Mapletree Logistics Trust

[weijian]

Wow it’s been almost 4 years and I’ve to reread the acquisition presentation 😅

I think I was looking mainly on 1) in a bag of oranges there’s bound to be lemons in the package. And in this case the Nantong Nanchang Jinan seems like lemons with 80% occupancy even after operating 3-4 years. If it’s a sale and leaseback structure (cause we are unsure of the original owner) the WALES is also too short for comfort

2) This was a Covid year and their discount to valuation was quite small which will be detrimental when interest rate normalises. Share price was about $2 when REITs was doing well and now it’s back to $1.25 similar to pre 2019

Agree there are much bigger lemons out there which VBs including myself have commented.

As usual all these will come back to haunt when interest rate start normalising and cost of capital goes up. Then we will know who has been swimming naked. Until then enjoy the view... Then again even at this environment there are those holding big lemons that have drowned

All said SG GLCs does tend to suit up and have a supplier for bathing suits on standby if 2009 was any indication:
https://www.valuebuddies.com/thread-1928...#pid132185
That doesn't mean capital loss is not a reality

I am glad I was been cryptic so as not to over-embarrass myself.

I tend to think that it is actually easier for a "99% occupancy to drop to 80%" than for an "80% occupancy to increase to 90%". Both 99% and 80% occupancy are baked in the fair valuation. The former has a bigger downside risk while the latter has some upside.

Of course, current occupancy speaks nothing of the asset quality itself. So end of the day, we are really dependent on the Sponsor. When one buys Mapletree XXX Trust, one needs 99% faith in Mapletree Investments.