Your 60-Second Guide To Mapletree Commercial Trust (SGX: N2IU) Units
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Your 60-Second Guide To Mapletree Commercial Trust (SGX: N2IU) Units

Sudhan P
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In this series, we will feature one Singapore-listed company each time as a quick guide to everything you should know about it in 60 seconds.

In this instalment, we have Mapletree Commercial Trust (SGX: N2IU). Previously, we featured Singapore’s largest bank, DBS Group Holdings Ltd (SGX: D05).

What’s Mapletree Commercial Trust’s Business About? 

Mapletree Commercial Trust is a real estate investment trust (REIT) that owns six office and retail assets in Singapore. Those properties are VivoCity, Mapletree Business City (MBC) I, Mapletree Anson, Bank of America Merrill Lynch HarbourFront, and PSA Building.

The REIT recently acquired MBC II in November 2019. 

Five of those properties are located in the Greater Southern Waterfront (HarbourFront and Alexandra Precincts) area, while one is in the Central Business District (CBD).

Mapletree Commercial Trust property spread
Source: Mapletree Commercial Trust FY18/19 annual report (before MBC II acquisition)

The REIT is sponsored by Mapletree Investments Pte Ltd, a property developer, manager and investor headquartered in Singapore.

Mapletree Commercial Trust’s Financial Highlights 

Mapletree Commercial Trust has been growing consistently over the years. 

From FY14/15 to FY18/19 (the REIT has a 31 March year-end), Mapletree Commercial Trust grew its gross revenue by 57% and net property income by 64% in all.

Gross revenue consists mainly of the rental income brought in by the REIT while net property income is the amount left after deducting property operating expenses.

Mapletree Commercial Trust financial highlights 2015 to 2019
Source: Mapletree Commercial Trust FY18/19 annual report

Distributable income has climbed steadily too.

This metric rose 57% in all, from S$168.3 million in FY14/15 to S$264.0 million in FY18/19. Distributable income is money that is available to be distributed to Mapletree Commercial Trust’s unitholders.

Mapletree Commercial Trust’s Distribution Per Unit History

With the uptick in distributable income, Mapletree Commercial Trust’s distribution per unit (DPU) has grown as well. This can be seen from the table below: 

YearDPU (cents)
FY14/158.00
FY15/168.13
FY16/178.62
FY17/189.04
FY18/199.14

Major Risk For Mapletree Commercial Trust To Take Note Of

One of the biggest short-term risks for Mapletree Commercial Trust is its rather high valuation. If, for any reason, the REIT doesn’t perform as well as the market expects it to, Mapletree Commercial Trust’s units could tank. 

Mapletree Commercial Trust’s Unit Price And Valuation

Mapletree Commercial Trust’s units performed exceptionally well over the last five years, having gone up by more than 60%.

Mapletree Commercial Trust unit price performance 5-years
Source: Google Finance

Right now, Mapletree Commercial Trust’s unit price is at S$2.32. At that price, it has a price-to-book ratio of 1.4 and a distribution yield of 4.0%. With MBC II’s addition, the yield is expected to rise to 4.2%.

Want To Discuss Further?

Why not check out Seedly’s QnA and participate in the discussion surrounding REITs like Mapletree Commercial Trust (SGX: N2IU) and many more!

Disclaimer: The information provided by Seedly serves as an educational piece and is not intended to be personalised investment advice. ​Readers should always do their own due diligence and consider their financial goals before investing in any stock.

About Sudhan P
It isn't fair competition when only one company in the world makes Monopoly. But I love investing in monopolies. Before joining the Seedly hood, I had the chance to co-author a Singapore-themed investment book – "Invest Lah! The Average Joe's Guide To Investing" – and work at The Motley Fool Singapore as an analyst.
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