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The Best Yields You Can Find Among Singapore’s Largest And Most Tradable Real Estate Stocks

Singapore is the home to a number of large real estate-related stocks. The SGX Real Estate 20 Index could be a good place to start learning about these stocks. The index is home to 20 of the largest and most tradable real estate companies and real estate investments trusts (REITs) in the Singapore market.

A recent report by bourse operator Singapore Exchange Limited (SGX: S68) provided insight on the dividend yields on offer among the constituents of the SGX Real Estate 20 Index.

Here are the five companies and/or REITs with the five highest dividend yields (figures as of 9 January 2017 unless otherwise stated):

  1. Mapletree Greater China Commercial Trust  (SGX: RW0U) comes out tops with a distribution yield of 7.5%. In its last reporting quarter, Mapletree Greater China Commercial Trust’s revenue and net property income (NPI) slipped by 1.9% and 3.2% respectively. The commercial-property-focused REIT also cut its distribution per unit by 2.4% year-on-year. Mapletree Greater China Commercial Trust has a market cap of $2.9 billion.
  2. Tied for the top spot is CapitaLand Retail China Trust (SGX: AU8U) with the same distribution yield. CapitaLand Retail China Trust recorded declines of 8.5% and 6.9% for its revenue and NPI in its latest quarter. Consequently, its DPU was reduced by 10.6% year-on-year. The REIT, which has a portfolio comprising retail malls in China, has a market cap of $1.7 billion.
  3. Mapletree Logistics Trust (SGX: M44U) drops in at third place with its trailing distribution yield of 7.2%. In its latest quarter, the owner of logistics properties in eight different geographic markets recorded 4.7% growth in revenue. Its NPI also came in 5.3% higher. However, the REIT’s outlook remains challenging and its DPU was unchanged. Mapletree Logistics Trust has a market cap of $2.7 billion.
  4. Another Mapletree entity, Mapletree Industrial Trust (SGX: ME8U), is in fourth place with a distribution yield of 6.9%. Mapletree Industrial Trust has a market cap of $3.5 billion. The industrial-based REIT recorded a 1.8% year-on-year bump in revenue and a 4.3% increase in NPI in its latest quarter. Its DPU was also up by 1.4%. The REIT owns many different types of industrial properties in Singapore.
  5. The fifth highest yield comes from Starhill Global Real Estate Investment Trust (SGX: P40U). Starhill Global REIT has a market cap of $1.9 billion. The retail REIT recorded a 2.7% and 1.7% decline in revenue and NPI, respectively, in its latest quarter. The REIT’s DPU was also down slightly by 0.8%.

There is usually a good reason why real estate companies or REITs are offering higher yields. Each of the five REITs listed above are facing their own unique challenges and most of them have also reduced their distributions recently.

As investors, it is our duty to find out whether the business challenges confronting any particular stock are surmountable and if so, how long the issues will take to be resolved.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. The Motley Fool Singapore has recommended shares of Singapore Exchange. Motley Fool Singapore contributor Chin Hui Leong owns units in Mapletree Logistics Trust.