Mapletree Commercial Trust

[karlmarx]

Compared to IPO when the units were sold at below NAV, and yielding about 6%, the new units are now likely to be sold at a large premium to NAV, given MCT's current market price. This is a very good deal for Temasek.; they get to exit the property at an acceptable market value, during a period of poor sentiment.

For unitholders, there is slight accretion to NAV and DPU, which is usually the case. By and large, this acquisition may have improved the business fundamentals of MCT slightly.

But the greatest concern for MCT unitholders should not be its business fundamentals. The concern should be whether it is ideal to buy new MCT unit -- or even hold existing units -- at a large premium to NAV. Its current yields are probably at their lowest ever.

[¯|_(ツ)_/¯]

22 Apr 2020 MCT changes in unprecedented time:
https://links.sgx.com/FileOpen/MCT%20-%2...eID=607665
(click for details)

1. Div will be paid half yearly (instead of Qtr)
2. NTA up 9.4% to $1.75 as total investment properties were valued at $8.9 billion
3. High committed occupancy, from 92.7% at PSA building, 99.7% at VivoCity, to full commitment at MBC II, Mapletree Anson and MLHF.
4. $43.7m of distribution was retained in 4QFY19/20. 
5. Because of #4, significant drop of DPU to 0.91 cents (vs 2.31 cents 4QFY18/19)

Ms Sharon Lim, Chief Executive Officer of the Manager, said, 
“As the COVID-19 situation is still evolving rapidly, there remains a significant degree of uncertainty over its duration and severity, and when normalcy can resume. While we remain well-capitalised with ample financial flexibility, we must continue to exercise prudence. We have thus elected to retain S$43.7 million of distribution by way of capital allowance claims and capital distribution retention in 4Q FY19/20 to better position ourselves for the challenges ahead.”

For the record, MCT closed yesterday at $1.76.

Stay home and stay safe, everyone.