SGX Market Updates

REIT Watch - S-Reits Rebound 7.4 Per Cent in November, Best Month in 3 Years

Publish date: Mon, 04 Dec 2023, 02:52 PM
REIT Watch - S-Reits and property trusts performance and fund flow breakdown by sub-segmentsREIT Watch - iEdge S-Reit Index monthly total returns

The iEdge S-Reit Index ended November with a 7.4 per cent total return, reversing the 7.0 per cent decline seen in October. Similar performance was seen across most major Reit markets after signals from the US Federal Reserve that rate hikes are likely over, with the broader FTSE EPRA Nareit Developed Index gaining 7.8 per cent in total returns over the month.

The November rebound brought the iEdge S-Reit Index’s year-to-date decline from 9.0 per cent as at end October, to 2.2 per cent as at end November. This also marks the largest monthly total return gains for the Index since November 2020.

Four trusts maintained double- digit total return gains in the year to-date till end November – Digital Core Reit (19.6 per cent), Frasers Hospitality Trust (19.2 per cent), Aims Apac Reit (10.7 per cent) and Far East Hospitality Trust (10.2 per cent).

All S-Reits and property trusts that traded in November ended the month in positive territory, with 11 trusts registering double-digit gains. Office S-Reits was the best performing sub-segment, averaging 19 per cent total returns, followed by data centre S-Reits averaging 13.9 per cent and diversified S-Reits averaging 8.1 per cent.

In terms of the sector’s net fund flows over the month, retail investors net sold S$64 million, after six consecutive months of net buying, while institutional investors net sold S$3 million.

CapitaLand Ascendas Reit was the top net bought S-Reit by institutional investors last month at S$40 million, followed by Frasers Logistics and Commercial Trust at S$20 million.

Two S-Reits received net inflows from both institutional and retail investors in November. Keppel DC Reit received S$7 million and S$3 million of net inflows from institutional and retail investors respectively. On a smaller scale, OUE Commercial Reit received S$0.5 million and S$0.1 million of net inflows from institutional and retail investors respectively.

Last week, FTSE Russell announced that there will be no changes to the constituents of the STI Index, following the December 2023 quarterly review. However, Golden Agri-Resources is now part of the STI reserve list, while Keppel Reit was removed. The latest STI reserve list consists of (in alphabetical order): CapitaLand Ascott Trust, Frasers Centrepoint Trust, Golden Agri-Resources, Keppel DC Reit and Suntec Reit.

The four S-Reits in the STI reserve list saw average total returns of 6.1 per cent in November, while the six S-Reits in the STI Index generated 7.5 per cent in average total returns. Frasers Logistics and Commercial Trust was the best performing counter among the 20 S-Reits with 10.3 per cent gains in November.

Source: SGX Research S-Reits & Property Trusts Chartbook.

REIT Watch is a weekly column on The Business Times, read the original version.

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