Singapore is the home to many real estate stocks. The SGX Real Estate 20 Index could be a good place to start learning about some of them. The index is home to 20 of the largest and most tradable real estate companies and real estate investment 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. For the companies and/or REITs with the five highest yields, head here. For the next five, let’s check out below (figures as…
Singapore is the home to many real estate stocks. The SGX Real Estate 20 Index could be a good place to start learning about some of them. The index is home to 20 of the largest and most tradable real estate companies and real estate investment trusts (REITs) in the Singapore market.
For the companies and/or REITs with the five highest yields, head here. For the next five, let’s check out below (figures as of 9 January 2017 unless otherwise stated):
- CDL Hospitality Trusts (SGX: J85), which owns and manages hotels and resorts, comes in at sixth place with a distribution yield of 6.4%. The trust is a stapled security that comprises a real estate investment trust and business trust. In its latest quarter, CDL Hospitality Trusts’ revenue and net property income (NPI) was up by 10.5% and 5.3% respectively. The trust also raised its distribution per stapled security by 3.4%. CDL Hospitality Trusts has a market cap of $1.6 billion.
- Tied for sixth place is Ascendas Real Estate Investment Trust (SGX: A17U) with the same distribution yield. Ascendas REIT recorded 12.5% growth in revenue and an even stronger 23.1% increase in NPI in its latest quarter. But, its distribution per unit (DPU) was reduced by 3.1% year on year. Ascendas REIT has a market cap of $9.3 billion and is Singapore’s first and largest listed business space and industrial REIT.
- Next up is Keppel REIT (SGX: K17U) with a trailing DPU yield of 6.1%. In its latest quarter, the owner of commercial properties in Singapore and Australia recorded a 6.3% decline in revenue. Its NPI and DPU also stepped down by 5.4% and 5.9%, respectively. Keppel REIT has a market cap of $3.3 billion.
- Suntec Real Estate Investment Trust (SGX: T82U) is tied with Keppel REIT with its DPU yield of 6.1% as well. Suntec REIT has a market cap of $6.4 billion. The REIT owns commercial and retail properties in both Singapore and Australia. It recorded a 4.3% year-on-year decline in revenue and a 2.1% decrease in NPI in its latest quarter. Its DPU, though, was up by 0.5%.
- Rounding up the top 10 is Frasers Centrepoint Trust (SGX: J69U). The REIT has a market cap of $1.9 billion. The trust, which owns retail malls in Singapore, recorded a 6% decline in sales and 0.9% decline in NPI in its latest quarter. The REIT’s DPU was also down by 1.5% year-on-year.
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 Suntec REIT and Frasers Centrepoint Trust.