After two years of restrictive borrowing costs and suppressed valuations, the Singapore REITs market is entering a pivot point.
With interest rate cuts projected for 2026, investor sentiment is finally turning positive.
Valuations remain attractive, currently trading below their historical price-to-book averages.
Despite ongoing refinancing challenges, cooling inflation is significantly easing the pressure on cost-of-debt.
Historically, the market prices in recovery well before policy changes take effect, making January an ideal window to re-examine high-quality names with robust balance sheets and resilient occupancy.
Here are four REITs to watch as we start the new year.
Keppel REIT (SGX: K17U)
Keppel REIT kicks off 2026 on stronger ground, backed by a steady underlying operating performance over the past two years, despite challenges from cost inflation.
Net property income grew 11.8% year on year (YoY) for 1H2025, fueled by increased earnings contribution from its Australian assets and leasing demand in its key markets.
While distribution per unit (DPU) declined by 2.9% due to management electing to receive a portion of the fees in cash rather than units, this strategic shift benefits unitholders over the long term by mitigating future dilution.
Portfolio occupancy maintained at 95.9%, with a rental reversion of 12.3%, indicating a favorable demand and a shortage of new supply of Grade-A office spaces.
Keppel REIT’s outlook remains favorable through 2026, supported by disciplined gearing, easing refinance spreads, and market rents consistently outpacing expiring leases.
Mapletree Pan-Asia Commercial Trust (SGX: N2IU)
Mapletree Pan-Asia Commercial Trust, or MPACT, provides investors a well-rounded mix of resilient Singaporean assets and select offshore exposure, and is well-positioned as interest rates stabilise.
For the second quarter of fiscal year 2026 (2QFY26) DPU increased 1.5% YoY on the back of steady performance contributed by key Singapore properties (such as VivoCity) and Festival Walk in Hong Kong, though the Chinese and Japanese markets continue to experience soft conditions.
The trust has been executing a proactive portfolio optimisation strategy, which includes asset enhancement schemes and strategic capital recycling.
The value-accretive divestment of Mapletree Anson for S$775 million, completed in July 2024, has strengthened MPACT’s balance sheet by reducing gearing from 40.5% to 37.6% and improving interest coverage to 3.0 times.
The divestment also delivered 1.5% DPU accretion on a pro forma basis, demonstrating management’s commitment to maintaining stable distributions.
Trading at S$1.48 per share, MPACT offers an attractive distribution yield of approximately 5.5%, supported by a healthy balance sheet and improving financial metrics.
Its high-quality portfolio anchored by VivoCity and Mapletree Business City, and disciplined capital allocation approach make it a very attractive pick for those seeking a stable income stream with some growth options, while being able to create long-term value even with a stable business model.
CapitaLand Ascott Trust (SGX: HMN)
CapitaLand Ascott Trust (CLAS) is a hospitality REIT established in Asia-Pacific, geographically dispersed with a substantial portfolio of over 100 properties spread across more than 45 cities.
For 3Q2025, the trust reported resilient operating metrics, including higher occupancy of its portfolio at 83% and a near 3% increase in RevPAR, suggesting continued strong demand in key markets (Australia, the UK, and the US), amid a steady performance in Singapore.
DPU saw a marginal decline of 1% to S$0.0253.
Nevertheless, the trust is in good shape, with gearing at 39.3% and an interest cover of 3.1 times.
Being close to its 52-week high at S$0.93, CLAS presents a yield of 6.5% based on its trailing distributions and is slightly undervalued at 0.82 times its book value.
CLAS continues to offer a balanced mix of income and growth, supported by a diversified Asia-Pacific portfolio and improving occupancy trends.
With steady distributions, stable financial metrics and targeted asset enhancements, the REIT remains well-positioned to benefit from the ongoing recovery in travel and lodging demand in 2026.
Frasers Centrepoint Trust (SGX: J69U)
Frasers Centrepoint Trust (FCT) emerges as an REIT to watch entering 2026, due to the defensive nature of its Singapore-focused suburban retail property portfolio and earnings momentum.
For 2HFY2025, FCT has reported gross revenue of S$205.2 million and net property income of S$144.3 million, marking robust results and successful acquisition and earnings performance driven by the acquisition of Northpoint City South Wing.
DPU continued on an uptrend, bringing the full-year FY2025 DPU to S$0.1211 (up 0.6% YoY), driven by healthy foot traffic, favorable rental reversions, and prudent expense management.
The REIT remains on firm footing, with aggregate leverage standing at approximately 39.6% and an interest cover ratio of 3.46 times, supporting its balance-sheet flexibility within the uncertain interest-rate environment.
With an aggregate portfolio occupancy of 98.1% and sustained focus on nurturing its necessity retail assets, FCT remains well-positioned with income-focused investors looking for visibility and reliability with regard to distributions in 2026.
Get Smart: Balance Yield and Growth
These Singapore REITs offer a blend of defensive income, structural growth, and selective value.
CLAS leverages portfolio reconstitution and strategic asset enhancements to capture the long-term lodging demand, while Keppel REIT benefits from robust sponsor support and premium office exposure.
Meanwhile, FCT delivers resilient suburban retail cash flows characterised by high occupancy and steady distributions.
MPACT anchors its growth in a dominant Singaporean core while pursuing pan-Asian expansion.
Ultimately, investors should prioritise asset quality and distribution sustainability over market timing to navigate the current REIT landscape.
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Disclosure: Darien does not own any of the shares mentioned.
