MacarthurCook Industrial Reit launches $297m IPO

MACARTHURCOOK Industrial real estate investment trust (MI Reit), which launched its $296.8 million initial public offering (IPO) yesterday, will be Singapore's fourth industrial Reit.

The Reit's initial property portfolio consists of 12 industrial properties in Singapore, with a net lettable area of 195,000 sq m and a total valuation of $316.2 million.

They include warehouses and factories, whose tenants are in sectors such as construction, manufacturing, logistics and warehousing.

MI Reit will offer 247.3 million units at $1.20 apiece, with a forecast distribution of 7.4 cents per unit, or an annualised yield of 6.18 per cent for its current fiscal year.

A Reit owns a portfolio of properties and gets income from rentals - then makes regular payments to investors, similar to dividends.

MI Reit plans to distribute all of its taxable income from its listing date until March 31 next year, and at least 90 per cent of taxable income thereafter.

The Reit's manager will be jointly owned by Australia-listed real estate manager MacarthurCook, and a unit of Singapore-listed United Engineers.

MI Reit said its portfolio enjoys a quality tenant base with more than 70 per cent of rental income coming from firms listed on the Singapore Exchange, including Ossia International and GRP.

Said MI Reit chief executive Chris Calvert: 'We aim to have a minimum of 40 per cent of our portfolio located in Singapore over time and the balance across the other major Asian industrial property markets such as Hong Kong, China, Malaysia, Japan and India.'

He also targets to grow MI Reit by up to $500 million in new investments each year.

The IPO will close at noon next Tuesday, and trading is expected to start next Thursday.