SGX Market Updates

Trading Surges for 4 REITs in the STI Reserve List


PUBLISHED ON |

13 March 2019

  • The STI Reserve List is comprised of Mapletree Commercial Trust, Suntec REIT, Mapletree Logistics Trust, Keppel REIT and Mapletree North Asia Commercial Trust. Together, the five REITs have averaged a 13.4% total return in 2019 YTD.

  • In 2019 YTD, trading volumes for 4 of the five REITs, Mapletree Commercial Trust, Mapletree Logistics Trust, Keppel REIT and Mapletree North Asia Commercial Trust, have surged 40% compared to their combined trading volumes in 2018.

  • Coinciding with higher unit prices & trading volumes, the four REITs saw their combined average daily turnover surge 51% to S$48.2 million in 2019 YTD, from S$31.8 million in 2018. These REITs were recipient of a combined S$50 million in institutional net inflow in first 10 weeks of 2019




While the Straits Times Index (“STI”) includes 3 Real Estate Investment Trusts (“REITs”), the STI Reserve List is currently wholly comprised of REITs. The 5 REITs are Mapletree Commercial Trust (MCT), Suntec REIT, Mapletree Logistics Trust (MLT), Keppel REIT and Mapletree North Asia Commercial Trust (MNACT).

REITs have been listed on Singapore Exchange since 2002 and in the last five trading sessions alone accounted for 14 of the top 50 stocks by turnover or traded value.



Turnover and Volume Surges

4 of the 5 REITs that make up the STI Reserve List – Mapletree Commercial Trust, Mapletree Logistics Trust, Keppel REIT and Mapletree North Asia Commercial Trust have seen trading activity surge in the 2019 year-to-date. The combined average daily volume traded in 2019 through to 12 March for the four REITs has been 40% higher than the respective daily volumes for the full 2018 calendar year. Likewise, average daily turnover or daily traded values for the four REITS combined has also surged, and combined has been 51% higher than the respective 2018 levels.

Trading and Volume Growth

These 4 REITs saw their combined average daily turnover surge to S$48.2 million in the 2019 year-to-date from S$31.8 million in 2018.

For the five sessions through to 12 March, MCT and MLT ranked #19 and #20 by average daily turnover for all of the stocks listed on SGX.  Meanwhile, Keppel REIT and MNACT ranked #27 and #32, while Suntec REIT, not illustrated above ranked #30.

The 4 REITs have also performed similarly in the 2019 year through to 12 March, averaging 13.7% total returns. Suntec REIT, which makes up the fifth REIT of the STI Reserve List averaged a 12.2% total return in the 2019 year through to 12 March. The four REITs have been recipient of S$50 million in institutional net inflow in the 2019 year to 8 March.


4 of 5 REITs in STI Reserve List
with Strong Volume Growth
in 2019 YTD
SGX
Code
Market
Cap
S$Bn
Total
Return
2016
%
Total
Return
2017
%
Total
Return
2018
%
Total
Return
YTD
%
Latest
Fin
Results
Div
Yld
(%)
Mapletree Commercial Trust N2IU 5.2 14.9 23.0 7.6 11.2 Link 5.0
Mapletree Logistics Trust M44U 5.2 10.8 38.7 1.5 15.2 Link 5.5
Keppel REIT K71U 4.4 17.0 30.1 -5.2 13.6 Link 4.3
Mapletree North Asia Commercial Trust RW0U 4.1 11.7 38.3 -1.1 14.9 Link 7.4
Average:     13.6 32.5 0.7 13.7   5.6

Source: SGX My Gateway, Bloomberg, Thomson Reuters (Data as of 12 March 2019)



The four REITs were recipient of a combined S$50 million in institutional net inflow in first 10 weeks of 2019, led by net inflow of S$21 million for Keppel REIT.



The 4 REITs Recently Reported FY or FY-to-date DPU Growth

These REITs also recently reported financial results, and grew in every instance distribution per unit (“DPU”) for either their financial year-to-date, or the complete FY:

  • Mapletree Commercial Trust (MCT)’s 9MFY18/19 gross revenue (ending 31 Dec 2018) gained 2.0% YoY, with its DPU up 0.9%.  MCT’s portfolio comprises VivoCity, MBC I, PSA Building, Mapletree Anson and MLHF. These five assets have a total value of S$6.7 billion.

  • Mapletree Logistics Trust (MLT)’s 9MFY18/19 gross revenue (ending 31 Dec 2018) gained 15.7% YoY, with its distribution per unit (“DPU”) up 4.2%. As at 31 Dec 2018, MLT’s portfolio comprised 140 properties with a total AUM value of S$7.8 billion.

  • At S$165.9 million, Keppel REIT’s property income for FY18 (ending 31 Dec 2018) grew modestly above its FY17 property income of S$164.5 million, with the distribution per unit (“DPU”) up 2.5%. As of 31 Dec, Keppel REIT had AUM of over S$8 billion in Singapore as well as key Australian cities.
  • Mapletree North Asia Commercial Trust (MNACT)’s 9MFY18/19 gross revenue (ending 31 Dec 2018) gained 14.8% YoY, with its DPU up 2.7%. MNACT’s portfolio consists of nine properties in China, Hong Kong SAR and Japan with a total book value of S$7.2 billion as of 31 Dec 2018.

For the quarter, MCT, MLT and MNACT reported DPU growth for 3QFY18/19 from 3QFY17/18.



STI Reserve List

The STI Reserve List is used in the event that one or more of the STI constituents are deleted during the period up to the next quarterly review. As detailed in the STI Ground Rules, when a company is going to be removed from the STI, the vacancy will be filled by selecting the highest ranking security by full market value in the Reserve List as at the close of the index calculation two days prior to the deletion.

There are further qualifications for the framework of the STI Reserve List in the case as Mergers, Restructuring and Complex Takeovers as described in Section 6.4 of the STI Ground rules.







This article is provided by SGX My Gateway.



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