Mapletree Logistics Trust (MLT) announced its proposed acquisition of the Coles Distribution Centre in Brisbane, Australia, for a purchase consideration of A$105m via the acquisition of a property trust holding the property. The seller is an unrelated third party.

This property sits on freehold land, comprises a single-story ambient warehouse facility with ancillary office space and is 100% leased to Coles Supermarkets. The remaining lease term is 4.3 years.

According the MLT, this proposed acquisition will offer an initial NPI yield of 5.7%. Post-acquisition, MLT’s aggregate leverage is expected to be ~38.5%, while Australia will form ~8.3% of its portfolio value, versus 6.9% currently.

We currently have a BUY rating and S$1.37 fair value on MLT.

Source: OCBC Research - 29 Oct 2018