Mapletree Logistics Trust shares in chaos

Can CEO Jean Kam really lead Mapletree Logistics Trust out of dark Egypt? Year-to-date, Mapletree Logistics Trust (MLT) shares have tumbled 11%. What makes this sell-off particularly painful for unitholders is that the counter continued its downward drift even after delivering a stabilized 1Q FY26/27 DPU of 1.816 cents.

Brushing off the falling Mapletree Logistics Trust shares is risky though your primary goal as an income investor is simply to collect dividends. Even for dividend investors, capital preservation matters. A 6% annual dividend yield means very little if the underlying capital value drops 12% over the same period of time.

MLT share price fighting fire

Nightmare of Mapletree Logistics Trust (MLT)

Mapletree Logistics Trust share price in confidence crisis

What is alarming for investors is that being one of the major STI components, the S-REIT’s market capitalization has been severely impacted by the falling Mapletree Logistics Trust shares. From $8.8 billion in FY21/22, the market capitalization has collapsed to a low of $5.8 billion in FY25/26.

The crisis of confidence surrounding MLT is entirely understandable. Prior to the latest quarterly financial result, the S-REIT logged an outrageous stretch of year-on-year quarterly DPU declines across FY24/25 and FY25/26. Considering MLT’s absolute peak DPU was 2.271 cents back in 1Q FY23/24, the multi-year erosion in distributions has severely tested unitholder patience and shaken faith in management.

The major flashpoint for Mapletree Logistics Trust shares came after the Manager divested two properties in China and one property in Singapore for $155 million but opted not to distribute the capital gains as special distributions. The divestments surely mean that DPU will continue to decline in next quarter unless the Manager deploys the proceeds on DPU-accretive acquisitions.

In my view, the current management fee structure is not aligned to unitholders’ interest. Rain or shine, the management would receive performance fee of 3.6% per annum of the NPI, base fee of 0.5% per annum of the value of total assets, acquisition fee of 1% of the acquired value of the asset and divestment fee of 0.5% of the disposed assets. In FY25/26, the Manager received $89 million of management fees and $90 million in FY24/25.

What is particularly annoying to me is that Mapletree Logistics Trust always settle the management fees in newly issued units. Due to this reason, any asset acquisitions would incur management fees that would cause Mapletree Logistics Trust shares to be further diluted. For the records, 19 million units were issued on 12 August 2026. The tsunami of new units has a dilutive impact on Mapletree Logistics Trust shares, causing the counter to trade below its NAV of $1.26.

Against the backdrop of falling unit price and declining DPU, should unitholders panic and bolt for the exit? Absolutely not.

This is because MLT is not in a distress situation nor facing insolvency. The S-REIT is still raking in profits from its portfolio of Asian logistics assets. Furthermore, with Temasek Holdings as its backer, there is no reason to panic. Nonetheless, “not panicking” shouldn’t mean staying entirely passive. Unitholders must closely monitor how CEO Jean Kam executes capital recycling—specifically whether divestment proceeds are swiftly converted into DPU-accretive acquisitions.

Note that this is an opinion article and not meant to be a financial advice. Please do your due diligence or engage financial advisors before investing in the stock market. I am vested in this counter, so my views on MLT share price may be biased.

Mapletree Logistics Trust in China conviction

Most unitholders would have known that MLT’s China assets are the main culprit for dragging down the S-REIT’s financial performance in recent years. Despite so, it appears to me that the Manager is adamant to be the last man standing in its stance for the Group’ significant China exposure. Even though the Manager had targeted to divest $500 million worth of assets in China and Hong Kong, only 3 China assets were sold so far – 1 in Xi’an and 2 in Wuxi. The Manager’s position is that they will only sell for the right price and that they believe the China market is close to bottoming.

The conviction of China recovery stems from an independent market research done by JLL in May 2026. In the report, it was revealed that [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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