Manulife US Reit proposes strategic pivot to retail, living, industrial sectors
It seeks mandates for US$350 million in divestments and US$600 million in acquisitions
[SINGAPORE] Manulife US Reit is seeking unitholder approval for an expansion of its investment mandate beyond the US office sector, and into new asset classes across the US and Canada.
In an announcement on Monday (Dec 1), the manager of the pure-play US office real estate investment trust (Reit) outlined plans to revitalise its portfolio by diversifying into industrial, living-sector, and retail assets in the US and Canada. This move comes amid continued headwinds in the US office sector.
To execute this pivot, the manager is seeking unitholder approval for a disposition mandate and an acquisition mandate that will run from Jan 1, 2026, to Apr 30, 2027.
The disposition one authorises the sale of up to three existing properties to raise aggregate net proceeds not exceeding US$350 million. Proceeds are intended to be used to acquire new assets, repay debt, and fund capital expenditures, tenant incentives and leasing cost requirements.
The acquisition one authorises investments in the new asset classes with an aggregate agreed property value not exceeding US$600 million.
The manager stated that acquisitions under this mandate will be funded with a capital structure of no more than 40 per cent debt, with the remaining 60 per cent funded through equity sources – including divestment proceeds.
The manager highlighted that the US office market has faced significant structural shifts post-pandemic, including hybrid work trends.
“These shifts have slowed recovery in some submarkets, leaving some office assets stranded and in need of repurposing,” it added.
An extraordinary general meeting will be convened to seek approval for these resolutions.
Decoding Asia newsletter: your guide to navigating Asia in a new global order. Sign up here to get Decoding Asia newsletter. Delivered to your inbox. Free.
