Investors will all agree that receiving a dividend is a happy occasion.
Dividends can help supplement your earned income and act as a layer of passive income that can support you during your retirement years.
Income-seeking investors who are looking for a suitable asset class for dividends can turn to REITs.
REITs are bundles of real estate portfolios that are mandated to pay out at least 90% of their profits as distributions to enjoy tax benefits.
With these attributes, REITs make the perfect income instrument for an investor who desires reliable and steady dividends.
We profile five Singapore REITs that are doling out dividends this month.
First REIT (SGX: AW9U)
First REIT is a healthcare REIT with a portfolio of 32 properties across Singapore, Indonesia and Japan.
Its assets under management (AUM) stood at S$1.15 billion as of 31 December 2022.
First REIT reported a mixed set of earnings for its 2023’s first half (1H 2023).
Total rental income inched up 0.4% year on year to S$54 million but net property income (NPI) dipped by 0.6% year on year to S$52.4 million.
Distribution per unit (DPU) fell by 6.1% year on year to S$0.0124.
For the second quarter of 2023 (2Q 2023), DPU came in at S$0.0062, dipping slightly from S$0.0066 a year ago.
This DPU will be paid out on 25 September.
The REIT’s gearing level stood at 38.7% with an all-in cost of debt of 4.9% as of 30 June 2023.
The good news is that 86% of First REIT’s loans are hedged to fixed rates, thereby mitigating a sharp rise in finance costs due to an increase in interest rates.
Mapletree Pan Asia Commercial Trust (SGX: N2IU)
Mapletree Pan Asia Commercial Trust, or MPACT, is a retail and commercial REIT with a portfolio of 18 properties in five countries.
Its AUM stood at S$16.6 billion as of 31 March 2023.
MPACT also reported a mixed result for its fiscal 2024 first quarter (1Q FY2024).
Gross revenue soared 75.6% year on year to S$237.1 million while NPI climbed 68% year on year to S$179.2 million.
The better top-line performance was because of the merger between Mapletree Commercial Trust and Mapletree North Asia Commercial Trust.
DPU, however, fell by 12.8% year on year to S$0.0218 because of higher interest costs and adverse foreign exchange movements.
This DPU will be paid on 14 September.
Looking ahead, MPACT’s core asset VivoCity has completed its asset enhancement initiative that is projected to deliver a return on investment of more than 20%.
The portfolio also enjoyed a positive rental reversion of 2.4% and saw a high tenant retention rate of 79.1%.
Aggregate leverage came in at 40.7% with close to three-quarters of MPACT’s loans on fixed rates.
Sabana REIT (SGX: M1GU)
Sabana REIT is an industrial REIT with a portfolio of 18 properties in Singapore with a total value of more than S$900 million as of 31 December 2022.
The REIT reported a respectable set of results for 1H 2023, with revenue climbing 23.2% year on year to S$55.3 million.
NPI edged up 0.5% year on year to S$27.2 million and DPU improved by 1.3% year on year to S$0.0161.
This DPU will be paid out on 14 September.
Sabana REIT recorded a new quarterly high positive rental reversion of 27.1% for 2Q 2023.
The REIT is also making good progress on its AEI at 1 Tuas Avenue 4 which is slated to complete by 1H 2024.
Gearing stood fairly low at 32.5% with an all-in financing cost of 3.89%.
CapitaLand Integrated Commercial Trust (SGX: C38U)
CapitaLand Integrated Commercial Trust, or CICT, is a retail and commercial REIT with a portfolio of 26 properties in Singapore, Germany, and Australia.
CICT’s portfolio was worth S$24.2 billion as of 31 December 2022.
The REIT delivered a sparkling set of results for 1H 2023 as both revenue and NPI climbed year on year.
DPU inched up 1.5% year on year to S$0.053.
The distribution will be paid on 15 September.
CICT reported positive rental reversion for both its retail and office segments.
Its retail division also enjoyed a 6% year on year increase in tenant sales for 1H 2023 while shopper traffic jumped by 17.5% year on year.
Aggregate leverage stood at 40.4% as of 30 June 2023 with the average cost of debt at 3.2%.
Digital Core REIT (SGX: DCRU)
Digital Core REIT, or DCR, is a pure-play data centre REIT with a portfolio of 11 data centres across the US, Canada, and Germany.
As of 30 June 2023, its AUM stood at US$1.6 billion.
Like MPACT and First REIT, DCR also reported a mixed set of results for 1H 2023.
Gross revenue inched up 1.1% year on year to US$53.9 million.
NPI, however, slid 0.7% year on year to US$35.2 million because of higher interest expenses.
DPU fell by 6.8% year on year to US$0.0192.
The DPU will be paid out on 28 September.
DCR’s aggregate leverage stood at 34.2% as of 30 June 2023 along with a cost of debt of 4.7%.
72% of its debt is on fixed rates and the REIT has no debt maturities until December 2025.
Not sure which REIT to put your money in? Use our 7-step REIT checklist to find one that fits into your retirement plan. Checklist is inside our latest FREE report “Singapore REITs Retirement Plan”. Click here to download it now.
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Disclosure: Royston Yang owns shares of Digital Core REIT.
