The REIT sector saw a reprieve of sorts when inflation eased towards the end of last year.
However, interest rates are still hovering at multi-year highs, which will raise REITs’ finance costs and depress their distributions.
As a result, the asset class is seeing lingering pessimism with many REITs hitting their 52-week lows.
It did not help that inflation in the US came in higher than expected, thereby reinforcing the notion that interest rates may stay “higher for longer”.
Here are five Singapore REITs that recently touched their year-lows, but could they represent bargains that you should scoop up?
Mapletree Industrial Trust (SGX: ME8U)
Mapletree Industrial Trust is an industrial REIT with a portfolio of 141 properties across six property segments such as flatted factories, data centres, and Hi-Tech buildings.
These properties are spread across the US (56), Singapore (83) and Japan (2), and the REIT has assets under management (AUM) of S$9.2 billion as of 31 December 2024.
MIT’s unit price has declined by 14% in the past year and the REIT hit its 52-week low of S$2.01 recently.
The industrial REIT has, however, put up a commendable showing for its latest earnings report for the third quarter of fiscal 2025 (3Q FY2025) ending 31 December 2024.
Gross revenue inched up 2% year on year to S$177.3 million while net property income (NPI) rose 2.6% year on year to S$133.2 million.
The REIT’s distribution per unit (DPU) improved by 1.5% year on year to S$0.0341.
The portfolio maintained a high occupancy rate of 92.1% and also registered a positive rental reversion of 9.8% for renewal leases across Singapore.
With gearing at 39.8% and a cost of debt of 3.1%, the REIT still can tap into borrowings to fund more acquisitions in the future.
Frasers Logistics & Commercial Trust (SGX: BUOU)
Frasers Logistics & Commercial Trust, or FLCT, has a well-diversified portfolio of 114 properties spread across Singapore, the Netherlands, Germany, Australia, and the UK.
FLCT’s portfolio value stood at S$6.8 billion as of 31 December 2024.
The industrial and commercial REIT saw its unit price decline by 21.5% in the past year and touched its 52-week low of S$0.85.
The REIT boasts a high occupancy rate of 94.3% and also registered impressive positive rental reversions of 41.8% for the first quarter of fiscal 2025 (1Q FY2025).
The aggregate leverage was also moderate at 36.2% with a trailing 3-month cost of borrowing of 3.1%.
FLCT still has a debt headroom of S$1.88 billion before it hits the statutory gearing limit of 50%.
Digital Core REIT (SGX: DCRU)
Digital Core REIT, or DCR, is a data centre REIT with a portfolio of 10 data centres worth US$1.6 billion.
The data centre REIT’s unit price tumbled more than 20% in one year to hit its 52-week low of US$0.50.
DCR reported a resilient set of earnings for 2024 with gross revenue slipping just 0.3% year on year to US$102.3 million.
NPI dipped by 1.9% year on year to US$61.8 million while DPU was reduced by 2.7% year on year to US$0.036.
Despite this weakness, the REIT maintained a high occupancy rate of 97% for its data centre portfolio.
The portfolio also enjoyed a positive cash rental reversion of 4.3%.
Aggregate leverage stood low at 34% with an average cost of debt of 3.9%, allowing the REIT to tap into borrowings to possibly fund acquisitions from its sponsor Digital Realty Trust (NYSE: DLR).
CapitaLand Ascott Trust (SGX: HMN)
CapitaLand Ascott Trust, or CLAS, is a hospitality trust with a portfolio of 100 properties in 45 cities across 16 countries.
CLAS’s AUM stood at S$8.8 billion as of 31 December 2024.
The trust saw its shares decline by 6% in the past year and recently touched their 52-week low of S$0.85.
CLAS reported a mixed set of earnings for 2024 with revenue and gross profit increasing by 9% and 10%, respectively, to S$809.5 million and S$370.9 million.
However, distribution per stapled security (DPSS) declined by 7% year on year to S$0.061 because of higher finance costs.
The trust saw revenue per available unit (RevPAU) increase by 9% year on year to S$176 for the fourth quarter of 2024.
All its key markets also saw same-store year-on-year increases, demonstrating sustained demand for lodging.
Just last month, CLAS acquired two freehold hotels in Japan for around S$178.5 million, which will provide a DPSS accretion of 1.6%.
Mapletree Pan Asia Commercial Trust (SGX: N2IU)
Mapletree Pan Asia Commercial Trust, or MPACT, is a retail and commercial REIT that owns 17 commercial properties across Singapore (4), Hong Kong (1), China (2), Japan (9), and South Korea (1).
These properties were valued at S$15.7 billion as of 31 December 2024.
MPACT saw its unit price slide 13.8% in the past year and touched a 52-week low of S$1.16.
The REIT reported a downbeat set of earnings for the first nine months of fiscal 2025 (9M FY2025) ending 31 December 2024.
Gross revenue fell 4.6% year on year to S$686 million while NPI tumbled 5.7% year on year to S$514 million.
DPU declined by 8.3% year on year to S$0.0607.
MPACT continued to maintain an occupancy of 90% across its portfolio and saw a positive rental reversion of 4.6%.
Shopper traffic at both VivoCity and Festival Walk improved by 0.4% and 3% year on year for 9M FY2025.
However, because of outbound travellers, tenant sales fell by 2.8% year on year for VivoCity and 9.3% year on year for Festival Walk.
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Disclosure: Royston Yang owns shares of Mapletree Industrial Trust, Frasers Logistics & Commercial Trust and Digital Core REIT.
