Gross revenue and net property income (NPI) increased slightly by 0.3% and 0.8% y-o-y to S$175.9m and S$133.6m, respectively. This was driven by higher contribution from the completion of Phase 3 and final phase of fitting-out works at its Osaka Data Centre, coupled with a recent acquisition in Tokyo, but partially offset by the weaker US$ relative to S$.
1QFY26 DPU fell 4.7% y-o-y and met our expectations.
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Excluding the divestment gains and one-off compensation, Mapletree Industrial Trust’s core DPU would instead have declined by a smaller magnitude of 1.5% y-o-y. This accounted for 24.9% of our initial FY26 forecast.
Continued positive rental reversions in Singapore (+8.2%) but occupancy declined marginally by 0.2 ppt q-o-q to 91.4%.
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For its Singapore operations, Mapletree Industrial Trust achieved another quarter of steadfast rental reversions for its renewal leases. This came in at +5.0% for its Hi-Tech Buildings and Business Space segment and +9.5% for its General Industrial Buildings segment, thus culminating in an overall portfolio weighted average rental reversion rate of +8.2%. This is tracking above management’s earlier guidance for a mid-single digit rental reversion rate in FY26, but we expect the figure to moderate ahead.
Despite our concerns over Mapletree Industrial Trust’s portfolio occupancy risks, this held up relatively well during the quarter (-0.2 ppt q-o-q to 91.4%). Occupancy declined slightly by 0.3 ppt and 0.2 ppt q-o-q to 92.6% and 88.0% in Singapore and the US, respectively, and was 100% in Japan.
Aggregate leverage ratio unchanged q-o-q at 40.1% but set to decline to ~37% upon completion of proposed divestments.
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Above is an excerpt from a report by OCBC Investment Research. Clients of OCBC Securities may be the first to access the full PDF report @ https://www.iocbc.com/.
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