House maintains Buy with $1.25 TP.
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