Manulife US REIT - RHB Invest 2023-05-29: On The Road To Redemption; BUY

Manulife US REIT - On The Road To Redemption; BUY

Manulife US REIT (SGX:BTOU) | SGinvestors.ioManulife US REIT (SGX:BTOU)
  • Keep BUY rating on Manulife US REIT (SGX:BTOU) with US$0.40 target price, 126% upside and 23% yield.
  • We think the Phipps Tower disposal to Manulife US REIT’s sponsor is another positive step, demonstrating much-awaited sponsor commitment and brightening its longer-term prospects amid a very challenging near-term US office outlook.
  • - Read this at -

Disposal of Phipps Tower

  • Phipps Tower in Atlanta (Built in 2010) is the second sale in two months to Manulife US REIT’s sponsor (purchased from the sponsor in 2018 for US$205m).
  • - Read this at -
  • Note: Child apparel retailer William Carter – the largest tenant in Phipps and Manulife US REIT’s portfolio (~5.7% of FY22 income) – downsized its space by 25% in 1Q23 but signed a longer lease (till 2035) on the 209k sq ft balance at higher rent rates (+18%). While this is one of the better asset in Manulife US REIT’s portfolio, we think the sale will likely result in weaker overall metrics.
  • The downside of potential sales of weaker assets like Figueroa in the current market is that valuations are extremely stressed and may not fully reflect the longer-term potential once the market bottoms and recovers.

Gearing to fall to ~43%, rights issue still possible.

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Vijay Natarajan RHB Securities Research | 2023-05-29

Read also RHB's most recent report:
2024-03-27 Manulife US REIT - Renewed Push To Restore Normalcy; TRADING BUY.

Previous report by RHB:
2024-02-09 Manulife US REIT - A Long Road Ahead; Now TRADING BUY.

Price targets by other brokers at Manulife US REIT Target Prices.

Listing of research reports at Manulife US REIT Analyst Reports.

Relevant links:
Manulife US REIT Share Price History,
Manulife US REIT Announcements,
Manulife US REIT Dividends & Corporate Actions,
Manulife US REIT News Articles


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