Singapore’s REIT Sector has averaged a 2.1% YTD gain, taking the average 12-month total return to 13.2%. The Bloomberg Asia REIT Index performed similarly with a 0.8% YTD gain, and 12-month 12.3% total return.
Retail REITs have been the best-performing REIT segment in the 2017 YTD, in addition to the last three years, with average 36.7% total returns. The Retail REITs also maintain the lowest average debt-to-asset ratios and the second-highest ROE history amongst the five REIT segments.
Yesterday, SPH REIT reported a 0.8% year-on-year rise in distribution per unit (DPU) to 1.34 Singapore cents for the first quarter ended 30 November 2016, as the two key properties in its portfolio continued to deliver a steady performance despite the challenging retail environment. The largest of the Retail REITs, CapitaLand Mall Trust, will report on 20 January.
The REIT Sector bounced back last year as the preceding year’s expectations of up to four US interest rate hikes in 2016 did not materialise, with just the one rate hike in December.
Singapore’s REIT segments are made of at least five different trusts – they include those that invest in properties related to retailing, office and commercial space, industrial buildings, warehouses and parks, hotels and resorts, in addition to diversified and specialised properties. This is according to GICS® categorisations. Singapore also hosts relatively smaller REIT segments investing in residential and healthcare related properties.
Among the bigger REIT segments, Retail REITs have been the strongest performers over the first seven sessions of 2017, in addition to the last three years. Retail REITs hold properties meant for retail activities such as shopping centres and shopping malls. In Singapore, Retail REITs represent the largest segment of REITS by market capitalisation in Singapore. The property assets of Retail REITs are typically very visible and consist of either suburban malls driven by necessity spending, such as food and non-durables, or downtown malls driven by durables, luxury and tourism spending.
The relative performance of the biggest REIT segments are detailed in the table below, which is sorted according the three-year returns.
Singapore’s Biggest REIT Segments – Average Returns & Ratios
| GICS® REIT Sub-Industry | Average Mkt Cap S$B |
Total Return YTD % |
Total Return 1 Yr % |
Total Return 3 Yr % |
Debt/Assets (%) |
ROE % |
ROE 5 Yr Avg % |
Dvd Yld % |
260D Vol (%) |
|---|---|---|---|---|---|---|---|---|---|
| Retail REITs | 2.6 | 3.4 | 14.3 | 36.7 | 31.6 | 7.6 | 8.7 | 6.4 | 21.4 |
| Diversified/ Specialised REITs | 2.0 | 2.3 | 16.7 | 29.2 | 36.3 | 8.3 | 9.9 | 7.4 | 18.0 |
| Office REITs | 1.9 | 2.8 | 21.1 | 21.3 | 36.6 | 6.6 | 7.0 | 7.1 | 17.9 |
| Industrial REITs | 1.9 | 0.6 | 4.8 | 11.1 | 33.3 | 1.0 | 4.1 | 8.1 | 17.7 |
| Hotel & Resort REITs | 1.1 | 2.0 | 5.3 | 5.1 | 35.2 | 6.3 | 6.1 | 7.1 | 18.0 |
Source: SGX, Bloomberg & SGX StockFacts (data as of 11 January 2017)
As tabled above, Retail REITs have averaged a 3.4% total return in the 2016 year to date, taking their average 12 month return to 14.3%. Retail REITs have been the strongest segment in the year to date, in addition to the last three years, with average 36.7% total returns. The Retail REITs also maintain the lowest average debt to asset ratios and the second highest Return on Equity (ROE) history amongst the five REIT segments. However, on average, Retail REITs were also the most volatile over the past 12 months, and maintain the lowest average indicative dividend yields amongst the five REIT segments.
Yesterday, one of the nine Retail REITs listed in Singapore, SPH REIT, reported a 0.8% year-on-year rise in distribution per unit (DPU) to 1.34 Singapore cents for the first quarter ended 30 November 2016, as the two key properties in its portfolio continued to deliver a steady performance despite the challenging retail environment. Net property income gained 3.3% from the year-earlier period to S$41.4 million, while gross revenue rose 0.9% to S$52.6 million. The largest of the Retail REITs, CapitaLand Mall Trust, will report on 20 January.
The Broad REIT Sector
The 32 Real Estate Investment Trusts (REITs) and six stapled trusts listed in Singapore have averaged a 2.1% return over the first seven sessions of 2017, taking their average 12 month total return to 13.2%. The 38 trusts maintain an average indicative yield of 7.1%, with Industrial-related REITS maintaining the average highest indicative yields.
To see more details on each of the below trusts, click on the trust name to see the full profile in SGX StockFacts.
| Name | SGX Code |
Market Cap S$Bln |
Total Return YTD % |
Total Return 1 Yr % |
Total Return 3 Yr % |
P/B (x) |
Dvd Ind Yld % |
|---|---|---|---|---|---|---|---|
| CapitaLand Mall Trust | C38U | 7.1 | 6.6 | 11.6 | 26.6 | 1.1 | 5.5 |
| Ascendas REIT | A17U | 6.9 | 7.0 | 16.1 | 34.7 | 1.2 | 6.3 |
| CapitaLand Commercial Trust | C61U | 4.6 | 7.1 | 29.2 | 28.8 | 0.9 | 5.5 |
| Suntec REIT | T82U | 4.4 | 3.9 | 19.2 | 30.1 | 0.8 | 5.9 |
| Mapletree Commercial Trust | N2IU | 4.2 | 5.4 | 23.9 | 49.4 | 1.1 | 5.6 |
| Keppel REIT | K71U | 3.5 | 5.4 | 27.5 | 11.7 | 0.8 | 6.0 |
| Fortune REIT | F25U | 3.1 | 3.6 | 25.4 | 97.4 | 0.7 | 5.5 |
| Mapletree Industrial Trust | ME8U | 3.0 | 0.9 | 18.4 | 52.7 | 1.2 | 6.8 |
| Mapletree Greater China Commercial Trust | RW0U | 2.7 | 2.1 | 19.3 | 47.0 | 0.8 | 7.4 |
| Mapletree Logistics Trust | M44U | 2.6 | 3.9 | 16.9 | 23.8 | 1.1 | 7.1 |
| SPH REIT | SK6U | 2.5 | 2.1 | 9.5 | 15.4 | 1.0 | 5.8 |
| Ascott Residence Trust | A68U | 1.9 | 3.5 | 12.2 | 16.6 | 0.9 | 6.9 |
| Frasers Centrepoint Trust | J69U | 1.8 | 5.0 | 15.8 | 34.3 | 1.0 | 5.7 |
| Starhill Global REIT | P40U | 1.7 | 4.1 | 13.4 | 22.5 | 0.8 | 6.8 |
| Parkwaylife REIT | C2PU | 1.4 | 0.8 | 12.4 | 18.5 | 1.4 | 5.1 |
| Frasers Logistics & Industrial Trust | BWQU | 1.4 | 2.2 | N/A | N/A | 1.0 | N/A |
| Keppel DC REIT | AJBU | 1.4 | 1.7 | 28.9 | N/A | 1.3 | 5.5 |
| CDL Hospitality Trusts | J85 | 1.4 | 4.5 | 17.6 | 2.8 | 0.9 | 6.4 |
| CapitaLand Retail China Trust | AU8U | 1.2 | 4.4 | 8.8 | 33.2 | 0.9 | 7.5 |
| OUE Hospitality Trust | SK7 | 1.2 | 3.0 | 5.3 | 5.1 | 0.9 | 7.2 |
| Frasers Hospitality Trust | ACV | 1.2 | 1.5 | -0.9 | N/A | 0.8 | 7.0 |
| Far East Hospitality Trust | Q5T | 1.1 | 0.0 | 2.2 | -11.8 | 0.6 | 7.5 |
| Lippo Malls Indonesia Retail | D5IU | 1.0 | 0.0 | 35.8 | 14.3 | 0.9 | 9.2 |
| Frasers Commercial Trust | ND8U | 1.0 | 0.4 | 11.9 | 23.3 | 0.8 | 7.7 |
| First REIT | AW9U | 1.0 | 2.4 | 18.2 | 47.7 | 1.3 | 6.5 |
| OUE Commercial REIT | TS0U | 0.9 | 0.7 | 18.1 | N/A | 0.8 | 7.7 |
| AIMS AMP Capital Industrial REIT | O5RU | 0.9 | 2.7 | 10.2 | 26.1 | 0.9 | 8.2 |
| Ascendas Hospitality Trust | Q1P | 0.8 | 0.7 | 2.3 | 24.1 | 0.8 | 7.5 |
| Manulife US REIT | BTOU | 0.8 | 1.3 | N/A | N/A | 1.1 | N/A |
| Cache Logistics Trust | K2LU | 0.7 | 0.6 | 0.4 | -6.6 | 1.0 | 9.1 |
| Cambridge Industrial Trust | J91U | 0.7 | 2.8 | 9.3 | -0.9 | 0.8 | 7.2 |
| Viva Industrial Trust | T8B | 0.7 | 0.0 | 18.6 | 27.3 | 0.9 | 9.6 |
| Soilbuild Business Space REIT | SV3U | 0.7 | 3.9 | -2.6 | 12.3 | 0.9 | 8.4 |
| EC World REIT | BWCU | 0.6 | -6.6 | N/A | N/A | N/A | N/A |
| IREIT Global | UD1U | 0.4 | 2.1 | 18.7 | N/A | 1.2 | 8.7 |
| BHG Retail REIT | BMGU | 0.3 | -0.8 | -15.5 | N/A | 0.8 | N/A |
| Sabana Shariah Comp Ind REIT | M1GU | 0.3 | -7.9 | -37.4 | -52.1 | 0.5 | 12.2 |
| Saizen REIT | T8JU | 0.0 | 0.0 | 43.1 | 91.9 | 1.5 | N/A |
| Average | 2.1 | 13.2 | 24.9 | 1.0 | 7.1 |
Source: SGX, Bloomberg & SGX StockFacts (data as of 11 January 2017)
Singapore REITs raise capital to purchase primarily real estate assets, usually with a view to generating income for unit holders of the fund. It allows individual investors to access real property assets and share the benefits and risks of owning a portfolio of local and/or international properties, which typically distribute income at regular intervals.
