Singapore REIT Fundamental Analysis Comparison Table – 3 January 2016

FTSE ST Real Estate Investment Trusts (FTSE ST REIT Index) decreases from 699.39 to 695.93 (-0.49%) compare to last post on Singapore REIT Fundamental Comparison Table on Dec 6, 2015. The index looks like consolidating in a Symmetrical Triangle. The long term trend remains down as the index is trading below 200D SMA which is also sloping down. US Fed finally announces the interest rate hike of 0.25%.  However there was NO sell off in Singapore REIT and it was confirmed the fear was already priced in the stock price. After throwing out this interest rate hike fear out of the picture, we have to focus back on the economy condition and the sectors of Singapore REIT participate in. 5 Key main sectors for Singapore REITs are Industrial, Retail, Commercial Office, Health Care and Hospitality.

FTSE ST REIT Index Jan3-2016

  • Price/NAV remains at 0.93  (Singapore Overall REIT sector is under value now)
  • Distribution Yield decreases from 7.42% to 7.36% (take note that this is lagging number).  More than half of Singapore REITs (21 out of 37) have Distribution Yield > 7%. Current yield is attractive but dangerous to make investing decision purely base on the yield. Past performance does NOT equal to future performance. As the price of FTSE ST REIT index dropped and the overall yield also dropped, it only explained one thing: Overall DPU are dropping, which is a bad sign.
  • Gearing Ratio decreases from 34.82% to 34.78%.  20 out of 37 have Gearing Ratio more than 35%.
  • Most overvalue is Parkway Life (Price/NAV = 1.40),  followed by Ascendas iTrust (Price/NAV = 1.34).
  • Most undervalue (base on NAV) is Fortune REIT (Price/NAV = 0.64), followed by Keppel REIT (Price/NAV = 0.68), Far East HTrust (Price/NAV = 0.69) and Sabana REIT (Price/NAV = 0.69).
  • Higher Distribution Yield is Croesus RTrust (10.19%), followed by Sabana REIT(9.82%)
  • Highest Gearing Ratio is Croesus Retail Trust (47.3%) followed by iREIT Global (43.4%)
  • Added BHG Retail REIT in this table (Refer to Row 6). See BHG Retail REIT IPO Prospectus.



Disclaimer: The above table is best used for “screening and shortlisting only”. It is NOT for investing (Buy / Sell) decision. To learn how to use the table and make investing decision, Sign up next REIT Investing Seminar here to learn how to choose a fundamentally strong REIT for long term investing for passive income generation.

Singapore Interest Rate Jan3-2016 SIBOR Jan3-2016

  • Singapore Interest Rate decreases from 0.64% to 0.23%
  • 1 month increases from 0.94941% to 0.98806%
  • 3 month increases from 1.07108% to 1.13700%
  • 6 month increases from 1.13025% to 1.19175%
  • 12 month increases from 1.25222% to 1.31525%

Currently most  REITs in Singapore are trading below 200D SMA which is technically bearish but in consolidation mode (see Singapore REIT Charts here). Although the distribution yield are very attractive but do take note that this is a lagging number. As REIT is very much depends on the economic cycle, it is important to keep a close eye on economic data (i.e. GDP, consumer spending, PMI) as economic condition will affect the future NPI. NPI will affect Distribution and share price. However, some REITs are more defensive in nature and less sensitive to economy slow down.

Some of the REITs in Singapore are currently trading at an attractive valuation and yield.  US Fed Reserve finally increased the interest but there was NO knee jerk effect and sell off. If the economy is not further deteriorating but stabilizing, the current price level and distribution yield present a good opportunity to accumulate in small quantity to build up our investment portfolio. Singapore REIT is still one of the best instrument for investment which can generate consistent and predictable passive income for our retirement.

If you want to learn how to select a SAFE REITs with predictable and consistent distribution payout, enter at the right price and right time,come and join the seminar on How to Invest in Singapore REIT to generate Passive Income.

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