$Mapletree NAC Tr(RW0U.SI)

Buildings : SII Makuhari Building & Fujitsu Makuhari Building

Location: Chiba prefecture, Japan.

Date : November 2018.

Mapletree Greater China Commercial Trust was listed in 2013
and managed overseas commercial properties in China and Hong Kong.  Earlier this year, with the acquisition of
Japanese properties into its portfolio, it changed its name to Mapletree North
Asia Commercial Trust.

I started to took notice and then shortly thereafter took up a position.  With the trade war with U.S and China at the
forefront, I reckon that a more diversified portfolio would be beneficial so
properties in Japan would be a good balance. 
It would be better if they can get some South Korean commercial properties
but I think it is good to keep within 2- 3 countries as exchange rates maybe a
double edged sword.

Gearing ratio had increased to 39% (Sep 2018) from 36% ( Mar 2018) but I am not too concerned.

It is well under 45%; of which it is the requirement of SGX.  Its interest rates is at about 2.5 % and 78%
of MNACT debt is of fixed interest rate so the impending rise of interest rates
in the coming year should be well cushioned. 
NPI contribution for the Japanese properties stood at a meagre 8% when
compared to its China and Hong Kong properties.   I think it will be poised for growth and
that is why I went to do a on the ground check.

SII Makuhari Building and Fujitsu Makuhari Buildings  are separate by 2 buildings   (Starts and Sharp buildings to be exact).  They are located about 8 - 10 minutes walk
from Kaihimmakuhari station.

Basically it is office area so you won’t see residential place near by.  There are eateries, shops, amusement park and
a cinema inside a mall next to the station. As these buildings housed the same
company, I don’t forsee units being further lease out.  The WALE is 5.2 years and it is much better
than the China and Hong Kong ones.  The
occupancy rate thus is 100%.

One of the few things that Japan did somewhat better than Singapore is the
accessibility between buildings.  Besides
walking on the pedestrian level ( same as car, bus etc..), the buildings are
interconnected via open bridges and these walkway between bridges are huge.  You may think as Japanese are time efficient people
and take about 20 min through and flow to commute for lunch is not too wasteful.  Fret not, many if not all of the buildings
have a staff canteen in the office building and some of them order in if the
schedule is tight.

Makuhari area is in Chiba prefecture, it is close to Narita airport.  Coming in from Tokyo will take you about 28
minutes.  It seems that MNACT is growing
its presence in Makuhari area.  Why?

As I was walking down, I saw Baypoint but I do not recall it being listed in
their slides previously.

Could it be a new acquisition?  Btw, the
Baypoint is a 26 storey office building.

As my foray into the counter only started this year, my price isn’t that attractive
as compared to those who bought earlier. 
I made an entry when the technicals were showing a bit of weakness and
added a bit more recently.  With a high
yield of more than 6% and P/NAV less than 1, my quarterly dividend is in the
high 3 digits, I will continue to hold this for dividend income.

Finally, before heading back to Tokyo, I had a bowl of yummy oyster noodles.

If you like to read on my previous overseas post on Starhill
Global Reit, you can visit the link

https://www.investingnote.com/posts/380685

Read more
29 likes
73 comments
ramenking

fed dovish hence reits today all doing quite ok

Spinning_Top

Reply to @ramenking : Interest rates may not rise so fast but Trump shu shu tariffs are negating the positive news

opy

she not alone, go chk reits

opy

Reply to @Spinning_Top : thanks, just less negative only ;-)

  View More Replies Small loading
Spinning_Top

Woah..what is happening?
It touches 1.14....

FeelsBadMan

Reply to @Spinning_Top : My MLT also 1.27. MCT 1.63. Left MINT haven't collect

  View More Replies Small loading
layers

looking at the properties and photo. kinda boring to pay a visit lol. not like shopping mall. can shop at the same time.

layers

got 6 properties right. do u plan to go all 6? haha

threewhitecro

Reply to @Spinning_Top : my bad for not reading all the comments :)

  View More Replies Small loading
BobTravels

Paul Ma Kah Woh, Non-Executive Chairman of MNAC purchased 200,000 unit @1.12 in the market on 24th September 2018.

http://infopub.sgx.com/FileOpen/_MNACTM_Fo...

"There are many reasons why directors sell shares, there is only one reason why they buy them....."

I have a few units.

losemoneyinvestor

Reply to @BobTravels : On a broad stroke and not specific to any companies, would a director buy shares to support share price,, if the shares are pledged for personal loan?

  View More Replies Small loading
threewhitecro

Little capital gain to be had for this counter on the short term, basically it's a stable dividend yielding olympic 2020 play.

threewhitecro

Reply to @layers : The timing of the Japan acquisitions does suggest there is an olympic angle to it, although office buildings do not gain a direct benefit from tourism compared to hotels.

According to Nikkei Asia Review reports, in 2018 land prices in Japan log first rise in 27 years on foreign investment, Tokyo's real estate market is booming ahead of olympics, the influx of foreign funds and rising rents have pushed up prices of office buildings and commercial facilities.

According to office brokerage Miki Shoji, office rents in Tokyo's five central wards hit 20,108 yen per 3.3 sq. meters in June, the highest rate since June 2009.

  View More Replies Small loading
Pizzaprata

Thanks for sharing. I'm also a recent investor when the share price weakened. This Reit's track record has been excellent so far. One problem with ground check of office buildings is we can't enter the building unlike Shopping Malls. The Baypoint building is owned by the parent company so it's an opportunity for growth.

Pizzaprata

Reply to @layers : It's a turnaround play. The entire sector is at the bottom, it should improve from next year as the supply will be less than the average demand for the first time in many years.

  View More Replies Small loading
changyuesin

39% is near dangerous boundaries, in times of uncertainty and interest spikes or if rental income falls

layers

Reply to @changyuesin : wat to do. thst is their usual status. throughout the yes. their gearing is kept bear 40%

latemonkey

Thanks for the report. Have been eyeing this. Last one of the MapleTree quartet to keep in the pocket.

View More Comments (10) Small loading

There are more for you ...

View more and participate in our discussion now. It's FREE.

Creating an account means you’re okay with InvestingNote's Terms and Conditions