Mapletree Logistics Trust Announces New SGD Subordinated Perpetual NC5 Notes at an IPG of 3.75%

Mapletree Logistics Trust (MLT) intends to issue new SGD Subordinated Perpetual NC5 notes at an initial price guidance (IPG) of 3.75%. The perpetual securities are expected to settle on 12 August 2026, with a first call date on 12 August 2031. If uncalled, the securities will reset at the prevailing 5-year SORA-OIS plus the intial spread. Expected issue rating is -/BBB-/- (S&P/Fitch/Moody's), 2 notches below MLT's issuer rating of -/BBB+(Stable)?- respectively. Net proceeds are earmarked for general corporate and working capital purposes, including refinancing MLT's exisiting subordinated perpetual securities.

MLT is a Singapore-listed real estate investment trust with a portfolio of approximately 175 properties across nine Asia-Pacific markets - Singapore, Australia, China, Hong Kong, India, Japan, Malaysia, South Korea, and Vietnam. As at 30 June 2026, the total value of assets under management stood at S$13.1 billion. The sponsor for the REIT is Mapletree Investments ("Mapletree"), a Singapore-based real estate development, investment, capital, and property management company, indirectly wholly owned by Temasek Holdings via Fullerton Management Pte Ltd.

For the first quarter of FY2026/27 (1Q FY2026/27) ended 30 June 2026, MLT reported a slight increase of 0.8% YoY in gross revenue to S$178.9 million, as revenue generated from acquisitions and existing properties was offset by divested properties and the depreciation of various regional currencies against the Singapore dollar. Net property income (NPI) grew 2.0% YoY to S$156.4 million, aided by a 6.3% YoY decline in property expenses to S$22.5 million.

MLT maintained a healthy portfolio occupancy of 96.4% as at 30 June 2026 (4QFY2025/26: 96.9%), with a diversified customer base of 989 tenants, mainly serving consumer-related trade sectors. Rental reversions came in at +0.9% overall (or +2.3% excluding China), with China's reversion continuing to narrow to -1.8%, from -7.5% a year ago.

The Group's total cash and cash equivalents rose 7.7% QoQ to S$325.7 million, while total borrowings rose 0.5% QoQ to S$5,514.8 million. Of this, S$5,077.3 million is unsecured (S$154.6 million repayable within one year, S$4,922.7 million after one year), while the remaining S$437.5 million is secured against investment properties in Japan and Malaysia. Currently, the Group is in a net current liabilities position of S$43.7 million, mainly due to a portion of long-term borrowings maturing within the next 12 months. MLT nevertheless retains adequate liquidity headroom, supported by S$653 million of available committed credit facilities.

Separately, borrowing costs decreased 2.7% YoY to S$38.3 million, as savings from lower base rates on unhedged SGD borrowings and interest savings from repaying loans with divestment proceeds more than offset the incremental borrowings drawn during the quarter. On a QoQ basis, however, borrowing costs rose S$0.7 million, or 2.0%, mainly due to higher interest incurred to fund the acquisition in India, capital expenditure, and the land premium on the extension of a land lease.

Aggregate leverage edged down slightly from 40.6% to 40.5% QoQ, remaining comfortably within MAS's 50% regulatory ceiling for S-REITs. The interest coverage ratio (ICR) was maintained at 2.9x (estimated to go to 2.7x under a 10% EBITDA decline scenario), reflecting a reasonable headroom over debt service obligations even under stress scenarios.

We feel that Mapletree Logistics Trust is a fundamentally sound issuer, backed by a well-diversified, income-producing logistics portfolio and the sponsorship of Mapletree Investments, a Temasek-linked platform with a track record of capital recycling support that underpins MLT's access to alternative funding and liquidity.

At the 3.75% IPG, MLT's new perpetual offers a 55 bps yield pickup over its own existing MLTSP 4.300% perpetual, which yield 3.20% - and an identical 55 bps pickup over Mapletree Industrial Trust's MINTSP 3.250% perpetual, also rated BBB-, at 3.20%. This suggests the new issue is priced with a meaningful concession even relative to same sponsor.

Against CapitaLand Ascendas REIT's unrated AREIT 3.180% which yields 3.06%, the IPG offers a wider 69 bps pickup, while against ESR-REIT's unrated EREIT 5.750% which yields 4.44%, the new issue is priced 69 bps tighter. The gap with ESR-REIT likely reflects ESR-REIT's weaker perceived credit profile and smaller scale relative to MLT, while the pickup over CapitaLand Ascendas REIT may reflect a combination of tenor (CapitaLand Ascendas REIT resets sooner, in ~4.03 years versus MLT's 5.00 years) and sector/portfolio differences.

Overall, we view Mapletree Logistics Trust’s new SGD Subordinated Perpetual NC5 Notes at an IPG of 3.75% as fairly priced.

Table 1: Peer Comparison

Issuer	Issue	Credit Rating (S&P / Fitch / Moody’s)	Ask Price	Years to Reset	Yield to Worst (%)
Mapletree Logistics Trust	MLTSP 3.250% Perpetual Corp (SGD)	- / BBB- / -*	100.00	5.00	3.75**
CapitaLand Ascendas REIT	AREIT 3.180% Perpetual Corp (SGD)	- / - / -	100.45	4.03	3.06
ESR-REIT	EREIT 5.750% Perpetual Corp (SGD)	- / - / -	104.35	3.63	4.44
Mapletree Industrial Trust Treasury Co Pte Ltd	MINTSP 3.250% Perpetual Corp (SGD)	- / BBB- / -	100.22	4.58	3.20
Mapletree Logistics Trust	MLTSP 4.300% Perpetual Corp (SGD)	- / BBB- / -	103.18	3.05	3.20
Data as of 4 August 2026 Expected credit rating *Yield is based on IPG

Disclosure: For specific disclosure, at the time of publication of this report, IFPL (via its connected and associated entities) holds a position in MLTSP 3.250% Perpetual Corp (SGD). The analyst who produced this report holds a NIL position in the abovementioned securities. This research report was prepared with the assistance of artificial intelligence (AI) tools. iFAST Financial Pte Ltd does not rely exclusively on AI for content generation; the content of this report – including all investment theses, ratings, price targets and conclusions – has been independently reviewed and verified by the research analyst(s) to ensure accuracy and professional integrity.

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