The REIT sector is seeing a sliver of hope as interest rates moderate and inflation heads lower.
In the recent earnings season, more than a handful of REITs reported not only higher revenue and net property income (NPI), but also higher distributions.
However, REIT managers are not standing still.
Many are carrying out acquisitions and/or divestments to strengthen their REIT portfolios while boosting distribution per unit (DPU).
Here are four Singapore REITs that recently undertook actions to increase their DPU.
CapitaLand Ascott Trust (SGX: HMN)
CapitaLand Ascott Trust, or CLAS, is a hospitality trust with a portfolio of 101 properties with more than 18,000 units in 45 cities across 16 countries.
CLAS’s portfolio value stood at S$8.8 billion as of 30 June 2025.
In late July, the hospitality trust announced the divestment of Citadines Central Shinjuku Tokyo for JPY 25 billion (around S$222.7 million).
This sale is double the book value of the property and at a 40% premium to two independent valuations.
The exit earnings before interest, taxes, depreciation and amortisation (EBITDA) yield is 3.2%, and the trust will book an estimated net gain of S$50.8 million post-divestment.
The property, which has 206 units, was built in 2008 and requires significant capital investment.
By selling this property, CLAS can redeploy the proceeds into other uses such as repaying high-interest debt, funding asset enhancement initiatives (AEIs), or reinvesting in higher-yielding properties.
Assuming the proceeds are used to repay debt, there will be a distribution per stapled security (DPS) accretion of 1% based on 2024’s DPS.
United Hampshire US REIT (SGX: ODBU)
United Hampshire US REIT, or UHREIT, is a retail and self-storage REIT with a portfolio of 19 grocery and necessity properties and two self-storage properties.
These properties had a carrying value of around US$731 million as of 31 December 2024.
In early August, UHREIT announced the acquisition of Dover Marketplace in Pennsylvania for approximately US$16.4 million.
The purchase price is around 4.8% below the property’s independent valuation of US$17.2 million.
Dover Marketplace is a retail neighbourhood shopping mall with a net lettable area of around 61,044 square feet and a committed occupancy of 96.1%.
The property also boasts a long weighted average lease expiry (WALE) of 9.7 years, which will boost UHREIT’s WALE of 7.8 years as of 31 March 2025.
The anchor tenant for this property is Ahold Delhaize (AMS: AD), one of the world’s largest food retail groups.
The CEO of the manager, Gerard Yuen, said that this acquisition will provide UHREIT with an enhanced yield and also result in a 2% uplift to UHREIT’s 2024 DPU of US$0.0395, raising this to US$0.0403.
Lendlease Global Commercial REIT (SGX: JYEU)
Lendlease Global Commercial REIT, or LREIT, owns a portfolio comprising Jem (an office and retail building), 313 @ Somerset, both in Singapore, along with Sky Complex, which comprises three Grade A office buildings in Milan, Italy.
These five properties have an appraised value of around S$3.76 billion as of 30 June 2025.
Last week, LREIT announced the divestment of Jem’s office component for a consideration of S$462 million.
Jem’s office component comprises 12 levels of office space leased to the Ministry of National Development.
The divestment proceeds are estimated at S$459.4 million and will allow the REIT to book an estimated net cash gain of around S$8.9 million.
These proceeds will be used to pay down debt, helping to reduce LREIT’s gearing ratio from 42.6% to around 35%.
The gain on disposal from the transaction is also available for distribution to unitholders.
The sale will realise the value of Jem’s office component and increase the REIT’s focus on retail.
CapitaLand Integrated Commercial Trust (SGX: C38U)
CapitaLand Integrated Commercial Trust, or CICT, is a retail and commercial REIT with a portfolio comprising 21 properties in Singapore, two in Germany, and three in Australia.
The value of CICT’s portfolio stood at S$25.9 billion as of 31 December 2024.
Last week, CICT acquired the remaining 55% interest in CapitaSpring’s premium Grade A office tower for S$1.045 billion.
The sellers are CapitaLand Development (45%) and Mitsubishi Estate Co Ltd (10%).
The agreed property value is S$1.9 billion, and CICT’s entry yield is in the low 4% range.
Located in the heart of Raffles Place, CapitaSpring is a 51-storey integrated development with a net lettable area of around 673,300 square feet.
The property has 30 tenants and a very high committed occupancy rate of 99.9%.
Following this acquisition, CICT’s portfolio value will grow from the existing S$25.9 billion to S$27 billion.
CapitaSpring has potential growth upside given Singapore’s limited new core CBD Grade A office supply.
This acquisition is poised to increase 1H 2025’s DPU by 1.1%, from S$0.0562 to S$0.0568.
CICT undertook a private placement of new units at S$2.11 per new unit and raised proceeds of around S$600 million to pay for this acquisition.
Aggregate leverage post-acquisition is expected to be 38.3%, only slightly higher than 1H 2025’s 37.9%.
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Disclosure: Royston Yang does not own shares in any of the companies mentioned.
