Singapore Reits chalk up average total return of 17.6% year-to-date
Singapore
THE average total return of all 31 of Singapore's real estate investment trusts (Reits) with property assets in addition to the six stapled trusts was 17.6 per cent for the year to Aug 4.
The Singapore Exchange (SGX) My Gateway report on Monday said total returns ranged from 8 per cent for Fortune Reit to 30 per cent for CDL Hospitality Trusts.
Ascendas Reit, the largest capitalised of the Reits listed in Singapore, said in its recent quarterly reporting that the United States Federal Reserve remained dovish in its recent announcement in view of weakening US inflation data.
The Reit further noted that interest rates were not projected to rise as fast as expected and this could mean a lower impact on its distribution per unit (DPU).
Institutions were net buyers of the GICS Reit Industry for the past four consecutive months, with cumulative inflows totalling S$133.6 million, said the report.
Over the first 31 weeks of 2017, the SGX Reit 20 Index generated an 18.8 per cent total return, compared to 16 per cent for the same year-ago period.
The 2017 year-to-date return was achieved with less volatility than observed for the same period last year. As at Aug 4, the 20 constituents of the SGX Reit 20 Index had averaged 180 day historical volatility of 13.9 per cent, compared with 18.9 per cent for the same period last year.
SGX currently lists two Reit Exchange Traded Funds (ETFs) - the Phillip SGX APAC Dividend Leaders Reit ETF and NikkoAM-StraitsTrading Asia ex Japan Reit ETF. They were listed on SGX in October 2016 and March 2017 respectively. Both ETFs are tracking indices focused on Reits based in the Asia-Pacific region.
From their launch to Aug 4, the Phillip SGX APAC Dividend Leaders Reit ETF has generated a 5.4 per cent total return and the NikkoAM-StraitsTrading Asia ex Japan Reit ETF has generated an 8.7 per cent total return. Both ETFs are non-SIP (non-specified investment products).
Reits are securities that invest in a diversified pool of professionally managed real estate assets. They were established in Singapore in 2002 and now make up one-tenth of the 30 STI constituents and three of the five Straits Times Index (STI) reserve stocks.
