Fairytale of Mapletree Commercial Trust
With a market capitalization of $4.53 billion, Mapletree Commercial Trust (MCT) is the largest REIT sponsored by Mapletree Investments Pte Ltd. Temasek Holdings has a majority stake of 34.71% in this REIT while other big boys like AIA Group and NTUC Enterprise own stakes amounting to 4.92% and 2.42% respectively.
With such stellar group of major shareholders, Mapletree Commercial Trust is certainly an attractive real estate investment trust. But could it be an investment trap or potential multi-bagger?
Since this REIT debut in SGX Mainboard in 2011, it has consistently outperformed STI. The total returns (including capital appreciation and distributions paid out) is 138.5%. For the longest time, I am torn between investing in Mapletree Logistics Trust or Mapletree Commercial Trust. In this article, I will attempt to make an investment analysis of Mapletree Commercial Trust.
Business Profile
Looking at the portfolio, it is not difficult to understand why this REIT is so popular among Singaporeans. MCT has five properties in Singapore namely, Vivocity, PSA Building, Mapletree Anson, Bank of America Merrill Lynch HarbourFront and Mapletree Business City I. All these assets are either premium office or properties that are strategically located in the CBD area. VivoCity is also Singapore’s largest mall located in the HarbourFront Precinct.
Broadly speaking, the growth strategy of Mapletree Commercial Trust is two-pronged – acquisitions and active asset management. The Manager pursues potential asset acquisitions that will provide attractive cash flows and yields. For example, Mapletree Anson and MBC I were [This is a premium article. The rest of the content is blocked and can be accessible by SG Wealth Builder Members only. To read the full content, please sign up as member.]
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Magically yours,
SG Wealth Builder
Hi,
As someone who is very new to investing, can I ask why would you still monitor for a few quarters before investing even though you said it is very attractive? What would you be looking out for?
Hi Boon Sheng,
Thank you for your comments. You have made a good point. Actually, there are a few other stocks that I am looking at the moment, such as SingTel, Mapletree Logistics Trust and OCBC. So I am still not decided whether to invest in Mapletree Commercial Trust yet.
Furthermore, I would like to see what is the strategy of Mapletree Commercial Trust’s management on the rest of its debts payable within this financial year. Until then, I hope to see the share price correct some more and hope for bargain buy.
Regards,
Gerald
https://www.sgwealthbuilder.com