SGX Market Updates

Recent S-REIT Performances, Yields & DPU Growth


PUBLISHED ON |

10 May 2021

  • Globally, Hotel REITs, Retail REITs & Office REITs have led REIT Sectors in the 2021 year-to-date, after posting the most declines in 2020. Data Centres, which led in 2020, are the least performer in the 2021 year-to-date. Global Industrial REITs and regional Healthcare REITs, less negatively impacted by the K-shaped economics of the past year, were more consistent performers.

  • S-REITs averaged 7% gains in the 2021 year-to-date, bringing their 12-month average gain to 18%, in-line with median total return of all APAC-listed REITs at 17%. S-REITs average a 5.6% dividend yield, with as many as nine of the S-REITs maintaining yields at 7% or above, while also generating double-digit percentage returns over the past 12 months.

  • During this earnings season to date, 17 S-REITs have averaged DPU growth of 25%, with SPH REIT, Mapletree Commercial Trust, AIMS APAC REIT, ARA LOGOS Logistics Trust and Frasers Centrepoint Trust, among the S-REITs posting the highest y-o-y DPU growth.

  • S-REITs expected to report or provide business updates this week include Manulife US REIT, EC World REIT, Cromwell European REIT, United Hampshire REIT and Sasseur REIT.




S-REITs have averaged 7% gains in the 2021 year-to-date bringing their 12 month average gain to 18%, largely in-line with the median total return of all APAC-listed REITS at 5% in the 2021 year-to-date, and 17% over the past 12 months. The global REIT Sector, which is fast approaching a combined market capitalisation of S$3 trillion has generated a 9% median gain in the 2021 year-to-date.

As of the end of April 2021, S-REITs averaged a 5.6% dividend yield. As many as 9 S-REITs have generated double-digit percentage returns over the past 12 months and maintained dividend yields above 7.0% as of the end of April. These 9 S-REITs are tabled below.


S-REITs with 12-month Double-Digit
Gains & Yields above 7%
SGX
Code
Market
Cap
S$M
QTD
Total
Return
%
YTD
Total
Return
%
12-Month
Total
Return
%
Sector Dividend
Yield
%
KEPPEL PACIFIC OAK US REIT CMOU 922 1 12 22 Office 8.4
ELITE COMMERCIAL REIT MXNU 580 -1 9 13 Office 8.0
ARA LOGOS LOGISTICS TRUST K2LU 1129 9 34 63 Industrial 7.5
ESR-REIT J91U 1401 2 3 19 Industrial 7.5
IREIT GLOBAL UD1U 606 1 3 13 Office 7.4
CROMWELL EUROPEAN REIT OFKU/QTRU 2146 7 4 38 Diversified 7.3
EC WORLD REIT BWCU 589 2 4 21 Industrial 7.3
SASSEUR REIT CRPU 1119 4 15 37 Retail 7.1
UNITED HAMPSHIRE US REIT ODBU 455 2 10 16 Retail 7.0

Source: S-REITs & Property Trust Chartbook, Refinitiv and Bloomberg (Performance data as 7 May 2021, Dividend yield, P/B as of 31 April 2021)



Global REIT Sub-Trend

A key driver for Global REIT performances in 2020 and the 2021 year-to-date has been the type of properties that make up a REIT portfolio. Across the globe, social and economic lockdowns, social distancing and safe workplace practices weighed the Hospitality REITs, Retail Reits and Office REITs in 2020, while demand for technology-driven solutions saw Data Centres outpace. With imminent vaccine rollouts confirmed in early November, 2021 has so far seen 1.3 billion vaccine doses administered. This has seen the 2020 laggards - Hospitality REITs, Retail REITs and Office REITs – lead the global REIT market in the 2021 year-to-date, whilst last year’s Data Centre outperformers have so far ranked as 2021’s laggards.

However, virus resurgences, mutation strains, and unhurried return to international travels, means that the REIT subsector moves in the 2021 year-to-date have been somewhat measured or tentative. While global Hospitality REITs generated a median decline of 30% in 2020, the recovery in the 2021 year-to-date year has been partial, with a 13% gain. Likewise, the 17% median return of global Data Centres in 2020 hasn’t been erased, rather trimmed, by a median 1% decline in the 2021 year-to-date. Hence, while investors may have rotated among the REIT subsectors, subsector performances have not seen full turnarounds.

Globally, Industrial REITs have posted median gains in both 2020 and the 2021 year-to-date, with warehouse, business parks and logistic efficiency supported by the e-commerce, technology and consumer goods industries. Industrial REITs can play important roles in international and manufacturing supply chains, which have been comparatively resilient over the past 12 months, supported by Asia being home to two-thirds of world’s industrial robots. Across the region, Healthcare REITs were the more resilient REIT type, when comparing performances of the 2021 year-to-date with 2020.

While these key subtrends set the stage for unit performances over the past 12 months, the table above does reflect a balance in terms of the type of properties that make up the nine S-REIT portfolios, double-digit percentage gains for those 12 months and yields at or above 7.0%.

5 S-REITs With The Strongest Year-On-Year DPU Growth in Current Earnings Season-To-Date

During this earnings season to date, 17 S-REITs have averaged DPU growth of 25%. SPH REIT, Mapletree Commercial Trust, AIMS APAC REIT, ARA LOGOS Logistics Trust and Frasers Centrepoint Trust, were among the S-REITs posting the highest y-o-y DPU growth.

  • SPH REIT declared a DPU of S$0.0124 for its 2QFY21 (ended 28 Feb), representing an increase of 3.3% quarter-on-quarter (QoQ) and 313.3% y-o-y. Against the backdrop of global vaccination drives and a gradual recovery in tenants’ sales, SPH REIT’s near-term focus is to maintain healthy occupancy and sustainable rental income in partnership with tenants. SPH REIT’s portfolio occupancy rate stands at 98.0% as at 28 Feb 2021, compared to 98.9% a year ago.

  • Mapletree Commercial Trust declared a DPU of S$0.0532 for 2HFY20/21 (ended 31 Mar), up 57.9% y-o-y. The latest declared DPU includes the release of S$13.0 million from the retained cash carried forward from its 4QFY19/20. Management noted that monthly tenant sales in 4QFY20/21 have recovered to more than 86% of pre-COVID levels, in tandem with the phased easing for COVID-19 protocols.

  • AIMS APAC REIT declared a DPU of S$0.029 for 4QFY21 (ended 31 Mar), a 45% increase from 4QFY20. Management noted a limited impact on landlord’s rental relief (1.4% of FY21 gross revenue) demonstrating resilience of the tenant base, which allowed for the full release of the balance S$1.1 million previously retained in 4QFY20. Management also noted that the portfolio committed occupancy was maintained at 95.4%, above the industry average of 90.0%.

  • ARA LOGOS Logistics Trust published its business update for 1Q21 (ended 31 Mar) and declared a DPU of S$0.01353, representing a 35.7% increment y-o-y. Management noted that growth has been underpinned by stronger portfolio performance due to the commencement of new leases at several properties as well as higher revenue generated from the Australia portfolio on the back of the strengthening Australian dollar, and the portfolio committed occupancy rose to 99.1%.

  • Frasers Centrepoint Trust declared 1HFY21 (ended 31 Mar) DPU of S$0.05996 which is 28.4% higher y-o-y. This marks the first set of financial results following the acquisition of the remaining 63.11% stake in AsiaRetail Fund Limited in October 2020. FCT noted that overall performance was boosted by the enlarged retail portfolio from the acquisition and its retail portfolio occupancy remained stable at 96.1%. FCT expects the steady roll-out of vaccination programme in Singapore and continued re-opening of the economy to further support the recovery of shopper traffic and tenants’ sales.

S-REITs reporting or providing business updates this week include Manulife US REIT, EC World REIT, Cromwell European REIT, United Hampshire REIT and Sasseur REIT.

The table below is sorts the property trusts of the S-REIT Sector by 12 month performances.

S-REITs & Property Trusts SGX
Code
Market
Cap
S$M
QTD
Total
Return
%
YTD
Total
Return
%
12-Month
Total
Return
%
Sector Debt/Asset
%
P/B
(x)
Dividend
Yield
%
ARA LOGOS LOGISTICS TRUST K2LU 1129 9 34 63 Industrial 37 1.5 7.5
LENDLEASE GLOBAL COMM REIT JYEU 921 -3 10 44 Diversified 35 1.0 5.0
SABANA SHARIAH COMP IND REIT M1GU 442 8 25 41 Industrial 36 0.8 6.6
FRASERS LOGISTICS & COMM TRUST BUOU 5040 1 4 40 Diversified 35 1.3 4.8
CDL HOSPITALITY TRUSTS * J85 1534 1 1 40 Hospitality 39 0.9 4.0
CROMWELL EUROPEAN REIT OFKU/QTRU 2146 7 4 38 Diversified 38 0.9 7.3
SASSEUR REIT CRPU 1119 4 15 37 Retail 28 1.0 7.1
PARKWAYLIFE REIT C2PU 2595 6 13 36 Healthcare 38 2.1 3.4
AIMS APAC REIT O5RU 1011 11 16 33 Industrial 34 0.9 5.8
FAR EAST HOSPITALITY TRUST * Q5T 1201 -3 1 31 Hospitality 42 0.8 3.8
MAPLETREE NORTH ASIA COMM TRUST RW0U 3640 3 13 27 Diversified 42 0.9 5.7
ASCOTT RESIDENCE TRUST * HMN 3304 -1 0 27 Hospitality 36 1.1 2.9
KEPPEL REIT K71U 4442 -1 12 23 Office 35 0.9 4.6
ASCENDAS INDIA TRUST ** CY6U 1612 -5 4 22 Diversified 34 1.3 6.2
KEPPEL PACIFIC OAK US REIT CMOU 922 1 12 22 Office 38 0.9 8.4
PRIME US REIT OXMU 1201 -2 13 22 Office 34 1.0 6.9
FRASERS CENTREPOINT TRUST J69U 4077 0 0 21 Retail 35 1.1 4.3
EC WORLD REIT BWCU 589 2 4 21 Industrial 38 0.8 7.3
CAPITALAND INTEGRATED COMM TRUST C38U 13794 -2 -1 21 Diversified 41 1.1 4.0
STARHILL GLOBAL REIT P40U 1229 -1 14 20 Retail 36 0.7 4.6
ESR-REIT J91U 1401 2 3 19 Industrial 42 1.0 7.5
KEPPEL DC REIT AJBU 4280 -3 -5 18 Specialized 37 2.3 3.6
FRASERS HOSPITALITY TRUST * ACV 1050 3 4 18 Hospitality 38 0.8 2.2
ARA US HOSPITALITY TRUST * XZL 391 -1 18 17 Hospitality 49 0.9 N/A
SUNTEC REIT T82U 4320 -1 5 17 Diversified 44 0.7 5.0
UNITED HAMPSHIRE US REIT ODBU 455 2 10 16 Retail 36 0.9 7.0
MAPLETREE COMM TRUST N2IU 6997 2 2 15 Diversified 34 1.3 4.3
MAPLETREE INDUSTRIAL TRUST ME8U 6513 2 -2 15 Industrial 37 1.7 4.4
SPH REIT SK6U 2406 0 5 14 Retail 30 0.9 3.9
IREIT GLOBAL UD1U 606 1 3 13 Office 35 0.9 7.4
MAPLETREE LOGISTICS TRUST M44U 8481 4 0 13 Industrial 38 1.5 4.2
ELITE COMM REIT MXNU 580 -1 9 13 Office 42 1.0 8.0
ASCENDAS REIT A17U 12672 0 3 8 Industrial 38 1.4 4.7
OUE COMM REIT TS0U 2198 3 9 8 Diversified 40 0.7 6.0
MANULIFE US REIT BTOU 1571 1 4 8 Office 41 1.0 7.4
CAPITALAND CHINA TRUST AU8U 2069 -1 -2 7 Diversified 35 0.9 4.6
DASIN RETAIL TRUST ** CEDU 569 0 -4 -4 Retail 38 0.5 5.4
BHG RETAIL REIT BMGU 287 2 4 -6 Retail 36 0.6 3.5
LIPPO MALLS INDONESIA RETAIL TRUST D5IU 506 1 8 -44 Retail 42 0.7 4.4
FIRST REIT AW9U 426 15 26 -61 Healthcare 49 0.5 16.0
Average 2 7 18 37.8 1.0 5.6
Median 1 4 19 37.5 0.9 5.0

Note: * Stapled Trust, ** Business Trust.
Source: S-REITs & Property Trust Chartbook, Refinitiv and Bloomberg (Performance data as 7 May 2021, Dividend yield, P/B as of 31 April 2021)







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