S'pore Reit managers advised to consider buying back units

Singapore

THE time has come for real estate investment trust (Reit) managers here to seriously consider buying back some of their issued shares given the sector's depressed valuations, Religare Institutional Research suggested in its recent initiation report on Singapore Reits.

Some Reits are now trading at 20-30 per cent below their book values. Compared to buying properties at high prices and compressed cap rates of 4-5 per cent, Religare sees a stronger case for managers to buy their own shares which are yielding 7-9 per cent, depending on the sector.