9 Key Numbers Investors Should Know About Singapore REITs

Real estate investment trusts (REITs) have come a long way in Singapore’s stock market since the first REIT here was listed in 2005.

A recent Monetary Authority of Singapore (MAS) report (cited by this SGX article) provided some statistics on the health of Singapore’s REITs and demonstrate how far the REIT market here has come. Without further ado, here’re nine numbers about Singapore’s REITs that investors may want to sit up and take notice of:

1. As of 21 December 2016, Singapore has 37 REITs listed on its stock market (according to a Nikko Asset Management article). This number is by far the largest in the region, exceeding the count in Malaysia (16 REITs), Hong Kong (11 REITs), and Thailand (also 11 REITs).

2. REITs accounted for 7.9% of the total market capitalisation of Singapore’s stock market in the third quarter of 2016. Some of the largest REITs in Singapore include CapitaLand Mall Trust (SGX: C38U)Ascendas Real Estate Investment Trust (SGX: A17U) and CapitaLand Commercial Trust (SGX: C61U); they are also components of Singapore’s stock market benchmark, the Straits Times Index (SGX: ^STI).

3. MAS noted in its report that most Singapore REITs have kept their leverage ratio well below the regulatory limit of 45%. MAS also said that the weighted debt maturity for REITs was 3.5 years, up from 3.2 years in 2013. In other words, debt-maturity for REITs is now more spread out.

4. The financial viability of REITs was also examined by MAS using the interest coverage ratio (ICR). The ratio is calculated by dividing EBITDA (earnings before interest, taxes, depreciation and amortisation) by interest expense. MAS said that the median ICR for Singapore’s REITs was 5.4 times and considers it to be strong.

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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 and CapitaLand Mall Trust. Motley Fool Singapore contributor Chin Hui Leong owns shares in CapitaLand Mall Trust.