pare down outstanding debt to lower our aggregate leverage and strengthen our overall balance sheet. The interest rate outlook remains uncertain due to persistent inflationary and geopolitical pressures surrounding U.S. monetary policy. U.S. Treasury yields rose significantly in early March 2026, driven by surging oil prices and heightened inflation fears amidst the Middle East conflict. As at 31 December 2025, 74.6% of our total borrowings are fixed rate or hedged loans. We will continue to closely monitor the interest rate landscape, taking into account loan maturities and debt repayments, to determine the most appropriate hedging strategy. We will also maintain our focus on strengthening portfolio quality through disciplined capital allocation. Capital will be selectively redeployed into new acquisitions and/or investment into existing assets, where the opportunities provide higher risk-adjusted returns, with the goal of creating long-term value for Unitholders. Q4 What sustainability milestones did MUST achieve in 2025, and what are the plans for the year ahead? A John: Sustainability remains a cornerstone of our strategy and continues to guide our decision-making across the portfolio. In 2025, MUST earned a 5 Star rating in the GRESB Real Estate Assessment for the eighth consecutive year and achieved an ‘A’ grade in public disclosure, ranking second among 10 U.S. office peers. We were also ranked 13th out of 42 REITs and business trusts in the 2025 Singapore Governance and Transparency Index, underscoring strong governance practices. This year, we strengthened the transparency of our sustainability reporting by aligning our disclosures with the International Sustainability Standards Board (ISSB) framework and SGX RegCo’s Roadmap for Mandatory Climate Reporting. These enhancements reinforce our commitment to operating in accordance with global best practices and regulatory expectations. We delivered meaningful progress in our environmental performance, achieving significant reductions in energy intensity and greenhouse gas (GHG) emissions intensity compared to our 2018 baseline. In addition, we reached an important milestone by publishing our first disclosure of Scope 3 GHG emissions, reflecting our progress toward more comprehensive environmental reporting. Going forward, we will continue to work on deepening our understanding of our environmental impact. Our efforts will position us for long-term resilience and sustainable growth as we diversify beyond the U.S. office sector to include other property sectors in the U.S. and Canada. Q5 What are your key priorities in 2026? A Mushtaque: Our immediate priority is to meet the Minimum Sale Target under the MRA by 30 June 2026. With the approval of the Growth and Value Up Plan by our Unitholders, we do have greater flexibility to dispose of up to US$350 million of existing properties under the Disposition Mandate. We will optimise the allocation of divestment proceeds, either to repay debt, to fund investments under the Acquisition Mandate, or for capital expenditures, tenant incentives and leasing costs. Once we are able to exit the MRA, we will prioritise resuming distributions at a sustainable level1. Another of our key priorities in 2026 is to strengthen our cash flows and credit profile through strategic diversification into industrial, living sector and retail assets. We will target acquisitions funded with the capital structure of no more than 40% debt, so as to gradually lower the REIT’s aggregate leverage. We will also tap on our Sponsor’s platform and expertise to source for the best acquisition opportunities for MUST. Embarking on our portfolio diversification into higher yielding, less capital intensive assets will enable MUST to pivot to the Recovery and Growth phases, which was always the objective of the Recapitalisation Plan from the onset. This, alongside continuing to improve the performance of our existing portfolio through strategic leasing, will constitute our strategy for 2026. 1 Pursuant to the Recapitalisation Plan and the entry into the MRA, Manulife US REIT has halted distributions to Unitholders since 2023. Further to the granting of the MRA Concessions, the lenders have required Manulife US REIT to keep half-yearly distributions to Unitholders suspended until the later of the achievement of the Reinstatement Conditions and the period during which the Bank ICR relaxation remains in effect. / 11 / MANULIFE US REIT
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