The REIT sector is seeing some light at the end of the tunnel with interest rates moderating and inflation declining.
REITs have employed a variety of tactics to address these challenges over the past three years.
In particular, several REITs have undertaken acquisitions to boost their asset base and increase their distribution per unit (DPU).
Here are four Singapore REITs that have recently carried out such acquisitions, promising higher distributions for investors.
CapitaLand Ascott Trust (SGX: HMN)
CapitaLand Ascott Trust, or CLAS, is Asia-Pacific’s largest lodging trust with total assets of S$8.8 billion as of 30 June 2025.
Its portfolio comprises 101 properties with more than 18,000 units in 45 cities across 16 countries.
CLAS announced the acquisition of three freehold rental housing properties in Japan for JPY 4 billion (around S$34.2 million).
Two of the properties are in Osaka, while the third is located in Kyoto.
The projected net operating income (NOI) entry yield for this acquisition is 4% in 2025, and is significantly higher than the exit NOI yield of just 0.4% arising from the divestment of Citadines Karasuma-Gojo Kyoto.
On an annualised basis, the acquisition of these three properties more than replaces the lost income from the divestment.
This purchase should also result in an accretion of 0.3% for CLAS’s distribution per stapled security (DPSS).
These three properties are located in prime areas with an average lease term of around two years.
The average occupancy for these properties is 97% and will add to the hospitality trust’s stable income stream.
Post-acquisition, CLAS will end up with 33 assets in Japan, and its properties in the living sector, such as rental housing and student accommodation, account for around 17% of its total portfolio value.
Rents in both Osaka and Kyoto have been trending higher in the past decade and are expected to rise between 10% to 15% over the next five years, which will bode well for CLAS’ recent acquisition.
AIMS APAC REIT (SGX: O5RU)
AIMS APAC REIT, or AAREIT, is an industrial REIT with a portfolio of 27 properties, 24 of which are in Singapore and the remaining three in Australia.
AAREIT will acquire Framework Building at 2 Aljunied Avenue 1 for a total consideration of around S$56.65 million.
Based on year one’s net property income (NPI) and the purchase consideration, this property is projected to have an initial NPI yield of 8.1%.
Assuming 100% debt funding, this acquisition will add 2.5% to AAREIT’s DPU.
But if proceeds from the recent equity fund-raising were utilised in addition to debt, then DPU accretion will be lower at 0.5%.
The total net lettable area of the building is 16,082 square metres, and the building is 97% occupied.
The property also contains flexible building configurations with value-add potential, and AAREIT could enhance specifications to attract high-quality manufacturing, life science, or high-tech tenants.
CapitaLand Integrated Commercial Trust (SGX: C38U)
CapitaLand Integrated Commercial Trust, or CICT, is a retail and commercial REIT with a total of 26 properties across Singapore (21), Germany (2), and Australia (3).
These properties are valued at S$25.9 billion as of 31 December 2024.
CICT agreed to acquire 55% of the commercial component of CapitaSpring for S$1.05 billion at an entry yield in the low-4% region.
This purchase is based on an agreed property value of S$1.9 billion, which is the average of two independent valuations.
The total acquisition outlay is approximately S$482.3 million, which will be funded by proceeds raised through a private placement of units.
This purchase is expected to result in DPU accretion of 1.1% for the first half of 2025’s DPU of S$0.0562, raising it to S$0.0568.
Following this acquisition, CICT’s pro-forma aggregate leverage is expected to rise just slightly from 37.9% to 38.3%.
United Hampshire US REIT (SGX: ODBU)
United Hampshire US REIT, or UHREIT, owns a diversified portfolio of grocery-anchored and necessity-based retail properties and self-storage properties.
Its portfolio comprises 19 retail properties and two self-storage properties worth around US$731 million as of 31 March 2025.
In early August, UHREIT purchased Dover Marketplace in Pennsylvania for around US$16.4 million, or 4.8% below the independent valuation of the property.
The acquisition is fully funded by proceeds from the divestment of Albany Supermarket, which was completed in the first quarter of 2025 (1Q 2025).
The purchase will provide a 2% uplift to UHREIT’s DPU, from US$0.0395 to US$0.0403.
Dover Marketplace is anchored by GIANT, a leading supermarket operator, which has been an anchor tenant for nearly 25 years.
The property has a total net lettable area of 61,044 square feet with a committed occupancy of 96.1%.
Dover Marketplace has a long weighted average lease expiry of 9.7 years.
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Disclosure: Royston does not own shares in any of the companies mentioned.
