CIRCULAR DATED 22 DECEMBER 2021
THIS CIRCULAR IS IMPORTANT AND
REQUIRES YOUR IMMEDIATE ATTENTION
MAPLETREE LOGISTICS TRUST
(Constituted in the Republic of Singapore
Pursuant to a trust deed dated 5 July 2004 (as amended))
Singapore Exchange Securities Trading Limited (the "SGX-ST") takes no responsibility for the accuracy or correctness of any statements or opinions made, or reports contained, in this Circular. If you are in any doubt as to the action you should take, you should consult your stockbroker, bank manager, solicitor, accountant or other professional adviser immediately.
If you have sold or transferred all your units in Mapletree Logistics Trust ("MLT", and the units in MLT, the "Units"), you should immediately forward this Circular, together with the Notice of Extraordinary General Meeting and the accompanying Proxy Form in this Circular, to the purchaser or transferee or to the bank, stockbroker or other agent through whom the sale or transfer was effected for onward transmission to the purchaser or transferee.
This Circular does not constitute an offer of securities in the United States or any other jurisdiction. The securities of MLT will not be registered under the U.S. Securities Act of 1933, as amended (the "Securities Act") or under the securities laws of any state or other jurisdiction of the United States, and any such securities may not be offered or sold within the United States except pursuant to an exemption from, or transactions not subject to, the registration requirements of the Securities Act and in compliance with any applicable state securities laws. Mapletree Logistics Trust Management Ltd., as manager of MLT (the "Manager"), does not intend to conduct a public offering of any securities of MLT in the United States.
CIRCULAR TO UNITHOLDERS IN RELATION TO:
- THE PROPOSED ACQUISITIONS OF (A) A 100.0% INTEREST IN 13 LOGISTICS ASSETS LOCATED IN THE PEOPLE'S REPUBLIC OF CHINA THROUGH THE ACQUISITION OF 13 PROPERTY HOLDING COMPANIES AND (B) A 100.0% INTEREST IN THREE LOGISTICS ASSETS LOCATED IN VIETNAM THROUGH THE ACQUISITION OF THREE PROPERTY HOLDING COMPANIES, AS INTERESTED PERSON TRANSACTIONS;
- THE PROPOSED ISSUE OF 106,382,979 NEW UNITS IN MLT AS PARTIAL CONSIDERATION FOR THE PRC ACQUISITIONS; AND
- THE PROPOSED WHITEWASH RESOLUTION.
IMPORTANT DATES AND TIMES FOR UNITHOLDERS
Last date and time for | 10 January 2022 |
pre-registration for Extraordinary | at 2.30 p.m. |
General Meeting ("EGM") | |
Last date and time for lodgement | 10 January 2022 |
of Proxy Forms | at 2.30 p.m. |
Date and time of EGM held at the | 13 January 2022 |
physical location below and by way | at 2.30 p.m. |
of electronic means | |
Physical location of EGM | 20 Pasir Panjang Road |
Mapletree Business City | |
Town Hall - Auditorium | |
Singapore 117439 | |
Managed by | Joint Global Co-ordinators and Bookrunners in relation to the Equity Fund Raising |
(as defined herein) |
MAPLETREE LOGISTICS TRUST
MANAGEMENT LTD.
Independent Financial Adviser to the Independent Directors, Audit and Risk Committee and the Trustee
(each as defined herein)
Overview of the Properties1
Aggregate Agreed | Net Property | Net Lettable Area | Committed | Weighted Average | |||||||||||||||
Property Value | Income ("NPI") Yield | ("NLA") | Occupancy | Lease Expiry ("WALE") | |||||||||||||||
S$1,014.6 million2 | ~5.1%3 | 1,051,525 sq m | 90.1% | 2.9 years4 | |||||||||||||||
China | Vietnam | ||||||||||||||||||
1 | Mapletree Wenzhou | 14 | Mapletree Bac Ninh 4 | ||||||||||||||||
2 | Mapletree Zhengzhou | 15 | Mapletree Bac Ninh 5 | No. of | |||||||||||||||
3 | Mapletree Yangzhou | Mapletree Logistics | 13 | 3 | |||||||||||||||
16 | Properties | ||||||||||||||||||
Park 5 | |||||||||||||||||||
4 | Mapletree Kunming | ||||||||||||||||||
5 | Mapletree Yuyao 2 | NLA ('000) | 863.0 sq m | 188.5 sq m | |||||||||||||||
6 | Mapletree Xi'an | ||||||||||||||||||
7 | Mapletree Yixing | Committed | |||||||||||||||||
88.0%5 | 100.0% | ||||||||||||||||||
8 | Mapletree Yantai | ||||||||||||||||||
Occupancy | |||||||||||||||||||
9 Mapletree Harbin
10 Mapletree Yuyao
WALE4 | 2.6 years | 3.9 years | ||
11 | Mapletree Chongqing | |||
12 | Mapletree Tianjin | Agreed | ||
13 | Mapletree Zhongshan | |||
Property | S$883.3 m | S$131.3 m | ||
All information is as at 14 December 2021 ("Latest Practicable Date") unless otherwise stated.
Value2
- Refers to the 100.0% interest in 13 PRC Properties and three Vietnam Properties.
- Based on the illustrative exchange rate of S$1.00 = RMB4.65 and S$1.00 = USD0.73.
- NPI yield includes Income Support.
- Weighted average lease expiry by proportionate NLA.
- Seven of the PRC Properties are currently undergoing stabilisation and hence are currently operating below current market levels.
MLT After the Acquisitions
Enlarged Assets Under Management of c. S$11.79 billion from c. S$10.76 billion
Before the | 2 | After the | % Change | |||
Acquisitions1 | Properties | Acquisitions | ||||
NLA | 6,463,362 sq m | 1,051,525 sq m | 7,514,887 sq m | 16.3% | ||
Assets Under Management | S$10,762.9 million | S$1,030.2 million3 | S$11,793.1 million | 9.6% | ||
WALE4 | 3.7 years | 2.9 years | 3.6 years | 2.7% | ||
Number of Tenants | 753 | 66 | 819 | 8.8% | ||
Occupancy Rate | 97.8%5 | 90.1%6 | 96.7% | 1.1% | ||
Aggregate Leverage | 39.0%7 | - | 39.1%8 | 0.1% | ||
(Pro forma as at 30 September 2021) | ||||||
Net Asset Value per Unit (S$) | 1.33 | - | 1.379 | 3.3% | ||
(Pro forma as at 31 March 2021) | ||||||
Source: Company information.
- As at 30 September 2021.
- As at the Latest Practicable Date.
- Based on the aggregate Agreed Property Value of the Properties, which includes any capitalised costs.
- Weighted average by proportionate leased NLA.
- Based on the actual occupancy.
- Based on the committed occupancy. The committed occupancy for the PRC Properties is 88.0% and for the Vietnam Properties is 100.0%.
- Pro forma as at 30 September 2021, including committed acquisitions announced to date (excluding the proposed acquisition of a logistics property in Japan (the "Japan Property"), further details of which are set out in the announcement by MLT dated 22 November 2021 and which was completed on 16 December 2021), partially funded by approximately S$150.0 million out of the gross proceeds arising from the issue of S$400.0 million in principal amount of 3.725% fixed rate subordinated perpetual securities (as first announced by the Manager on 26 October 2021).
- Includes gross proceeds of S$692.8 million from the Equity Fund Raising, S$200.0 million worth of Consideration Units, the Loan Facilities as well as the drawdown of debt facilities to part finance the proposed acquisition of the Japan Property.
- Includes (a) approximately 212.8 million New Units issued in connection with the Private Placement at an issue price of S$1.88 per New Unit and 51.6 million New Units issued in connection with the Preferential Offering at an issue price of S$1.84 per New Unit, (b) approximately 2,734,423 Acquisition Fee Units issued as payment of the Acquisition Fee payable to the Manager at an issue price of S$1.88 per Acquisition Fee Unit and (c) 106,382,979 Consideration Units issued at an issue price of S$1.88 per Consideration Unit.
1 Deepen Presence in Attractive Logistics Markets of China and Vietnam
Fast Growing Domestic Markets Supported by Resilient Economic Fundamentals
Relatively Low Urbanisation Rates with Significant Growth Potential | Robust Consumption Growth | |
Urban Population Growth and Percentage of Urban Population | Consumption Expenditure per Capita and Growth Rate | |
(%) | (USD'000, %) | |
31.4% 13.9% 20.4% 3.4% 14.2% -3.3% 6.3% 7.4%
100.0%
75.0%
50.0%
25.0%
0.0% | |||||||||
VN | CN | MY | SK | AU | JP | HK | SG | ||
Urban Population Growth Rate from 2020 - 2031F (%) | |||||||||
2020 Urbanisation Rate (%) | 2031F Urbanisation Rate (%) | ||||||||
Source: Independent Market Research Consultants.
1.9 | 4.0 | 28.2 | 19.7 | 30.8 | 14.8 | 42.4 | 21.4 |
10.0% |
Consumption expenditure per capita of China and
8.2% Vietnam was estimated to be 15% and 7% of the average of developed countries respectively, suggesting huge growth potential in the future
5.3%
4.5%
3.9% 3.7% 3.7%
2.6%
VN | CN | AU | SG | HK | SK | US | JP |
2020 Consumption Expenditure per Capita (USD'000) Consumption Expenditure per Capita Growth: '22F - '25F (CAGR)
Source: Independent Market Research Consultants.
Both China and Vietnam are projected to exhibit strong growth in their urban populations of 13.9% and 31.4% respectively, between 2020 and 2031
Consumption expenditure per capita of China and Vietnam is expected to grow at a compound annual growth rate ("CAGR") of 8.2% and 10.0% respectively from 2022 to 2025, amongst the highest growth rates in Asia Pacific
Increasing urbanisation and a growing middle class is expected to support rising consumption in both China and Vietnam, resulting in higher demand for logistics space
Limited Supply of Grade A Warehouse Space Presents Opportunity for MLT to Fill the Market Gap
Relatively Low Supply of Grade A Warehouse with Significant Headroom for Growth
Logistics Real Estate Space per Capita and Grade A Warehouse Supply as a % of Total Stock (sq m, %)
Average Rent Premium for Grade A vs. Traditional Warehouses
(%)
JP | 30% | |||||||||||||||||
6.5% | ||||||||||||||||||
US | ||||||||||||||||||
63.5% | 25% | |||||||||||||||||
SG | 20% | |||||||||||||||||
48.0% | ||||||||||||||||||
AU | 15% | |||||||||||||||||
80.7% | ||||||||||||||||||
CN | VN | |||||||||||||||||
CN | 6.8% | Rent Premium between Grade A and Traditional Warehouses (%) | ||||||||||||||||
Limited Supply | Significant | |||||||||||||||||
of Grade A | Headroom for | Source: Independent Market Research Consultants. | ||||||||||||||||
Warehouse | Growth | |||||||||||||||||
VN | 21.1% | |||||||||||||||||
Limited supply of Grade A warehouse | ||||||||||||||||||
0.0 | 0.5 | 1.0 | 1.5 | 2.0 | 2.5 | 3.0 | 3.5 | 4.0 | 4.5 | space across China and Vietnam | ||||||||
Total Logistics Real Estate Space per Capita (sq m) | Low logistics space per capita vs countries | |||||||||||||||||
like Japan and the US suggests significant | ||||||||||||||||||
Grade A Warehouse Supply (% of total stock) | headroom for growth | |||||||||||||||||
Source: Independent Market Research Consultants. | Grade A warehouse space commands | |||||||||||||||||
a sizeable rent premium over traditional | ||||||||||||||||||
warehouses |
1 Deepen Presence in Attractive Logistics Markets of China and Vietnam (Cont'd)
Augmenting Growth while Maintaining Large Exposure to Developed Markets in Asia-Pacific
Existing Portfolio
Assets under Management ("AUM") and Gross Revenue
Enlarged Portfolio1
Assets under Management and Gross Revenue
(SGD million, %)
0.8% | |||
1.8% | 24.1% | ||
2021) | 75.9% | ||
4.7% | |||
(SGD million, %)
0.7%
2.8%22.0%
4.3%
69.3%
AUM 30Sep | 16.8% | S$10,762.9 | |||||||||||
million | 24.7% | ||||||||||||
at | |||||||||||||
(as | 8.2% | ||||||||||||
7.7% | 11.2% | ||||||||||||
1.2% | |||||||||||||
3.0% | 29.2% | ||||||||||||
6-Month Gross Revenue (as at 30 Sep 2021) | 71.6% | ||||||||||||
5.4% | |||||||||||||
S$328.8 | |||||||||||||
18.8% | million | 17.6% | |||||||||||
7.7% | 10.0% | ||||||||||||
7.1% | |||||||||||||
Singapore | Hong Kong SAR | Japan | Australia | South Korea | |||||||||
Source: Company information.
- Excludes the proposed acquisition of the Japan Property.
S$11,793.1
22.9% million 22.6%
7.5% | 10.2% |
7.0% |
1.0%
4.1% | 26.5% | |
65.1% | ||
4.9% |
S$362.4
million 16.0%
24.9%
9.1%
7.0% 6.5%
China Malaysia Vietnam India Developed Markets
2 Capture Opportunities from Structural Trends Accelerated by the COVID-19 Pandemic
COVID-19 Fueling the Rapid Growth of the E-commerce Logistics Market
E-commerce Logistics Market Size and Growth (USD billion, %)
"China Plus" Strategy to Benefit Vietnam
Registered FDI Investment and Registered Capital Growth (USD billion, %)
0.6 | 138.7 | 0.6 | 1.0 | 14.2 | 5.2 | 150.0 | 16.9 | 40.0 | 60.0% |
19.9% | |||||||||
~ 1.6x - 2.7x that of average developed countries | 35.0 | 50.0% | |||||||
30.0 | 40.0% | ||||||||
25.0 | 30.0% | ||||||||
12.0% | Average Developed | ||||||||
20.0% | |||||||||
10.2% | Countries' Growth: 7.4% | 20.0 | |||||||
8.7% | 10.0% | ||||||||
7.2% | 6.1% | 6.0% | 6.0% | 15.0 | 0.0% | ||||
10.0 | (10.0)% | ||||||||
5.0 | (20.0)% | ||||||||
0.0 | (30.0)% |
VN | CN | SG | HK | SK | AU | US | JP | 2016 | 2017 | 2018 | 2019 | 2020 2021F 2022F | |
2020 E-commerce Logistics Market Size (USD billion) | Registered Capital (USD billion) | ||||||||||||
Forecast E-commerce Logistics Market Size Growth: '20 -'25F (CAGR) | Registered Capital Growth (%) | ||||||||||||
Source: Independent Market Research Consultants. | Source: Independent Market Research Consultants. |
Rapid rise of e-commerce has bolstered demand for logistics space, with tenants favouring modern Grade A logistics facilities
"Just-in-Time" to "Just-in-Case"
Increased Emphasis on Supply Chain Security and Resilience
Despite the COVID-19 pandemic, Vietnam's FDI has increased by 4.4% (first 9 months of 2021) Vietnam is expecting a strong FDI growth of 19.9% in 2022
Supply chain resilience will be prioritised over efficiency especially for businesses operating in critical sectors increase "safety stock"
Inventory of retailers is expected to grow by 10% to 15% to serve as buffer stock
Above structural trends will boost demand for warehouse space, especially for modern Grade A warehouses
3 Strengthen MLT's Network Connectivity across Key Logistics Nodes
Deepen and Expand Coverage across Key Cities in China with Addition of Three New Provinces
Narrowing Consumption Gap between | |||||
Tier 1 & Non-Tier 1 Cities | |||||
Urban Consumption Expenditure per Capita in China | |||||
(RMB) | |||||
Heilongjiang | |||||
Jilin | |||||
Xinjiang | Liaoning | 74,678 | |||
Beijing | 30% | ||||
Inner Mongolia | 52,124 | ||||
42,125 | |||||
41% | |||||
Hebei | Tianjin | ||||
Ningxia | Shanxi | 24,838 | |||
Qinghai | Shandong | ||||
Gansu | 2020 | 2031 | |||
Shaanxi | Henan | Jiangsu | |||||
Tibet | |||||||
Anhui | Shanghai | ||||||
Sichuan | Hubei | ||||||
Chongqing | Jiangxi | Zhejiang | |||||
Hunan | |||||||
No. of | NLA | Guizhou | Fujian | ||||
Assets | (sq m) | Yunnan | |||||
Existing | Taiwan | ||||||
30 | 2,006,791 | Guangxi | Guangdong | ||||
assets | |||||||
Hong Kong | |||||||
New | |||||||
13 | 863,015 | Macau | |||||
assets | |||||||
Tier 1 Cities | Non-Tier 1 Cities |
Source: Independent Market Research Consultants.
Growing Network Effect
Expand network in China to 43 assets covering 29 cities
57% of tenants in China will be leasing space in more than one MLT asset in China
Total | 43 | 2,869,806 | Hainan | Enlarged portfolio has access to an |
aggregate population base in China of |
Source: Company information. | >142 million people |
Deepen Presence In Thriving Logistics Hubs of Vietnam
Bac Ninh | Lang Son | |
ai | ||
Nguyen | ||
Int'l Airport | Bac Giang | Quang Ninh |
Bac Ninh | ||
Mapletree Bac Ninh 4 | ||
Hanoi Mapletree Bac Ninh 5 | ||
Hai Phong | ||
Hai Phong | ||
Port | ||
Binh Duong | ||
Mapletree | Bien Hoa | |
Railway | ||
Logistics Park5 | ||
Ho Chi | Dong | |
Minh City | ||
Nai | ||
Tan Son Nhat | Long Thanh | |
Int'l Airport | Int'l Airport |
Tan Cang - Cat Lai
Terminal Port
Saigon
Railway
Binh Duong
Location of Existing Assets Location of New Assets to be Acquired
Key Attractiveness of Bac Ninh
Close proximity to Hanoi, the largest consumption market in Northern Vietnam, allows it to serve as the logistics and distribution hub for domestic consumption
Home to a prominent electronics cluster with many global multinational corporations setting up production bases in the region
Attractive to foreign investors with its close proximity to China, which allows manufacturers to source supplies from Southern China, and access to an abundant workforce
3rd highest recipient of FDI in Northern Vietnam
Key Attractiveness of Binh Duong
Close proximity to Ho Chi Minh City, the largest consumption market in Vietnam, creates strong demand for warehouse space to support e-commerce and local retailers
Largest warehouse market in Southern Vietnam, accounting for about half of its total supply
Demand for logistics facilities is sustained by a thriving manufacturing sector, as Binh Duong is home to the country's largest southern industrial zones
2nd highest recipient of FDI in Southern Vietnam
Sources: Independent Market Research Consultants and company information.
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Mapletree Logistics Trust published this content on 22 December 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 22 December 2021 15:56:07 UTC.