Newly Issued Bond: Mapletree Pan Asia Commercial Trust 7-year SGD Senior Green Notes; IPG of 2.80%

• Mapletree Pan Asia Commercial Trust (MPACT) intends to issue a new tranche of SGD-denominated senior Green Notes. The notes come with a 7-year tenor and an initial price guidance of around 2.80%. Proceeds raised from this issuance will be strictly allocated to finance or refinance eligible green projects in accordance with the Mapletree Pan Asia Commercial Trust Green Finance Framework. Settlement is expected on 25 June 2026, with a standard institutional denomination size of SGD 250,000.

• Backed by its sponsor, Mapletree Investments, and top-tier commercial real estate assets, MPACT’s operational profile remains fundamentally sound. As of 31 March 2026, the trust maintains a portfolio committed occupancy of 89.4% and a portfolio weighted average lease expiry (WALE) of 2.4 years. While its Singapore crown jewels like VivoCity and Mapletree Business City provide a highly resilient structural floor for the trust’s cash flow, this domestic strength is partially offset by macro crosswinds in its North Asian portfolio.

• For the full financial year (FY25/26), MPACT’s portfolio gross revenue dropped by 4.4% year-on-year (YoY) to SGD 879.3 million, while net property income (NPI) fell by 4.1% YoY to SGD 663.6 million. This compression was driven primarily by lower contributions from international segments like Japan and Festival Walk in Hong Kong. However, the trust's domestic portfolio provided a critical structural buffer where Singapore properties delivered 4.1% higher NPI (an increase of SGD 16.9 million).

• MPACT’s debt and leverage profile has shown clear, active improvement following a period of structural reshaping. The trust successfully reduced its aggregate leverage to 36.5% (down from 37.7% the prior year), driven by the completion of three non-core property divestments, with net proceeds directly deployed toward debt reduction. This helped lower its weighted average cost of debt to 3.16% and strengthened its trailing interest coverage ratio (ICR) to 3.2x (up from 2.8x). For fixed-income investors, the debt maturity profile is comfortably distributed, with no single financial year facing more than 23% of total refinancing needs, and interest rate risk is well-insulated with 75.1% of debt maintained on fixed rates. 

• Looking at MPACT's own existing bonds, this new 7-year note at 2.80% offers a noticeably higher yield than what its older bonds are currently trading at. The two bonds maturing in March 2032 are currently priced to yield around 2.37%–2.43%, while the bond maturing in March 2034 yields around 2.56%. So relative to where MPACT's debt already trades in the market, the new bond is offering investors an extra 25–35bps of yield pickup for taking on slightly longer duration.

• Compared to similar bonds from other Singapore REITs, MPACT's 2.80% guidance sits in a reasonable middle ground. CapitaLand Integrated Commercial Trust (CICT), which is generally seen as the safest and highest-quality S-REIT borrower, issued a similar 7-year bond in late 2025 at just 2.25%. On the other end, Suntec REIT, which does not carry a formal credit rating and has a weaker balance sheet (aggregate leverage ratio of 41.5% as of 31 December 2025, which is significantly higher than the S-REIT market average of 39%) offers 3.40%. MPACT at 2.80% lands between those two, which feels about right given that it carries an investment-grade rating but also comes with some ongoing concerns around its overseas properties.

• MPACT's new bond offers a decent yield of around 2.80% from a name with a solid Singapore property portfolio and an improving financial position. However, do note that 2.80% IPG is our reference, though the final price guidance (FPG) is likely to come in below the 2.80% IPG level. On balance, this bond is fairly priced for investors comfortable with investment-grade Singapore REIT credit, but it is not a standout buy.

Table 1: Bond Comparison