Mapletree Industrial Trust posts fiscal 3Q net property income rose 24 percent

Mapletree Industrial Trust property at 18 Tai Seng in SingaporeMapletree Industrial Trust property at 18 Tai Seng in Singapore

Mapletree Industrial Trust reported Tuesday its fiscal third quarter net property income climbed 24.1 percent on-year to S$122.74 million, bolstered by the acquisition of 29 data centers in North America

Gross revenue for the three months ended 31 December increased 31.3 percent on-year to S$162.35 million, the trust said in a filing to SGX. 

The distribution per unit (DPU) came in at 3.49 Singapore cents, up 6.4 percent from 3.28 Singapore cents in the year-ago period, the filing said. 

“Our portfolio rebalancing efforts towards higher value segments have enabled us to deliver another quarter of robust results. While the global economic recovery remains uneven, we will continue to strengthen the portfolio through strategic acquisitions and developments,” Tham Kuo Wei, CEO of the manager, said in the statement. 

The portfolio’s average occupancy for the quarter slipped to 93.6 percent from 93.7 percent in the previous quarter due to the completion of the 29 data centers in the U.S., which had a lower average occupancy rate of 87.4 percent, the trust said. 

Mapletree Industrial Trust said it would resume its distribution reinvestment plan to enable unitholders to acquire new units without transaction-related costs and to help finance the redevelopment of the Kolam Ayer 2 Cluster. 

The Kolam Ayer 2 Cluster will be redeveloped into new hi-tech buildings, including a seven-storey BTS facility for an anchor tenant, from the current two flatted factories with an amenity center, the filing said.

Outlook

The trust issued a cautious outlook. 

“The global recovery is expected to decelerate amid continued Covid-19 flare-ups, diminished policy support and lingering supply bottlenecks,” Mapletree Industrial Trust said. “The outlook continues to be clouded by various downside risks such as renewed Covid-19 outbreaks due to Omicron or new virus variants, the possibility of de-anchored inflation expectations, and the weakening of long-term growth drivers.”

The trust noted that average asking rental rates for data centers in North America have continued to decline amid increased competition as new data centers come online. 

“However, space and power limitations could constrain new development, which may cause an increase in colocation asking rates and lead more developers to explore vertical construction of data centres,” the trust said. 

“In addition, supply chain disruptions from the pandemic could inhibit data center development and delay the delivery of new supply, potentially raising rents in affected markets by approximately 4 percent to 6 percent,” the trust said.

The trust’s portfolio holds 143 properties across the data center, flatted factory, hi-tech, stack-up/ramp-up, business park and light industrial sectors.

Read more about Mapletree Industrial Trust’s fiscal third quarter results.