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Singapore’s 3 Blue-Chip REITs Have Outpaced 2018’s Market Decline

The Straits Times Index (SGX: ^STI), Singapore’s key stock market barometer, has had a rough 2018, falling 9.1% from the start of this year until the end of November.

But some blue-chips performed better than the rest. In particular, real estate investment trusts (REITs) as a group, showed their resilience amid the current market decline. There are three REITs in Singapore’s STI and here are how they performed (data as of 30 November 2018, unless otherwise stated).

  1. Ascendas Real Estate Investment Trust (REIT) (SGX: A17U) is the first blue-chip REIT with a market capitalization of around S$8 billion. As of 30th September 2018, the REIT owned 98 properties in Singapore, 35 properties in Australia and 12 properties in the United Kingdom with a total asset value of S$10.8 billion. The eleven-month period between January and November this year has seen Ascendas REIT’s share price increase by producing a total return of 0.4%, an outperformance compared to the Singapore’s STI. At today’s prices, the industrial REIT offers a distribution yield of 6.2% and trades at a price to book (PB) ratio of about 1.2.
  2. Next up, we have Capitaland Mall Trust (SGX: C38U), the owner and manager of 16 retail malls spread across Singapore. The retail REIT has outperformed the index over the first eleven months of the year with a return of 12.3%. At current prices, Capitaland Mall Trust sports a market capitalization of S$8.4 billion. The mall owner’s distribution yield was 4.9% and shares are priced at 1.1 times its book value.
  3. The final REIT in the STI is Capitaland Commercial Trust (SGX: C61U). As its name implies, the REIT focuses on the commercial office market. The REIT owns nine commercial properties in Singapore and one in Germany. Capitaland Commercial Trust has produced a 5.6% decline up till November this year. The REIT trades at a market capitalization of S$6.7 billion with a distribution yield of 4.8% at current prices. Its PB ratio stands at 0.98, making it the only REIT out of the three to have a PB below one.

The summary above shows that two out of the three blue-chip REIT delivered a positive return to investors over the first eleven months of the year. As a group, the trio has outperformed the index’s returns, and offer a nice dividend too.

[Editor: We have made an amendment to Ascendas REIT’s stock performance on 28 December 2018]

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The Motley Fool Singapore contributor Esjay contributed to this article. Esjay owns shares in Capitaland Commercial Trust and CapitaLand Mall Trust.

The information provided is for general information purposes only and is not intended to be personalized investment or financial advice. The Motley Fool Singapore has recommendations for shares of Capitaland Commercial Trust, Ascendas REIT and CapitaLand Mall Trust. The Motley Fool Singapore writer Chin Hui Leong owns shares in CapitaLand Mall Trust.