Broker: CGS International
Date of Report: July 29, 2025
Mapletree Industrial Trust: Solid Rental Reversions Offset by Occupancy Dip – In-Depth Analysis & Peer Comparison
Executive Summary
Mapletree Industrial Trust (MINT) has delivered a resilient performance in its latest financial quarter, with strong rental reversions balancing out slight occupancy declines. Despite headwinds from asset divestments and interest rate pressures, MINT’s robust fundamentals, attractive dividend yield, and proactive portfolio management continue to stand out in Singapore’s REIT landscape. This comprehensive review covers MINT’s latest results, key financials, ESG initiatives, and a detailed comparison with its Singapore REIT peers across all major sectors.
Mapletree Industrial Trust: 1QFY3/26 Results at a Glance
- 1QFY3/26 DPU: 3.27 Singapore cents, in line at 24.8% of FY26F forecast.
- Revenue/NPI: Up 0.3% and 0.8% year-on-year respectively, supported by Osaka data centre and positive lease renewals; partially offset by weaker US data centre contributions.
- DPU Decline: Down 4.7% year-on-year, mainly due to lower joint venture contributions and the absence of divestment gain distributions. Excluding these, DPU dipped just 1.5%.
Portfolio Performance & Leasing Dynamics
- Rental Reversions: Weighted average rental reversion of +8.2% across Singapore segments, with uplifts ranging from +5.0% to a striking +95%.
- Occupancy: Overall portfolio occupancy dipped 0.2 percentage points quarter-on-quarter to 91.4%. US portfolio occupancy was at 88%, while Singapore’s stood at 92.6%, slightly lower due to the data centre and general industrial segments.
- Lease Expiries: 10.1% of leases expire in FY26F; 3.4% points from US data centres, with half under active negotiations.
- Mapletree Hi-Tech @ Kallang Way: Committed occupancy improved to 63.7% at quarter-end.
Capital Management & Strategic Moves
- Gearing: Stable at 40.1%, set to dip to 37% post-divestment of 3 Singapore properties (S\$535.5m) by 3Q25.
- Funding Costs: All-in cost at 3.1% for the quarter. S\$597m of interest rate hedges expiring in FY26F may keep funding costs elevated. Management guides for 3.0–3.1% for FY26F.
- Strategy: Focus on tenant retention, lease extensions (notably at 8011 Villa Park Drive, Richmond), and selective US data centre asset divestments.
Outlook, Target Price, and Valuation
- Dividend Projections: FY26–28F DPU estimates trimmed by 1.61–2.78% to reflect income vacuum from asset sales, partly offset by interest savings.
- Target Price: Revised to S\$2.49 (from S\$2.56).
- Dividend Yield: Attractive yield of 6.3% forecasted for FY26F.
- Rating: Add maintained, supported by resilient portfolio metrics.
- Upside Catalysts: Outperforming rental reversions.
- Risks: Data centre non-renewals, global economic slowdown affecting rental and occupancy recovery.
Key Financial Summary
|
Mar-24A |
Mar-25A |
Mar-26F |
Mar-27F |
Mar-28F |
| Gross Property Revenue (S\$m) |
697.3 |
711.8 |
705.3 |
691.4 |
701.8 |
| Net Property Income (S\$m) |
521.0 |
531.5 |
528.9 |
520.2 |
528.0 |
| Net Profit (S\$m) |
120.5 |
345.2 |
374.7 |
375.6 |
383.0 |
| Distributable Profit (S\$m) |
378.3 |
386.0 |
369.7 |
370.2 |
377.3 |
| DPS (S\$) |
0.13 |
0.14 |
0.13 |
0.13 |
0.13 |
| Dividend Yield (%) |
6.49 |
6.56 |
6.26 |
6.27 |
6.38 |
| Asset Leverage (%) |
35.5 |
37.1 |
33.6 |
33.8 |
33.9 |
| P/BV (x) |
1.18 |
1.21 |
1.21 |
1.20 |
1.20 |
Peer Comparison: Singapore REIT Sector Breakdown
Industrial REITs
| Company |
Ticker |
Price (LC) |
Target Price (LC) |
Market Cap (US\$m) |
Asset Leverage (%) |
P/BV (x) |
Dividend Yield FY25F (%) |
Dividend Yield FY26F (%) |
Dividend Yield FY27F (%) |
| AIMS AMP AAREIT |
AAREIT SP |
1.39 |
NA |
825 |
33.7 |
1.26 |
7.4 |
7.4 |
7.5 |
| CapitaLand Ascendas REIT |
CLAR SP |
2.81 |
3.10 |
10,082 |
38.9 |
2.20 |
5.5 |
5.6 |
5.8 |
| ESR-REIT |
EREIT SP |
2.64 |
3.55 |
1,649 |
42.6 |
2.66 |
8.2 |
8.6 |
8.7 |
| Frasers Logistics & Commercial Trust |
FLT SP |
0.89 |
1.11 |
2,599 |
36.1 |
1.08 |
6.5 |
6.1 |
6.2 |
| Keppel DC REIT |
KDCREIT SP |
2.37 |
2.48 |
4,165 |
30.0 |
1.58 |
4.2 |
4.3 |
4.5 |
| Mapletree Industrial Trust |
MINT SP |
2.07 |
2.49 |
4,598 |
40.1 |
1.69 |
6.6 |
6.3 |
6.3 |
| Mapletree Logistics Trust |
MLT SP |
1.20 |
1.63 |
4,743 |
41.2 |
1.26 |
6.7 |
6.2 |
6.2 |
| Stoneweg Europe Stapled Trust |
SERT SP |
1.59 |
1.93 |
1,040 |
42.9 |
1.98 |
8.3 |
8.5 |
8.9 |
Key Observations: Industrial Sector
- MINT’s dividend yield and asset leverage are in line with sector averages, but its P/BV ratio remains competitive.
- Peers such as ESR-REIT and Stoneweg Europe offer higher yields, but with greater leverage.
- CapitaLand Ascendas REIT maintains a lower yield but enjoys the sector’s largest market cap and stable leverage.
Other REIT Sectors: Peer Analysis Snapshot
Hospitality
- CapitaLand Ascott Trust (CLAS SP): Market cap US\$2,692m, yield 7.0% (FY26F).
- CDL Hospitality Trust (CDREIT SP): Market cap US\$843m, yield 7.1% (FY26F).
- Far East Hospitality Trust (FEHT SP): Market cap US\$968m, yield 6.3% (FY26F).
- Frasers Hospitality Trust (FHT SP): Market cap US\$1,048m, yield 5.0% (FY26F).
Office
- Keppel REIT (KREIT SP): Market cap US\$2,841m, yield 6.1% (FY26F).
- OUE REIT (OUEREIT SP): Market cap US\$1,308m, yield 7.2% (FY26F).
- Suntec REIT (SUN SP): Market cap US\$2,723m, yield 5.6% (FY26F).
Retail
- CapitaLand Integrated Commercial Trust (CICT SP): Market cap US\$12,595m, yield 5.3% (FY26F).
- Frasers Centrepoint Trust (FCT SP): Market cap US\$3,475m, yield 5.7% (FY26F).
- Lendlease Global Commercial REIT (LREIT SP): Market cap US\$1,048m, yield 7.2% (FY26F).
- Mapletree Pan Asia Commercial Trust (MPACT SP): Market cap US\$5,296m, yield 6.4% (FY26F).
- Starhill Global REIT (SGREIT SP): Market cap US\$975m, yield 6.7% (FY26F).
Overseas-Centric and Healthcare
- CapitaLand China Trust (CLCT SP): Market cap US\$927m, yield 7.9% (FY26F).
- Elite UK REIT (ELITE SP): Market cap US\$288m, yield 8.5% (FY26F).
- Sasseur REIT (SASSR SP): Market cap US\$675m, yield 9.2% (FY26F).
- Parkway Life REIT (PREIT SP): Market cap US\$2,058m, yield 4.2% (FY26F).
Environmental, Social, and Governance (ESG) Initiatives
- LSEG ESG Score: Overall “B” rating; Environmental (B-), Social (B), Governance (B+).
- Achievements: A+ for ESG controversies; ‘A’ for GRESB Public Disclosure; ‘BBB’ by MSCI ESG; ‘Low Risk’ by Sustainalytics.
- Targets by FY30: Lower building electricity intensity by 15%, reduce GHG emission intensity by 17%, grow solar capacity to 10,000 kWp (from FY20 base).
- FY3/24 Milestones: 0.75% reduction in building electricity intensity, 26.1% drop in Scope 2 GHG emissions for Singapore properties, 98.3% of employees trained in ESG topics.
- Certifications: 31% of portfolio AUM and 24% of NLA hold sustainable building certifications. Key assets recertified for BCA Green Mark Gold and Water Efficiency.
Notably, community and environmental innovation scores (D+) leave room for improvement, but MINT’s ESG momentum is expected to attract more ESG-focused investor interest.
Balance Sheet Highlights
|
Mar-24A |
Mar-25A |
Mar-26F |
Mar-27F |
Mar-28F |
| Total Investments (S\$m) |
8,388 |
8,604 |
8,150 |
8,180 |
8,211 |
| Total Cash & Equivalents (S\$m) |
120 |
108 |
93 |
102 |
113 |
| Shareholders’ Equity (S\$m) |
4,985 |
4,888 |
4,898 |
4,909 |
4,920 |
| Current Ratio |
0.73 |
0.19 |
0.18 |
0.19 |
0.20 |
| Return on Average Assets (%) |
1.40 |
3.95 |
4.37 |
4.50 |
4.56 |
Shareholder Structure & Market Data
- Major Shareholders: Temasek Holdings (27.1%), Schroders (5.3%), Vanguard (2.3%)
- Market Cap: S\$5,903m (US\$4,598m)
- Free Float: 72.7%
- Consensus Ratings: 9 Buys, 5 Holds, 1 Sell
- Current Price: S\$2.07 | Target Price: S\$2.49 (20.4% upside)
Conclusion: Outlook and Investment Thesis
Mapletree Industrial Trust remains a cornerstone in Singapore’s REIT landscape, offering investors a compelling mix of yield, resilience, and ESG advancement. Proactive asset management, strong rental reversions, and prudent capital strategies underpin its value proposition—despite near-term income gaps from divestments and ongoing funding cost pressures.
With an attractive forward dividend yield, a solid ESG framework, and robust sector positioning, MINT is well-placed to weather market uncertainties and capture upside from potential rental reversion outperformance. The REIT stands as a preferred pick for yield-seeking investors and those prioritizing sustainability in their portfolios.
Disclosure
CGS International holds a proprietary position in Mapletree Industrial Trust. The report was prepared by analysts LOCK Mun Yee and LI Jialin.
