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Five best-performing S-Reits average 20% return in Q1: SGX

BOURSE operator Singapore Exchange (SGX) has said that the top five performing Singapore real estate investment trusts (S-Reits) have achieved an average return of 20 per cent in the first quarter of 2019.

The strong showing by S-Reits comes on the back of growing investor interest due to the uncertain outlook of US-China trade talks, and the hunt for higher yields amid volatile global equity markets.

Moreover, the recent US Federal Reserve's dovish stance on interest rates amid slowing global growth has buoyed sentiment in the the real estate sector, SGX added.

The top five Reits by return in the first quarter are: Sasseur Reit (25.0 per cent), CapitaLand Retail China Trust (19.4 per cent), Keppel-KBS US Reit (18.2 per cent), Mapletree Logistics Trust (17.6 per cent) and Mapletree North Asia Commercial Trust (17.6 per cent).

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Together, they averaged a total return of 19.6 per cent in the quarter, while their one-year total returns average 11 per cent.

Meanwhile, the top 20 Reits by performance in the quarter - with a total market capitalisation of over S$60 billion - have averaged a return of 15.7 per cent. This, SGX said, brings the total return for one-year, three-year and five-year periods to 10.6 per cent, 37.9 per cent and 51.7 per cent, respectively.

The 20 trusts also have an average price-to-book ratio of 1.0 and a dividend yield of 6.1 per cent.

Industrial and office Reits account for the majority of the best performers, with the remainder being hospitality and retail Reits, SGX said.

According to SGX data, S-Reits saw net institutional inflows of S$82.7 million in January, S$42.7 million in February and S$114.2 million in March, which brings the sector’s inflows to S$239.6 million for the first quarter of 2019. S-Reits was also the top net buy sector in January.

There are 34 Reits, five stapled trusts and three property trusts listed on SGX. The sector has a combined market capitalisation of nearly S$100 billion, with retail, industrial and office Reits making up the largest segments.