Mapletree Logistics Trust to acquire South Korea logistics property

Singapore two-dollar bills

Mapletree Logistics Trust plans to acquire a logistics property in South Korea, Wonjin Logistics Centre, from Wonjin Logistics for 37.85 billion South Korean won, or around S$46.4 million, the trust manager said in a filing to SGX on Thursday.

The property, located in Gyeonggi-do, a province surrounding Seoul, has two blocks of multi-tenanted dry warehouses with a total gross floor area of around 29,325 square meters, the filing said.

“Gyeonggi-do is popular with third-party logistics service providers (3PLs) and distributors due to its proximity to Seoul and easy accessibility. The property is within a one-hour drive from Seoul and is well-connected to the other parts of South Korea via major highways,” Mapletree Logistics Trust Management, the trust’s manager, said in the filing.

After the acquisition is completed, MLT will have 11 properties in Gyeonggi-do and a total of 12 properties in South Korea, it said.

South Korea is the fourth largest 3PL market in Asia Pacific, with rising e-commerce growth and a growing third-party logistics market driving demand for modern warehouse space near Seoul, it said.

The property is fully leased to three established 3PLs, it said. Wonjin Logistics will lease back more than 60 percent of the property’s gross floor area, it said.

The acquisition, which will be funded by debt, will have an initial net property income yield of around 6.5 percent and is expected to be accretive to the trust’s distribution, it said. The deal is expected to be completed by the fiscal fourth quarter, it said.

The property was valued at 40.90 billion South Korean won by CBRE Korea as of 30 October, it said.

Mapletree Logistics Trust had a portfolio of 138 logistics assets across Singapore, Hong Kong, Japan, China, South Korea, Australia, Malaysia and Vietnam, as of 18 October, it said.