Nobody likes to sit through a market crash.
But as the saying goes, “Never waste a good crisis”.
During sell-offs, you will often find yourself with the rare opportunity to accumulate fundamentally sound companies at a discount.
In particular, REITs become more attractive as lower prices provide a better entry point and a higher yield.
Let’s look at three REITs that may fit the bill.
Why REITs Can Be Attractive During Market Crashes
High-quality REITs with solid fundamentals usually won’t see their business erode due to volatility in the financial markets.
Think about it: while higher inflation or higher interest rates might cause some selling pressure on the REIT, its properties are still raking in rental income.
The caveat here is that the properties must be high-quality for the REIT to recover over time.
As mentioned earlier, falling prices also result in a higher distribution yield.
The key takeaway is that market sell-offs can offer you a good opportunity to buy high-quality REITs at a discount.
What Makes a REIT Worth Watching in a Sell-Off
There are some key characteristics to determine if a REIT is worth putting on your shopping list.
For instance, having a reputable sponsor can help a lot, as the sponsor can provide a pipeline of properties for future acquisitions.
Having a solid debt profile with manageable gearing and a well-staggered debt maturity profile can also provide some much-needed breathing room when rates spike.
Stable, high occupancy rates, alongside a strong core of quality tenants across a REIT’s properties, are also desirable as it lessens the chance of rental income falling sharply.
Finally, REITs with a strong, consistent history of paying annual distributions across market cycles is essential as well.
The key takeaway is that the REITs to consider buying in sell-offs have to be of high quality.
Parkway Life REIT (SGX: C2PU) — The Defensive Healthcare REIT
Anchoring your watchlist of quality REITs should be Parkway Life REIT.
As the ultimate defensive healthcare REIT, this nursing home and hospital owner sees resilient demand come rain or shine.
This exposure to essential healthcare services allows Parkway Life REIT to generate stable and predictable rental income across all market cycles.
This is best seen in its distribution payment history, the REIT has never missed a single annual payout since its listing in 2007.
The REIT owns leases tied to inflation and the consumer price index (CPI), ensuring its real income is preserved during times of high inflation, and facilitates annual rental escalations.
Parkway Life’s defensiveness is further evidenced by its high occupancy rate of nearly 100% across all properties (except for France), as of 31 December 2025.
The REIT’s gearing is also relatively low at 33.4%.
Parkway Life currently offers a trailing distribution yield of roughly 3.9%.
The key takeaway is that defensive sectors such as healthcare tend to hold up better during downturns.
Capitaland Integrated Commercial Trust (SGX: C38U), or CICT — The Prime Commercial REIT
Perhaps you would like to take advantage of a downturn to own some commercial properties, tend to suffer during downturns.
Well, look no further than CICT.
This blue-chip REIT owns some of the highest-quality commercial assets in the prime central business district area, including landmarks such as CapitaSpring and Asia Square Tower 2.
Beyond its portfolio of offices, CICT owns several quality shopping malls, such as its 50% ownership of ION Orchard, Tampines Mall, and Bugis+.
The REIT has decent visibility with regard to its future rental income, with a weighted average lease expiry (WALE) of three years across its portfolio.
This is supported by decent rental reversions for 2025, with both retail and office segments up 6.6% year on year (YoY) for 2025 — which help support the REIT’s distributions.
CICT has an attractive estimated trailing distribution yield of 5%.
In short, owning high-quality properties provide the resilience needed for the REIT to ride out downturns.
Keppel DC REIT (SGX: AJBU) — The Data Centre REIT
Rounding things off, we highlight Keppel DC REIT, a REIT that is leveraging long-term growth trends in digitalisation and AI.
While the market experiences volatility and sell-offs, long-term trends such as digitalisation and AI should remain intact.
This will provide some form of downside protection for this data centre REIT.
Indeed, the global outlook for data centres looks bright, as countries and companies worldwide look to beef up their data centre footprint and harness the benefits of AI.
Keppel DC REIT, with its portfolio of 25 data centres, is a prime beneficiary of this megatrend.
Today, shares offer a 4.8% distribution yield.
When the market stabilises, you can be sure this data centre REIT will be one of the first to bounce back.
How I Would Approach Buying During a Crash
Always invest gradually to each of the REITs over time; remember, it’s almost impossible to time the market.
Instead, you can consider buying in tranches depending on what level of distribution yield you get at each price point.
Finally, remember that in the long run, fundamentals are what get you paid, not a focus on short-term price movements.
As always, having discipline in your buying process matters more than having the perfect timing.
What Could Go Wrong
That said, if we enter a prolonged downturn, we might see some of the abovementioned REITs get affected if their tenants are unable to pay their rent.
Furthermore, should interest rates pick up, the payouts given by these REITs could come under pressure.
The key takeaway here is that high-quality REITs are not risk-free.
Get Smart: Prepare Before the Panic Hits
In conclusion, having a shopping list ready for the next market sell-off can pay off in the long-term.
Being prepared allows you to act with certainty and conviction during times of heightened emotions.
Remember, never let a good crisis go to waste; take the time to accumulate some high-quality REITs.
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Disclosure: Wilson.H does not own shares in any of the companies mentioned.
