Guarding Your Wealth: Don’t Distribute your Assets to the Wrong People
Synopsis: This seminar is designed for those new to the concept of estate planning. It aims to demystify the process of wealth management and asset distribution, ensuring your hard-earned wealth goes to the right people. We will break down complex jargon into simple terms, making the world of estate planning accessible and easy to understand. The seminar will cover the basics of asset distribution, the importance of having a will, and the role of trusts in protecting your wealth.
Key Takeaways:
Basics of Asset Distribution: Understand the fundamental principles of asset distribution and why it’s crucial to your financial planning.
Importance of a Will: Learn about the role of a will in estate planning and how it can help ensure your assets are distributed according to your wishes.
Trusts and Wealth Protection: Discover how trusts can serve as a tool to protect your wealth and provide for your loved ones.
Join us to gain valuable insights into estate planning and take the first step towards effectively guarding your wealth. No prior knowledge is required, and all are welcome.
Mr. Kenny Loh is a Certified Estate Planning Consultant and also a CERTIFIED FINANCIAL PLANNER (CFP). Kenny has more than 10 years in Holistic Estate Planning experience, using a unique “3-in-1 Will, LPA and Standby Trust” solution, to address his client’s social consideration, legal obligation, emotional needs and family’s harmony in his approach. Kenny has Double Master degree in Business Administration and Electrical Engineering, and also an AEPP (Associate Estate Planning Practitioner) jointly awarded by The Society of Will Writers & Estate Planning Practitioners (SWWEPP) of The United Kingdom, in collaboration with Estate Planning Practitioner Limited (EPPL), the accreditation body for Asia.
Money and Me: What is your T-Bill to S-REIT allocation?
Hosted by Michelle Martin, this episode explores how S-REITS’ performed in 2024 and the possible outlook for 2025 outlook for Singapore-listed REITs with Kenny Loh, REIT Specialist and Independent Financial Advisor.
💡Gain insights into the best and worst-performing S-REITs, geopolitical risks, and a simple but clear strategy to balance yield and risk. 💡The two also discuss opportunities in data centers, hospitality, and industrial REITs. 💡Optimising return with T-Bills to S-REITs allocation.
Key Highlights
[00:00:00] Introduction
Host: Michelle Martin
Guest: Kenny Loh, REIT Specialist and Independent Financial Advisor
[00:01:00] Performance of S-REITs in 2024
Overview of the best and worst-performing S-REITs
Factors influencing their performance
[00:05:15] Outlook for 2025
Predictions for the future of Singapore-listed REITs
Key trends and opportunities
[00:10:30] Geopolitical Risks
Discussion on geopolitical factors affecting REITs
Impact on global and local markets
[00:15:45] Balancing Yield and Risk
Strategy to achieve a balance between yield and risk
Importance of diversification
[00:20:20] Opportunities in Data Centers, Hospitality, and Industrial REITs
Potential growth areas
Key considerations for investors
Note: The above analysis are my own personal views and are NOT buy or sell recommendations. Investors who would like to leverage my extensive research and years of Singapore REIT investing experience can approach me separately for a REIT Portfolio Consultation.
Listen to his previous market outlook interviews here:
Kenny Loh is an Associate Wealth Advisory Director and REITs Specialist of Singapore’s top Independent Financial Advisor. He helps clients construct diversified portfolios consisting of different asset classes from REITs, Equities, Bonds, ETFs, Unit Trusts, Private Equity, Alternative Investments, Digital Assets and Fixed Maturity Funds to achieve an optimal risk adjusted return. Kenny is also a CERTIFIED FINANCIAL PLANNER, SGX Academy REIT Trainer, Certified IBF Trainer of Associate REIT Investment Advisor (ARIA) and also invited speaker of REITs Symposium and Invest Fair.
Technical Analysis of FTSE ST REIT Index (FSTAS351020)
FTSE ST Real Estate Investment Trusts (FTSE ST REIT Index) decreased from 642.87 to 647.67(0.75%) compared to last month’s update.Singapore REITs index is currently forming an inverted head and shoulders chart pattern, trading near the support level of a big wedge pattern.
The following is the compilation of 38 Singapore REITs with colour-coding of the Distribution Yield, Gearing Ratio and Price to NAV Ratio.
The Financial Ratios are based on past data and these are lagging indicators.
All REITshave the latest Q3 2024 values.
I have introduced weighted average (weighted by market cap) to the financial ratios, in addition to the existing simple average ratios. This is another perspective where smaller market cap REITs do not disproportionately affect the average ratios.
FY DPU: If Green, FY DPU for the recent 4 Quarters is higher than that of the preceding 4 Quarters.If Lower, it isRed.
Yield (ttm): Yield, calculated by DPU (trailing twelve months) and Current Price as of January 17th, 2025.
Gearing (%): Leverage Ratio.
Price/NAV: Price to Book Value. Formula: Current Price over Net Asset Value per Unit.
Yield Spread (%): REIT yield (ttm) reference to Gov Bond Yields. REITs are referenced to SG Gov Bond Yield.
As of May 2024, all REITs’ Yield Spread will be referenced to SG Gov Bond Yields, regardless of trading currency.
Price/NAV Ratios Overview
Price/NAV decreased to 0.88 (Weighted Average: 0.88)
Decreased from 0.89 in December 2024.
Singapore Overall REIT sector is slightly undervalued
Most overvalued REITs (based on Price/NAV)
Keppel DC REIT
1.61
ParkwayLife REIT
1.56
Mapletree Industrial Tr
1.23
Capitaland Ascendas REIT
1.19
AIMS APAC REIT
0.98
Mapletree Logistics Tr
0.95
EC World REIT is currently suspended, however at current Price and NAV/Unit values it has a value of 4.67 (N.M)
Most undervalued REITs (based on Price/NAV)
Manulife US REIT
0.26
Lippo Malls Indonesia Retail Trust
0.30
Keppel Pacific Oak US REIT
0.30
Prime US REIT
0.31
Acrophyte Hospitality Trust
0.31
OUE REIT
0.43
Distribution Yields Overview
TTM Distribution Yield remained at 6.08%. (Weighted Average remained similar at 6.20%)
Remained at 6.08% in December 2024. (Weighted Average was 6.19%)
17 of 38 Singapore REITs have ttm distribution yields of above 7%.
Highest Distribution Yield REITs (ttm)
Acrophyte Hospitality Trust
12.45
IREIT Global
11.72
Elite UK REIT
9.25
Stoneweg European REIT
9.23
First REIT
9.06
Sasseur REIT
8.96
Reminder that these yield numbers are based on current prices.
Some REITs opted for semi-annual reporting and thus no quarterly DPU was announced.
A High Yield should not be the sole ratio to look for when choosing a REIT to invest in.
Yield Spread tightened to 3.09%. (Weighted Average remained similar at 4.00%)
Tightened from 3.38% in December 2024. (Weighted Average was 4.01%)
From May 2024 onwards, all my yield spread measurements are now in relation to SG Gov Bond Yields, no longer a mix with US Gov Bond Yields.
Gearing Ratios Overview
Gearing Ratio remained at 39.60%.(Weighted Average: 38.76%)
Remained at 39.60% in December 2024. (Weighted Average: 38.76%)
Gearing Ratios are updated quarterly. Therefore there are no updates this month.
S-REITs Gearing Ratio has been on a steady uptrend. It was 35.55% in Q4 2019.
Highest Gearing Ratio REITs
Manulife US REIT
58.2
EC World REIT
56.1
Prime US REIT
47.8
Elite UK REIT
45.1
Lippo Malls Indonesia Retail Trust
45.0
Acrophyte Hospitality Trust
43.2
MUST and EC World REIT’s gearing ratio has exceeded MAS’s gearing limit of 50%. However, the aggregate leverage limit is not considered to be breached if exceeding the limit is due to circumstances beyond the control of the REIT Manager.
Market Capitalisation Overview
Total Singapore REIT Market Capitalisation decreased by 0.15% to S$86.21 Billion.
Decreased from S$86.34 Billion in December 2024.
Biggest Market Capitalisation REITs (S$m):
Capitaland Integrated Commercial Trust
13198.64
Capitaland Ascendas REIT
11476.17
Mapletree Logistics Tr
6408.42
Mapletree Pan Asia Commercial Trust
6313.20
Mapletree Industrial Tr
6000.84
Frasers Centrepoint Trust
3834.93
Smallest Market Capitalisation REITs (S$m):
Acrophyte Hospitality Trust
124.70
Lippo Malls Indonesia Retail Trust
130.85
Manulife US REIT
159.65
Elite UK REIT
175.26
Prime US REIT
219.74
BHG Retail REIT
223.43
Disclaimer: The above table is best used for “screening and shortlisting only”. It is NOT for investing (Buy / Sell) decision. If you want to know more about investing in REITs, scroll down for more information on the REITs courses.
Singapore REITs has temporarily paused at current level (near the support based on chart pattern) amid of the pulling back of the US 10 Risk Free Rate after hitting a new high at 4.80%. There is a strong inverse relationship between the US 10 Year Risk Free Rate vs FTSE ST REIT Index. Singapore REITs sector is expected to be muted as long as US 10 Year Risk Free rate stay at current level.
US 10 Year Risk Free Rate
Fundamentally, the S-REIT sector is trading at a 12% discount to its fair value, with an average trailing twelve-month (TTM) yield of 6.08%.
According to the current Fed Fund Rate projections from the CME Group, the market expects a 25 basis point cut by end 2025, with a total reduction of 100 basis points cut from the peak of the interest rate cycle in 2024. The cut in interest rate will help to boost the DPU of the REITs which have shorter debt maturity profile and higher percentage of floating rate. However, the impact will only be reflected in the financial statement probably in Q2 or Q3 2025.
Kenny Loh is a distinguished Wealth Advisory Director with a specialization in holistic investment planning and estate management. He excels in assisting clients to grow their investment capital and establish passive income streams for retirement. Kenny also facilitates tax-efficient portfolio transfers to beneficiaries, ensuring tax-efficient capital appreciation through risk mitigation approaches and optimized wealth transfer through strategic asset structuring.
In addition to his advisory role, Kenny is an esteemed SGX Academy trainer specializing in S-REIT investing and regularly shares his insights on MoneyFM 89.3. He holds the titles of Certified Estate & Legacy Planning Consultant and CERTIFIED FINANCIAL PLANNER (CFP).
With over a decade of experience in holistic estate planning, Kenny employs a unique “3-in-1 Will, LPA, and Standby Trust” solution to address clients’ social considerations, legal obligations, emotional needs, and family harmony. He holds double master’s degrees in Business Administration and Electrical Engineering, and is an Associate Estate Planning Practitioner (AEPP), a designation jointly awarded by The Society of Will Writers & Estate Planning Practitioners (SWWEPP) of the United Kingdom and Estate Planning Practitioner Limited (EPPL), the accreditation body for Asia.
US 10 Year Risk Free Rate