Singapore’s real estate investment trusts (S-REITs) have shown resilience amidst a broader market downturn, with the STI REITs index rebounding by 5.2% over the five sessions leading to 17 March. This recovery was bolstered by a net institutional inflow of S$50m, with CapitaLand Integrated Commercial Trust (CICT) and Frasers Centrepoint Trust (FCT) recording the most significant inflows.
The recent shift in the US Federal Reserve’s outlook, anticipating an additional 75 basis points cut before 2026, has influenced market dynamics. Larger-cap S-REITs have notably outperformed their smaller-cap counterparts, with the 10 largest by market capitalisation averaging a 4.8% total return, compared to a 3.3% decline for the rest of the sector.
CICT and FCT were standout performers, with CICT achieving a 0.3% net institutional inflow relative to its market capitalisation, and FCT achieving 0.4%. CICT’s assets under management grew by 6% in FY24, with a notable rental reversion increase of 8.8% for retail and 11.1% for office spaces. FCT also reported a 3.4% increase in net property income, excluding divestment impacts.
In contrast, the STI banks, including DBS Group Holdings, Oversea-Chinese Banking Corporation, and United Overseas Bank, faced an average decline of 3.4% over the same period, reflecting broader trade tensions and economic uncertainties. The banks experienced a net institutional outflow of S$490m, highlighting the challenges posed by ongoing trade policies and global economic shifts.
The performance of S-REITs amidst these challenges underscores their potential as a stable investment option, particularly for larger-cap trusts that benefit from institutional and passive flows. As market conditions evolve, the focus remains on strategic positioning to capture growth opportunities.
“`
This news story was carefully selected and published by a human editor, though the content itself was AI-generated. If you spot an error, please report it here.
