Excerpts from CGSCIMB report

Manulife US Reit (SGX:BTOU)

Portfolio occupancy dipped in 3Q22 but reversions improved qoq to +4.3%. Near-term focus is on portfolio repositioning and capital management. Reiterate Add with a lower TP of US$0.69.

Highlights from 3Q22 business update

Manulife US Reit (MUST) achieved a lower portfolio occupancy qoq at 88.1% as at 3Q22 (vs. 90% at end2Q22), due mainly to lower take-up at Figueroa as major tenant Quinn Emanuel downsized its space by 71k sq ft, Physical occupancy at MUST’s buildings average 30+% as at end-3Q. Portfolio weighted average lease expiry stood at 4.9 years as at end-3Q.

Positive rental reversion of 4.3% in 3Q

MUST signed 61k sq ft of leases in 3Q22 (254k sq ft YTD), of which c.57% are new leases. New demand came from real estate, finance and insurance, professional services and advertising sectors. It achieved positive rental reversion of 4.3%...