Questions posed to the managers of Mapletree North Asia Commercial Trust (MNACT) and Mapletree Commercial Trust (MCT) by David Gerald, president and CEO, the Securities Investors Association Singapore (SIAS) underscore the diversification of properties dictum for S-REITs, highlighting the challenge MNACT has in growing its portfolio.
On the portfolio front, SIAS points out that Festival Walk and Gateway Plaza, account for more than 70% of MNACT’s portfolio, and they continued to report lower average rental rate. “Rental reversion for Festival Walk accelerated from negative 21% to negative 30%. For Gateway Plaza in Beijing, the rental reversion was from negative 7% to negative 24%. A major tenant at Gateway Plaza is due for renewal in December 2023,” SIAS indicates.
“Is the proposed Merger a way to leverage the resilient MCT’s portfolio at a time when Festival Walk and Gateway Plaza are underperforming? What are the plans and asset enhancement potential for these two assets? Regardless of the outcome of the proposed Merger, are these two assets considered core to the REIT?” SIAS asks.