• Manulife US REIT’s 2Q18 DPU of 1.30 UScts (-10% y-o-y) in line with expectations. 
• Drag from extra units from recent rights issue but only nine days' contribution from acquisition of Penn and Phipps. 
• Stronger contribution ahead once full benefits of acquisitions flow through. 

REIT That Delivers

We maintain our BUY call on Manulife US Real Estate Inv (Manulife US REIT) with a Target Price of US$0.97.

Hallmarks of a successful real estate investment trust (REIT) include management that delivers on their promises and owning properties with strong fundamentals. Since its listing nearly two years ago, Manulife US REIT has delivered with distribution per unit (DPU) exceeding IPO forecasts, property values increasing by over 10%, and the ability to identify DPU-accretive acquisitions.

With the recent US tax cuts expected to spur economic activity and demand for office space, we believe Manulife US REIT remains an attractive investment, with its original investment thesis of rising rentals and improving capital values remaining intact.

Source: DBS Research - 07 Aug 2018