Mapletree Investments, which recently announced a record net profit of $931.7 million for its latest financial year, is looking to ramp up its overseas business and potentially list a real estate investment trust (Reit) made up of office assets in Japan in two years.

Plans for the Japan Reit are still fluid as the office portfolio is small, but Mapletree's chief executive officer Hiew Yoon Khong shared in a recent interview with The Business Times that it is currently the most likely of Mapletree's property portfolios to go into a Reit. The group, meanwhile, is gearing up for a bigger presence in China, where it has assets under management (AUM) of about $6.8 billion including its properties in Hong Kong  ‐ or about 31.5 per cent of its total AUM of $21.8 billion.

Mr Hiew said that Mapletree's growth in China will be the fastest across all the markets, largely because of the economy's sheer size. The group is currently syndicating its second China fund, likely to be in the range of US$1 billion to US$1.4 billion, which with gearing could bulk up to between $2 billion and $2.8 billion and will be deployed over two to three years.

Mapletree's first fund with exposure to China is the Mapletree India China fund, which is fully invested with a focus on commercial and mixed‐use projects in Tier One and Two cities in China, and Tier One cities in India.

In Japan, the group will grow its presence in a more measured manner, with acquisitions likely over the next 12 months, said Mr Hiew. Mapletree's office developments in Japan have a value of about $300 million, which, Mr Hiew said, is "a bit too small for a Reit". A very strong IPO (initial public offering) requires a certain scale which by his reckoning should be a minimum of about $1 billion.

Source: AmFraser