REIT-TIREMENT - REITs Investing & Personal Finance

REITs investing & personal finance

Tuesday, August 23, 2022

Manulife US REIT Review @ 23 August 2022

Basic Profile & Key Statistics

  • Main Sector(s): Office
  • Country(s) with Assets: United States
  • No. of Properties (exclude development/associate/fund): 12

Key Indicators

Performance Highlight

Gross revenue, NPI and distributable income improved yoy mainly due to contributions from newly acquired properties, Tanasbourne, Park Place and Diablo in December 2021, higher carpark income and lower rent abatements provided. However, DPU is lower due to an enlarged unitholder base.

Rental Reversion
Rental reversion for 1H 2022 is at 1%.

Sensitivity to Interest Rate
For every 1% increase in interest rate, DPU is impacted by 0.079 cents, which is around 1.5%.

Related Parties Shareholding

  • REIT sponsor's shareholding: Below median for more than 20%
  • REIT manager's shareholding: ± 10% from median
  • Directors of REIT manager's shareholding: Below median for more than 10%

Lease Profile

  • Occupancy: Below median for more than 5% 
  • WALE: Above median for more than 20% 
  • Highest lease expiry within 5 years: Below median for more than 20%; Falls in 2025
  • Weighted average land lease expiry: 100% freehold properties

Debt Profile

  • Gearing ratio: Above median for more than 10%
  • Cost of debt: Above median for more than 10%
  • Fixed rate debt %: Above median for more than 10%
  • Unsecured debt %: Below median for more than 10%
  • WADM: Below median for more than 10%
  • Highest debt maturity within 5 years: Below median for more than 10%; Falls in 2026
  • Interest coverage ratio: Below median for more than 10%

Diversification Profile

  • Top geographical contribution: Below median for more than 20%
  • Top property contribution: Below median for more than 20%
  • Top 5 properties' contribution: ± 10% from median
  • Top tenant contribution: Below median for more than 20%
  • Top 10 tenants' contribution: Below median for more than 10%

Key Financial Metrics

  • Property yield: ± 10% from median
  • Management fees over distribution: Below median for more than 20%; $10 distribution for every dollar paid 
  • Distribution on capital: Above median for more than 10%
  • Distribution margin: ± 10% from median


  • Slight Downtrend: Property Yield
  • Downtrend: DPU, NAV per Unit, Occupancy, Interest Coverage Ratio, Distribution on Capital, Distribution Margin

Relative Valuation

  • P/NAV - Below -1SD for 1y, 3y & 5y
  • Dividend Yield - Above +2SD for 1y, 3y & 5y

Author's Opinion

 Favorable Less Favorable
Long WALELow REIT Sponsor's Shareholding
Well Spread Lease ExpiryLow Directors of REIT Manager's Shareholding
100% freehold propertiesLow Occupancy
High Fixed Rate Debt %High Gearing Ratio
Well Spread Debt MaturityHigh Cost of Debt
Low Top Geographical ContributionLow Unsecured Debt %
Low Top Property ContributionShort WADM
Low Top Tenant & Top 10 Tenants ContributionsLow Interest Coverage Ratio
Competitive Management FeesDPU Downtrend
High Distribution on CapitalNAV per Unit Downtrend
 Occupancy Downtrend
 Interest Coverage Ratio Downtrend
 Distribution on Capital Downtrend
 Distribution Margin Downtrend

Despite improvement for distributable income, DPU has declined slightly due to enlarge unitholder base. Occupancy has also declined to 90%. From the presentation, the manager mentioned about the hotelisation of office could be a new normal where MUST would partner with flex operators and shortlist assets for these.

You could also refer below for more information:

SREITs Dashboard - Detailed information on individual Singapore REIT

SREITs Data - Overview and Detail of Singapore REIT

REIT Analysis - List of previous REIT analysis posts

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*Disclaimer: Materials in this blog are based on my research and opinion which I don't guarantee accuracy, completeness, and reliability. It should not be taken as financial advice or a statement of fact. I shall not be held liable for errors, omissions and loss or damage due to the use of the material in this blog. Under no circumstances does the information presented on this blog represent a buy, sell, or hold recommendation on any security, please always do your own due diligence before any decision is made.

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