For the first 12 weeks of 2023 the iEdge S-REIT Index generated a 3% total return, with the FTSE EPRA/NAREIT Global REITs Index declining 4%. Within the S-REIT Sector, Industrial S-REITs averaged the highest median total returns over the past 12 weeks at 4%, while Office REITs booked the highest median decline in total return at -8%.
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The recent earnings season saw Industrial S-REITs record positive rental reversions, while broadly acknowledging macro headwinds such as rising energy prices and interest rates are adding cost pressures to operations. Multiple Industrial S-REITs have employed further cost-saving measures such as hedging borrowings to fixed rates, as well as initiatives to reduce overall utility consumption.
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With a combined market value of S$99 billion, the S-REIT Sector has booked more than S$200 million of institutional outflow over the past 12 weeks. The 27 trusts of the Sector that booked net institutional outflow over the past 12 weeks represent 52% of the combined S-REIT Sector market value. The 27 trusts have averaged 6% declines in total return over the 12 weeks, while maintaining a median P/B ratio of 0.70x as of 28 Feb.
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As many as 13 of the S-REITs booked net institutional inflows over the past 12 weeks, which represent 48% of the combined S-REIT Sector market value. The 13 REITs averaged a 5% total return over the 12 weeks and a median P/B of 0.97x as of 28 Feb. The trio of REITs that booked the highest net institutional inflows proportionate to respective current market value over the period are CapitaLand China Trust, Keppel DC REIT and Paragon REIT.
Singapore’s S-REIT Sector comprises 40 trusts listed for trading that maintain a combined market value of close to S$100 billion, which is 12% of the total market capitalisation of the Singapore stock market. These trusts are comprised of REITs, Stapled Trusts and Business Trusts, that together have made up 20% of the day-to-day trading turnover of the Singapore stock market in 2023-to-date.
The global benchmark, FTSE EPRA/NAREIT Global REITs Index has declined 4% over the past 12 weeks, following a 24% decline in total return in 2022. This has coincided with the US Federal Reserve hiking the Fed Fund Rate by 475bps and the ECB hiking its three policy rates by 350 bps. Since the end of 2019, the FTSE EPRA/NAREIT Global REITs Index through to 24 March has declined 13%, while the iEdge S-REIT Index has declined 6%.
For the first 12 weeks of 2023, the iEdge S-REIT Index generated a 3% total return, with the majority of the 3% total return attributed to dividend distributions.
One-third of S-REIT Sector with Almost Half of Sector Market Cap Draws Net Institutional inflows in 2023-to-date.
The S-REIT Sector booked S$205 million of net institutional outflow over the past 12 weeks, following on from net institutional outflow in the vicinity of S$1 billion in 2022. For 2023 through to 24 March, approximately two-thirds of the trusts of the S-REIT Sector booked net institutional outflows, while one-third booked net institutional inflows.
However, in terms of overall market value, the one-third of the S-REIT Sector that booked net institutional inflows for the past 12 weeks, on average maintained higher market capitalisation. Thus, as much as 48% of the combined market value of the S-REIT Sector booked net institutional inflows over the past 12 weeks. These 13 S-REITs, with a combined market capitalisation of S$46.8 billion, are tabled below (in order of market capitalisation). The 13 S-REITs averaged 5.2% total returns over the past 12 weeks.
| S-REITs that booked Net Institutional Inflows over Past 12 weeks |
SGX Code |
Market Cap S$M |
YTD Total Return (%) |
YTD Institutional Net Flow S$M |
YTD Institutional Net Flow / Market Cap |
Type of Property | Dividend Yield as of 28-Feb (%) |
Debt/Asset As Of 28-Feb (%) |
P/B As Of 28-Feb (x) |
|---|---|---|---|---|---|---|---|---|---|
| Mapletree Pan Asia Commercial Trust | N2IU | $9,274 | 7.4 | 2.84 | 0.03% | Diversified | 5.9 | 40.2 | 0.95 |
| Mapletree Logistics Trust | M44U | $8,187 | 8.3 | 12.53 | 0.15% | Industrial | 5.3 | 37.4 | 1.20 |
| Mapletree Industrial Trust | ME8U | $6,410 | 6.9 | 1.29 | 0.02% | Industrial | 5.8 | 37.2 | 1.24 |
| Frasers Logistics & Commercial Trust | BUOU | $4,833 | 12.1 | 8.87 | 0.18% | Diversified | 6.0 | 27.9 | 0.97 |
| Frasers Centrepoint Trust | J69U | $3,807 | 6.2 | 9.25 | 0.24% | Retail | 5.4 | 33.9 | 0.97 |
| Keppel DC REIT | AJBU | $3,457 | 16.4 | 28.11 | 0.81% | Specialised | 5.2 | 36.4 | 1.41 |
| Paragon REIT | SK6U | $2,618 | 4.6 | 15.97 | 0.61% | Retail | 5.6 | 29.8 | 1.00 |
| Parkway Life REIT | C2PU | $2,335 | 4.5 | 1.10 | 0.05% | Healthcare | 3.3 | 36.4 | 1.81 |
| CapitaLand China Trustr | AU8U | $1,858 | 1.9 | 29.34 | 1.58% | Diversified | 6.5 | 39.6 | 0.84 |
| OUE Commercial REIT | TS0U | $1,723 | -3.2 | 0.48 | 0.03% | Diversified | 6.1 | 38.8 | 0.59 |
| Starhill Global REIT | P40U | $1,149 | -2.6 | 0.39 | 0.03% | Retail | 6.9 | 36.3 | 0.69 |
| AIMS APAC REIT | O5RU | $929 | 6.0 | 3.66 | 0.39% | Industrial | 7.0 | 36.4 | 0.99 |
| BHG Retail REIT | BMGU | $254 | -1.2 | 0.02 | 0.01% | Retail | 2.4 | 37.7 | 0.60 |
# Denotes Stapled Trusts,
* Denotes Business Trusts
Source: SGX, Refinitiv, Bloomberg, Data as of 24 March 2023
The trio of REITs that booked the highest net institutional inflows proportionate to respective current market value over the period are CapitaLand China Trust, Keppel DC REIT and Paragon REIT.
The 27 trusts of the Sector that booked net institutional outflow over the past 12 weeks represent 52% of the combined S-REIT Sector market value with a combined market capitalisation of S$51.7 billion. These 27 trusts averaged 6.0% declines in total return over the past 12 weeks, with CapitaLand Integrated Commercial Trust, Suntec REIT and Keppel REIT booking the highest net institutional outflows and Suntec REIT also booking the highest net outflows proportionate to its current market value for the period. The 27 trusts also maintained a median P/B ratio of 0.70x as of 28 Feb, compared to 0.97x for the aforementioned 13 trusts which booked net institutional inflow for the 12 weeks.
Industrial REITs Booked Highest Median Total Returns in 2023-to-date.
Within the S-REIT Sector, Industrial S-REITs averaged the highest median total returns over the past 12 weeks at 3.7%, while Office REITs booked the highest median decline in total return at -8.0%. As discussed here the recent earnings season saw Industrial S-REITs record positive rental reversions, while broadly acknowledging macro headwinds such as rising energy prices and interest rates are adding cost pressures to operations. Multiple Industrial S-REITs employ further cost-saving measures such as hedging borrowings to fixed rates, as well as initiatives to reduce overall utility consumption.
Gearing Ratios Varied from 27.6% to 48.8% as of 28 Feb.
The 13 S-REITs that booked net institutional inflows over the past 12 weeks maintained a slightly lower median gearing ratio of 36.4%, versus 38.5% for the 27 trusts of the Sector that booked net institutional outflows. The average gearing ratio of the S-REIT Sector was 37.7% as of 28 Feb.
Performance-wise, the trusts with a below-average gearing ratio generated median gains of 3.4% compared to the trusts with an above average gearing ratio which generated declines of 3.2% in total return over the 12 weeks. As discussed here, the average gearing ratio is below the regulatory limit of 50%, with the limit based on a REIT maintaining a minimum interest coverage ratio (ICR) of at least 2.5 times. If the ICR is below 2.5 times, the maximum allowable limit is at 45%. This limit was last increased in April 2020, to provide the sector with more flexibility to manage their capital structure during the pandemic. Based on recent filings, the average ICR for the S-REIT Sector is around 4.7 times.
According to the MAS Code on Collective Investment Schemes (latest revised Mar 9, 2023) on its website for property funds, the aggregate leverage limit is not considered to be breached if due to circumstances beyond the control of the manager such as a depreciation in the asset value of the property fund or any redemption of units or payments made from the property fund – if the aggregate leverage limit is exceeded as a result of these examples, the manager should not incur additional borrowings or enter into further deferred payment arrangements.
The 40 trusts of the S-REIT Sector that are listed for trading are tabled below and sort by market capitalisation.
| S-REITs | SGX Code |
Market Cap S$M |
YTD Total Return (%) |
YTD Institutional Net Flow S$M |
MTD Institutional Net Flow S$M |
2022 Total Return (%) |
Type of Property | Dividend Yield As Of 28-Feb (%) |
Debt/Asset As Of 28-Feb (%) |
P/B As Of 28-Feb (x) |
|---|---|---|---|---|---|---|---|---|---|---|
| CapitaLand Integrated Commercial Trust | C38U | $12,765 | -3.4 | -91.08 | -21.42 | 2.6 | Diversified | 5.5 | 40.4 | 0.9 |
| CapitaLand Ascendas REIT | A17U | $11,645 | 3.9 | -15.05 | -14.95 | -2.0 | Industrial | 5.7 | 36.3 | 1.2 |
| Mapletree Logistics Trust | M44U | $8,187 | 8.3 | 12.53 | -1.58 | -12.5 | Industrial | 5.3 | 37.4 | 1.2 |
| Mapletree Pan Asia Commercial Trust | N2IU | $9,274 | 7.4 | 2.84 | 2.32 | -11.7 | Diversified | 5.9 | 40.2 | 0.9 |
| Frasers Logistics & Commercial Trust | BUOU | $4,833 | 12.1 | 8.87 | -2.64 | -19.0 | Diversified | 6.0 | 27.9 | 1.0 |
| Keppel DC REIT | AJBU | $3,457 | 16.4 | 28.11 | 13.88 | -25.3 | Specialised | 5.2 | 36.4 | 1.4 |
| Mapletree Industrial Trust | ME8U | $6,410 | 6.9 | 1.29 | -14.72 | -13.4 | Industrial | 5.8 | 37.2 | 1.2 |
| Suntec REIT | T82U | $4,099 | 4.4 | -84.80 | -52.56 | -3.1 | Diversified | 6.3 | 43.7 | 0.7 |
| Keppel REIT | K71U | $3,249 | -2.1 | -25.69 | -20.71 | -15.1 | Office | 6.4 | 38.4 | 0.7 |
| Lendlease REIT | JYEU | $1,563 | -0.2 | -25.15 | -7.98 | -13.9 | Diversified | 6.9 | 39.2 | 0.7 |
| CapitaLand Ascott Trust # | HMN | $3,439 | -3.3 | -1.15 | -4.84 | 6.7 | Hospitality | 5.6 | 38.0 | 0.9 |
| Frasers Centrepoint Trust | J69U | $3,807 | 6.2 | 9.25 | 4.46 | -4.0 | Retail | 5.4 | 33.9 | 1.0 |
| ESR-LOGOS REIT | J91U | $2,335 | -7.2 | -6.86 | -3.69 | -18.8 | Industrial | 8.8 | 41.8 | 0.9 |
| CapitaLand China Trust | AU8U | $1,858 | 1.9 | 29.34 | 1.93 | -1.1 | Diversified | 6.5 | 39.6 | 0.8 |
| CapitaLand India Trust * | CY6U | $1,235 | -2.9 | -12.93 | -5.66 | -15.1 | Diversified | 7.3 | 37.0 | 1.0 |
| CDL Hospitality Trusts # | J85 | $1,436 | -4.7 | -0.24 | -5.50 | 11.3 | Hospitality | 4.4 | 36.6 | 0.9 |
| Parkway Life REIT | C2PU | $2,335 | 4.5 | 1.10 | -2.92 | -25.1 | Healthcare | 3.3 | 36.4 | 1.8 |
| Manulife US REIT | BTOU | $592 | -10.8 | -7.04 | -1.24 | -53.2 | Office | 18.4 | 48.8 | 0.5 |
| Digital Core REIT | DCRU | $606 | -24.4 | -9.05 | -8.68 | -51.6 | Specialised | 6.5 | 34.0 | 0.7 |
| Paragon REIT | SK6U | $2,618 | 4.6 | 15.97 | -1.01 | -4.5 | Retail | 5.6 | 29.8 | 1.0 |
| AIMS APAC REIT | O5RU | $929 | 6.0 | 3.66 | -2.56 | -8.3 | Industrial | 7.0 | 36.4 | 1.0 |
| Prime US REIT | OXMU | $528 | -12.2 | -10.43 | -4.16 | -47.1 | Office | 16.4 | 42.1 | 0.5 |
| Sasseur REIT | CRPU | $913 | -0.3 | -3.93 | -1.90 | -2.2 | Retail | 8.6 | 27.6 | 0.8 |
| Far East Hospitality Trust # | Q5T | $1,175 | -2.3 | -0.09 | -0.84 | 10.4 | Hospitality | 5.2 | 32.0 | 0.6 |
| Starhill Global REIT | P40U | $1,149 | -2.6 | 0.39 | -1.64 | -12.2 | Retail | 6.9 | 36.3 | 0.7 |
| Cromwell REIT | CWBU | $1,258 | 9.2 | -3.15 | 0.38 | -40.2 | Diversified | 10.2 | 39.4 | 0.7 |
| Keppel Pacific Oak US REIT | CMOU | $563 | -7.9 | -5.73 | -1.20 | -38.3 | Office | 13.0 | 38.2 | 0.5 |
| Sabana REIT | M1GU | $477 | 3.4 | -1.18 | -1.26 | 4.9 | Industrial | 7.1 | 32.4 | 0.8 |
| OUE Commercial REIT | TS0U | $1,723 | -3.2 | 0.48 | -1.07 | -19.2 | Diversified | 6.1 | 38.8 | 0.6 |
| Frasers Hospitality Trust # | ACV | $876 | 2.2 | -0.90 | -0.11 | -1.2 | Hospitality | 3.5 | 35.2 | 0.7 |
| First REIT | AW9U | $526 | 0.5 | -2.34 | -0.94 | -6.4 | Healthcare | 10.2 | 38.5 | 0.8 |
| Daiwa House Logistics Trust | DHLU | $395 | -6.4 | -5.20 | -2.09 | -17.3 | Industrial | 8.9 | 35.9 | 0.8 |
| United Hampshire US REIT | ODBU | $371 | 11.1 | -2.12 | -0.45 | -25.6 | Retail | 11.3 | 41.8 | 0.7 |
| IREIT Global SGD | UD1U | $572 | 1.6 | -1.45 | -0.91 | -16.9 | Office | 5.2 | 32.0 | 0.7 |
| EC World REIT | BWCU | $255 | -27.7 | -1.70 | -0.43 | -36.1 | Industrial | 11.6 | 38.8 | 0.5 |
| Lippo Malls Indonesia Retail Trust | D5IU | $123 | -45.8 | -0.94 | -0.08 | -39.6 | Retail | 10.3 | 44.6 | 0.3 |
| Elite Commercial REIT | MXNU | $321 | -8.2 | -0.24 | -0.04 | -31.6 | Office | 10.3 | 45.8 | 0.9 |
| ARA US Hospitality Trust # | XZL | $277 | 6.7 | -0.26 | 0.07 | -27.8 | Hospitality | 7.6 | 39.4 | 0.5 |
| Dasin Retail Trust * | CEDU | $147 | -35.8 | -0.17 | -0.03 | -17.5 | Retail | 10.2 | 40.4 | 0.2 |
| BHG Retail REIT | BMGU | $254 | -1.2 | 0.02 | 0.02 | -15.2 | Retail | 2.4 | 37.7 | 0.6 |
| Average | -2.4 | -16.4 | 7.6 | 37.7 | 0.8 | |||||
| Total | $98,577 | -$205 | -$167 |
# Denotes Stapled Trusts
* Denotes Business Trusts
Source: SGX, Refinitiv, Bloomberg, Data as of 24 March 2023
Note: SGX lists for trading five ETFs that track REIT Indices. These include the Phillip SGX APAC DIV REIT ETF, UOB APAC Green REIT ETF, NikkoAM-StraitsTrading Asia ex Japan REIT ETF, Lion-Phillip S-REIT ETF and CSOP iEdge SREIT Leaders Index ETF. The five ETFs have averaged a marginal total return of 0.5% over the past 12 weeks and average a trailing 12-month dividend yield of 4.8%.
