- Mapletree Industrial Trust (SGX:ME8U) delivered a softer 4QFY25/26 performance on the back of vacancies from its datacenters in the USA and income vacuum from Singapore.
- - Read this at SGinvestors.io -
- For the year, gross revenue and NPI declined 5.5% and 5.9% y-o-y to respectively to S$ 673.0mil and S$ 500.3mil respectively. The decline in performance was cushioned by stable leasing momentum in Singapore, where positive rental reversions and high tenant retention continued to support revenues.
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Our view
Earnings drag in the term.
- We believe that Mapletree Industrial Trust remains in the midst of a transition, with near-term earnings likely to remain under pressure as North American vacancies continue to weigh, even as Singapore and Japan provide stability.
- While management’s strategy to divest weaker US assets and redeploy into higher-quality data centres is directionally positive, execution risk around timing, reinvestment yields and backfilling remains. Together with expiring interest rate hedges and FX headwinds, this suggests that Mapletree Industrial Trust's DPU recovery will likely be sometime out in the medium term, with an inflection dependent on stabilising occupancy in North America, successful capital recycling and balance sheet recapatisation.
Stable operational performance.
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