Investing Updates : Is the NikkoAM-StraitsTrading Asia ex Japan REIT ETF Dividend Sustainable?

Source : 

https://growbeansprout.com/nikkoam-straitstrading-reit-etf-dividend-sustainable

Apple Intelligence : 

The NikkoAM-StraitsTrading Asia ex Japan REIT ETF (SGX: CFA) recently distributed a dividend, with about one-third classified as a return of capital. This raises concerns about dividend sustainability, as returns of capital reduce the fund’s net asset value and future income potential. While the ETF’s long-term data shows a majority of distributions coming from income and gains, the recent return of capital component warrants further investigation for long-term investors.

The NikkoAM-StraitsTrading Asia ex Japan REIT ETF’s distributions are largely supported by underlying REIT performance, with around 90% of payouts backed by earnings and profits. While the ETF’s distribution yield is currently around 5.9%, the weighted average dividend yield of its top 10 holdings is approximately 6.06%. However, potential risks include rising interest rates, sector-specific challenges, and foreign exchange movements, which could impact future payouts.

The NikkoAM-StraitsTrading Asia ex Japan REIT ETF remains a viable option for investors seeking broad-based exposure to the REITs sector.

Investing Updates : Is STI increasingly a REIT index?

Source : 

https://drwealth.com/is-sti-increasingly-a-reit-index/

Apple Intelligence : 

• STI Composition: The Straits Times Index (STI) is still dominated by banks, but REITs are gaining ground.

• REITs in STI: REITs currently account for 10% of the STI’s weightage and will increase with the inclusion of Keppel DC REIT.

• Investor Sentiment: The increasing weightage of REITs in the STI reflects investor confidence in the sector.

• STI Composition: The STI will include eight REITs out of 30 constituents, with real estate-linked counters making up approximately 14.71% of the index’s weightage.

• Singapore’s Economy: Singapore’s economy is heavily influenced by real estate, with a mature REIT sector and a land-scarce environment.

• Investor Sentiment: Despite the global rise of technology stocks, the STI’s skew towards financials and real estate reflects investor preferences and the economic realities of Singapore.

• Investor Preference: Singaporean investors, particularly retail ones, favor income-generating assets like REITs and bank stocks for their dividends and defensive nature.

• Future Trend: REITs are expected to gain a larger proportion of the STI’s weight due to falling interest rates and a focus on consumption, while banks may experience mean reversion due to high valuations and decreasing interest rates.

• REIT Expansion: Capitaland Investment and Link REIT are expanding their REIT offerings, providing Singaporean investors with more options in high-quality REITs globally.

Investing Updates : From 2% to 6%: 5 Reasons T-Bill Investors Should Switch to REITs

Source : 

https://drwealth.com/from-2-to-6-5-reasons-t-bill-investors-should-switch-to-reits/

Apple Intelligence : 

• T-bill Yield Decline: Singapore Treasury Bills (T-bills) yields have declined from a peak of over 4% in 2023 to 2.12% currently, making them less attractive than CPF OA interest.

• Reinvestment Risk: Investors face reinvestment risk as maturing T-bills can no longer be rolled over into equally attractive investments.

• Inflation Impact: The current T-bill yield of 2.12% is below Singapore’s long-term average inflation rate of 2.59%, resulting in a loss of purchasing power.

• Investment Alternative: REITs offer higher yields compared to T-bills, making them an attractive option for income-seeking investors.

• Yield Comparison: Singapore-listed REITs offer an average yield of 6.9%, significantly higher than the 2.12% yield of 1-year T-bills.

• Risk Considerations: REITs come with higher risk compared to T-bills, including price volatility and no capital guarantee, but these risks can be managed through diversification and a long-term perspective.

• Risk and Return: REITs offer a better risk-reward profile than regular stocks, with lower volatility and higher dividend yields.

• Investment Option: REIT ETFs provide diversification across multiple REITs, simplifying the investment process.

• Potential Opportunity: Falling REIT prices due to rising interest rates present attractive entry points for contrarian investors.

• Interest Rate Impact: Declining interest rates, as seen in Singapore’s SORA, benefit REITs by improving margins and potentially boosting capital gains.

• Investment Characteristics: REITs offer long-term income potential with dividends, avoiding reinvestment risk associated with fixed-maturity investments like T-bills.

• Liquidity and Flexibility: REITs provide greater liquidity and flexibility compared to T-bills, allowing for dollar-cost averaging and easy trading on exchanges.

• Investment Advantages: REITs offer ongoing income, flexible entry, and better liquidity compared to traditional real estate investments.

• Accessibility and Simplicity: REITs provide a straightforward and familiar investment option, especially for conservative investors, with business models centered around property ownership and rental income.

• Diversification and Tax Benefits: REITs offer diversification across a portfolio of properties without the high capital outlay of direct ownership, and they enjoy tax transparency, resulting in higher net yields for investors.

• Diversification Strategy: Diversify across income-generating assets like REITs and T-bills to build a resilient portfolio.

• Economic Environment and Asset Performance: REITs perform well during inflation and economic growth, while treasuries are favored during rising interest rates.

• Current Investment Recommendation: Rebalance portfolios by considering REITs, which offer higher yields (6.9%) compared to T-bills (2.12%), in the current low-interest-rate environment.

Investing Updates : REIT Watch – Industrial S-REITs report NPI growth, but managers are cautious on outlook

Source : 

https://www.sgx.com/research-education/market-updates/20250513-reit-watch-industrial-s-reits-report-npi-growth-managers?utm_medium=social&utm_source=sgxinvest-TG&utm_campaign=REIT%20Watch

Apple Intelligence : 

• Industrial S-REIT Performance: Industrial S-REITs reported NPI growth in Q1 2025 due to stable occupancies and positive rental reversions.

• Manager Sentiment: Despite the positive performance, managers remain cautious about the outlook due to macroeconomic challenges.

• Focus Areas: Managers are emphasizing tenant retention and cost management.

• MINT’s Financial Performance: Distribution per unit rose by 1% to S$0.1357, driven by revenue growth from Osaka Data Centre, Tokyo acquisition, and Singapore properties.

• MLT’s Financial Performance: Stable operating performance with 96.2% occupancy and positive rental reversions, but NPI slipped due to lower revenue from China, divested properties, and weakening regional currencies.

• AIMS APAC Reit’s Financial Performance: Stable portfolio occupancy, 20% positive rental reversions, and DPU growth of 2.6% to S$0.096.

• Financial Performance: Distributable income increased by 7% to S$44.2 million in 1Q25, with NPI rising by 22% to S$16 million.

• Rental Reversion: Sabana Industrial Reit reported a 15.3% positive rental reversion in the first quarter, marking four consecutive years of double-digit growth.

• Impact of Trade Tariffs: While trade tariffs pose challenges, the impact on S-REITs is expected to be mitigated by factors like long-term leases and potential reshoring of manufacturing.

Investing Updates : S-REITs Dominate in Market Surge: Must-Watch Picks

Source : 

https://www.moomoo.com/community/feed/s-reit-s-dominate-in-market-surge-must-watch-picks-114192273375238

Apple Intelligence :

• Market Performance: S-REITs outperformed the broader market (STI) with a 5.2% rebound in the past five sessions.

• Investor Sentiment: S-REITs attracted S$50 million net institutional inflow, driven by factors like attractive dividend yields compared to bond yields.

• Interest Rate Impact: Lower interest rates can benefit REITs by reducing financing costs, increasing capital inflows, and pushing up property valuations.

• Economic Impact: Improved regional economic activity, tourism, and potential interest rate cuts could benefit S-REITs.

• Analyst Predictions: Analysts from BMI Research, JPMorgan Chase, Nomura Securities, and DBS Bank are optimistic about the prospects of S-REITs.

• Performance Expectation: S-REIT share prices are expected to rise, potentially surpassing their peak in September 2023.

• Recommended REITs: DBS Group Research recommends CapLand IntCom T, Frasers Cpt Tr, Keppel Reit, Mapletree Ind Tr, Mapletree Log Tr, and ParkwayLife Reit.

• Valuation Attractiveness: Current REIT valuation is attractive with a price-to-book ratio (P/B) of 0.83 times, historically leading to significant returns in the following year.

• China Galaxy Securities International Recommendations: CapLand Ascendas REIT, Keppel DC Reit, CapLand IntCom T, and Frasers Cpt Tr.

Investing Updates : S-REITs Fell in 2024: Are They Still Attractive in 2025 with Higher for Longer Rates?

URL: https://drwealth.com/s-reits-fell-in-2024-are-they-still-attractive-in-2025-with-higher-for-longer-rates/

BoltAI:

In 2024, Singapore Real Estate Investment Trusts (S-REITs) faced significant challenges, with major ETFs like the CSOP iEdge S-REIT Leaders Index ETF and Lion-Phillip S-REIT ETF declining by 11.6% and 9.9%, respectively. Despite the general downturn, some REITs, such as Cromwell European Real Estate Investment Trust, achieved remarkable growth, indicating a diverse performance landscape.

The analysis highlights that REITs with strong Net Property Income (NPI) growth and high dividend yields tended to perform better. However, outliers exist where financial performance did not correlate with market success, suggesting external macroeconomic factors also play a vital role.

Key trends indicate that REITs with lower leverage ratios (below 40%) are currently more appealing to investors. For instance, Cromwell and Keppel DC REIT outperformed due to higher occupancy rates and a focus on logistics and e-commerce, sectors benefiting from ongoing digital and supply chain growth. In contrast, REITs heavily invested in office properties, like IREIT Global, struggled due to the lingering effects of remote work and economic pressures in their primary markets.

The rising interest rates have particularly impacted US office market REITs, making debt servicing difficult, while those with proactive portfolio management strategies, like CapitaLand Integrated Commercial Trust, showed resilience through high occupancy and fixed-rate borrowings.

Looking ahead to 2025, S-REITs may recover, but investors need to be discerning. With the potential for lower interest rates, consumer spending in Southeast Asia is anticipated to grow, particularly in countries like Indonesia and Vietnam. However, caution is advised, especially regarding REITs in Europe, given slow economic growth and debt challenges.

In summary, while some S-REITs may present attractive opportunities in 2025, a careful and selective investment approach is crucial in the face of ongoing macroeconomic uncertainties and higher interest rates.

Opinion:

I see many articles being overly cautious on REITs. Let's go All In Now! 😂

Stay calm. Get your portfolio allocations right.

I think REITs will be fine at some point during Trump's second term.

Investing Updates: Which S-REITs "yielded" the best results in 2024?

URL: https://www.moomoo.com/community/feed/113722459553798?global_content=%7B%22promote_content%22%3A%22mm%3Afeed%3A113722459553798%22%2C%22invite%22%3A103096561%7D&is_recommendation=0&is_recommend_pos=1&futusource=news_headline_list

Gemini Summarized:

The performance of S-REITs in 2024 was mixed. Large-cap, Singapore-focused REITs did well, while small and mid-cap REITs, especially those with overseas assets, underperformed.

Here are the top 10 S-REITs that achieved positive year-to-date gains in 2024:

• Cromwell Reit EUR (CWBU.SG) with a 24% increase
• Keppel DC Reit (AJBU.SG) at 19%
• EliteUKREIT GBP (MXNU.SG) at 15%

Here are the top 10 S-REITs with the highest dividend yields in 2024:

• Prime US ReitUSD (OXMU.SG) with a 14.37% yield
• KepPacOakReitUSD (CMOU.SG) with a 12.38% yield
• EliteUKREIT GBP (MXNU.SG) with a 10.34% yield

Investors looking for stable income may be interested in high dividend-yielding REITs, even if their share prices haven't grown much. However, it's important to stay alert to global economic changes and policy shifts, as they can increase market volatility.