REIT-TIREMENT - REITs Investing & Personal Finance

REITs investing & personal finance

Tuesday, December 22, 2020

SREITs Fundamental Review @ 22 December 2020

Update: 25 Dec 2020
Market cap for Capitaland Integrated Commercial Trust should be around S$ 13.8 Billion, instead of S$ 7.897 as shown below.

* Above is extracted from SREITs Data
** Ascendas India Trust and Dasin Retail Trust are Business Trust
*** Eagle Hospitality Trust is suspended and would be excluded for statistics below.

Dividend Yield

 ItemsAverage MedianMinMax
Dividend Yield - Healthcare8.43%8.43%3.54%13.32%
Dividend Yield - Retail5.95%5.29%3.26%11.23%
Dividend Yield - Office6.62%6.68%3.61%8.8%
Dividend Yield - Hospitality3.74%4.14%2.64%4.46%
Dividend Yield - Industrial4.84%4.44%3.09%7.4%
Dividend Yield - Logistics6.79%7.23%4.16%8.53%

* Based on REIT Major Sector

Highest Div. Yield% Lowest Div. Yield%
1First REIT13.32%Frasers Hospitality Trust2.64%
2Lippo Malls Indonesia Retail Trust11.23%Keppel DC REIT3.09%
3United Hampshire US REIT9.31%ARA US Hospitality Trust3.13%
4Prime US REIT8.8%SPH REIT3.26%
5Keppel Pacific Oak US REIT8.75%Parkway Life REIT3.54%

Key Financial Metrics

 ItemsUnit Average MedianMinMax
Price/ NAVtime0.970.880.422.38
Market Cap, BS$2.521.420.2113.85
Property Yield (Annualized)%
Management Fees over Distribution%16.6614.717.7439.19
Distribution on Capital (Annualized)%3.323.211.195.39
Distribution Margin%45.2648.47.7770.14

* SREITs in Foreign Currencies converted to SGD for Market Cap Comparison

Highest P/NAVtime Lowest P/NAVtime
1Keppel DC REIT2.38Lippo Malls Indonesia Retail Trust0.42
2Parkway Life REIT1.97First REIT0.42
3Mapletree Industrial Trust1.68Starhill Global REIT0.61
4Mapletree Logistics Trust1.64ARA US Hospitality Trust0.61
5Ascendas REIT1.36OUE Commercial REIT 0.62

Lease Profile

 ItemsUnitAverage MedianMinMax
Committed Occupancy%94.9496.0580.2100
Income Received in SGD/Major Currencies%78.411000100
Highest Lease Maturity in 5 Years%35.5831.80100
Weighted Average Lease Expiry, WALEyear4.5841.113.7
Weighted Average Land Lease Expiryyear66.570.223.4199

  • Sabana REIT and Lippo Malls Indonesia Retail Trust are having committed occupancy of less than 90%
  • 8 SREITs are having 0% of income received in SGD/major currencies.
  • ARA Hospitality Trust, EC World REIT and Sasseur REIT are having the highest lease maturity within 5 years of more than 70% in a single year.
  • CapitaLand Integrated Commercial Trust, CapitaLand Retail China Trust, Sasseur REIT and Frasers Centrepoint Trust are having WALE of less than 2.5 years.
  • BHG Retail REIT, CapitaLand Retail China Trust, Dasin Retail Trust and ESR REIT are having weighted average land lease expiry of less than 30 years.

Debt Profile

 ItemsUnitAverage MedianMinMax
Interest Coverage Ratiotime4.63.91.517
Cost of Debt%2.882.770.545.53
Fixed Debt over Total Debt%72.32800100
Unsecured Debt over Total Debt%58.4175.60100
Gearing Ratio%36.7736.827.843
Highest Debt Expiry in 5 Years%40.2231.313.75100
Weighted Average Debt Expiry, WADEyear2.892.91.264.7

  • ARA Hospitality Trust, BHG Retail REIT, Dasin Retail Trust and Frasers Hospitality Trust are having interest coverage ratio of less than 2.5 times
  • Ascendas India Trust, Dasin Retail Trust and Lippo Malls Indonesia Retail Trust are having cost of debt of more than 5%.
  • Dasin Retail Trust, First REIT, Sasseur REIT and SPH REIT are having fixed debt % of less than 50%.
  • 12 SREITs are having unsecured debt of 0%.
  • The 5 SREITs with the highest gearing ratio are ARA Hospitality Trust @ 43%, Lippo Malls Indonesia Retail Trust @ 42.5%, ESR-REIT @ 41.6, Suntec REIT @ 41.5% and ARA LOGOS Logistics Trust @ 40.5%
  • BHG Retail REIT, EC World REIT, Elite Commercial REIT, Lendlease Global Commercial REIT and Sasseur REIT are having the highest debt maturity within 5 years of more than 75% in a single year.
  • BHG Retail REIT, First REIT and Sabana REIT are having WADE of less than 1.5 years.

Diversification Profile

 ItemsUnit Average MedianMinMax
Major Sector Contribution%84.7194.7439.52100
2nd Sector Contribution%11.664.09045.8
3rd Sector Contribution%3.260026.12
Top Geographical Contribution%59.5556.289.1100
Top Property Contribution%25.1621.474.5266.36
Top Tenant Contribution%20.0710.63.2100
Top 10 Tenants Contribution%48.2937.7217.56100

  • 16 SREITs are having major sector contribution of 100%.
  • 15 SREITs are having top geographical contribution of more than 75%.
  • BHG Retail REIT, Lendlease Global Commercial REIT, SPH REIT and Suntec REIT are having top property contribution of more than 50%.
  • ARA Hospitality Trust, Elite Commercial REIT, FIRST REIT and Parkway Life REIT are having top tenant contribution of more than 50%.
  • 10 SREITs are having top 10 tenants contribution of more than 75%.

Financial Engineering/Income Support and Distribution from Asset Disposal 

NameSupport / Distribution Disposal / Distribution 
ARA LOGOS Logistics Trust
Ascendas REIT1.8% 
Ascott Residence Trust 22.6%
BHG Retail REIT4.8% 
CDL Hospitality Trusts 9%
Cromwell European REIT 3%
Dasin Retail Trust29.6% 
Frasers Logistics & Commercial Trust 2.7%
Keppel DC REIT2.6% 
Keppel REIT 9.9%
Lippo Malls Indonesia Retail Trust9.4% 
Mapletree Logistics Trust 6.1%
OUE Commercial REIT13.4% 
Soilbuild Business Space REIT1.3% 
Suntec REIT2%3.1%
United Hampshire US REIT12.6%

Generally, SREITs are undervalued in terms of Price/NAV with the median at 0.87. The median dividend yield of 5.29% is attractive in view of the current low interest rate environment. However, note that both DPU and NAV are lagging figures. SREITs result announcement for 4Q 2020 is around the corner, you could refer to SREITs Result Date page in which I would update the result announcement date as and when available.

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