The REIT sector is seeing some light at the end of the dark tunnel as interest rates ease and inflation cools.
Income investors will be pleased to know that more REITs are now reporting higher distributions.
Last week, we featured Keppel DC REIT (SGX: AJBU), Mapletree Industrial Trust (SGX: ME8U), OUE REIT (SGX: TS0U), and StarHill Global REIT (SGX: P40U), four Singapore REITs that managed to raise their distributions despite tough macroeconomic conditions.
Here are another three Singapore REITs that managed to beat the odds and declare higher payouts.
Sabana REIT (SGX: M1GU)
Sabana REIT is an industrial REIT that owns a diversified portfolio of 18 properties in Singapore.
The REIT’s assets under management (AUM) stood at more than S$1 billion as of 31 December 2024.
Sabana REIT reported a strong set of earnings for the second half of 2024 (2H 2024) and for the full year.
Gross revenue inched up 2.7% year on year for 2H 2024 to S$58.1 million.
The higher revenue was because of strong positive rental reversions across the portfolio.
Net property income (NPI) increased by 8.9% year on year to S$30.3 million.
Distribution per unit (DPU) shot up 32.2% year on year to S$0.0152.
For 2024, gross revenue was up 1.3% year on year while DPU grew 3.6% year on year to S$0.0286.
Sabana REIT’s portfolio occupancy stood at 85% as of 31 December 2024.
This level of occupancy was lower than the previous year’s 91.2% because of the repossession of properties at 33, 33A and 35 Penjuru Lane and 30 & 32 Tuas Avenue 8.
The former three units are being converted from a master lease to a multi-tenanted building where around 74% of the net lettable area (NLA) has been leased out.
The latter properties are undergoing a property reconfiguration.
What’s impressive is that Sabana REIT sustained four consecutive years of increasing positive rental reversion, starting at 10.5% for 2021 and ending with 20.6% for 2024.
The manager is also carrying out several asset enhancement initiatives (AEIs) on its portfolio of properties.
Examples include lift upgrading and modernisation at 34 Penjuru Lane and New Tech Park, as well as refurbishment works to upgrade the amenities at 123 Genting Lane and 39 Ubi Road, to name a few.
Sabana REIT has an aggregate leverage of 37.4% with an all-in cost of debt of 4.42%.
The REIT still has a debt headroom of S$120.6 million to conduct acquisitions.
AIMS APAC REIT (SGX: O5RU)
AIMS APAC REIT, or AAREIT, owns a portfolio of 28 industrial properties located in Singapore (25) and Australia (3).
The portfolio’s AUMs stood at around S$2.1 billion as of 31 December 2024.
AAREIT announced a resilient set of earnings for the first nine months of fiscal 2025 (9M FY2025) ending 31 December 2024.
Gross revenue increased by 5.7% year on year to S$139.1 million while NPI edged up 1.9% year on year to S$99.6 million.
DPU improved by 1.1% year on year to S$0.0707.
The industrial REIT boasted a high portfolio occupancy rate of 94.5% along with a strong positive rental reversion of 21.2% for 9M FY2025.
Aggregate leverage stood at just 33.7% along with a blended financing cost of 4.4%.
AAREIT has 70% of its debt pegged to fixed rates, thus mitigating a sharp increase in finance costs.
The REIT has two AEIs in progress now which will both be completed by 1Q FY2026.
The first is at 7 Clementi Loop and involves refurbishment works to meet the BCA Green Mark Gold certification and to ready the property for a new master tenant.
This project is 50% complete as of 31 December 2024.
The second is for 15 Tai Seng Drive and involves repositioning an industrial building to attract higher-value and hi-tech clients.
This second project is only 20% completed.
CapitaLand India Trust (SGX: CY6U)
CapitaLand India Trust, or CLINT, is an Indian property trust with a portfolio of 10 IT business parks, three industrial facilities, one logistics park, and four data centre developments.
CLINT’s portfolio AUM stood at S$3.7 billion as of 31 December 2024.
The REIT saw total property income for 2H 2024 climb 15% year on year to S$141.8 million.
NPI increased by 9% year on year to S$102.1 million.
DPU grew by 3% year on year to S$0.032.
On a full year basis, CLINT saw property income jump 19% year on year while DPU was up 6% year on year to S$0.0684.
CLINT’s portfolio enjoyed a high occupancy rate of 95% as of 31 December 2024.
The REIT’s gearing stood at 38.5% with a cost of debt of 6%.
Around 73.3% of its loans are hedged to fixed rates and the REIT has a debt headroom of around S$1 billion before it hits the 50% ceiling.
The REIT’s long-term growth strategy is to tap into its development pipeline in Bangalore, Hyderabad, and Chennai.
It will also focus on data centre developments in India and make forward purchases to develop properties within the country.
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Disclosure: Royston Yang owns shares of Keppel DC REIT and Mapletree Industrial Trust.