The REIT sector is at a crossroads now.
Having endured higher costs because of inflation and surging interest rates, investors are now fretting over the sector’s future as the US Federal Reserve hesitates to cut rates.
Despite this uncertainty, the retail REIT sector continues to churn out dependable distributions, supported by healthy consumer spending.
Income investors who are looking for good yields can consider these five retail REITs.
Frasers Centrepoint Trust (SGX: J69U)
Frasers Centrepoint Trust, or FCT, is a retail REIT with a portfolio of nine retail suburban malls and an office building.
As of 31 March 2025, FCT’s portfolio is valued at around S$7.1 billion.
The retail REIT reported an encouraging set of earnings for its first half of fiscal 2025 (1H FY2025) ending 31 March 2025.
Gross revenue rose 7.1% year on year to S$184.4 million while net property income (NPI) improved by 7.3% year on year to S$133.7 million.
Distribution per unit (DPU) inched up 0.5% year on year to S$0.06054.
With an annualised DPU of S$0.12108, shares of FCT provide a forward distribution yield of 5.5%.
The REIT’s portfolio is anchored by a strong retail occupancy rate of 99.5%.
Demand for its retail spaces was also high, as evidenced by the positive rental reversion of 9% for 1H FY2025.
Both tenant sales and footfall were healthy, registering increases of 3.3% and 1% year on year, respectively.
FCT has embarked on its latest asset enhancement initiative (AEI) of Hougang Mall, with phased works targeted to be completed by the third quarter of 2026 (3Q 2026).
Lendlease Global Commercial REIT (SGX: JYEU)
Lendlease Global Commercial REIT, or LREIT, is a retail cum commercial REIT with a portfolio of three assets.
In Singapore, LREIT owns Jem Mall and an office building, along with 313 @ Somerset, a retail mall along Orchard Road.
Over in Milan, Italy, the REIT owns Sky Complex, which comprises three grade A office buildings. These buildings have a total appraised value of around S$3.7 billion as of 30 June 2024.
Back on 31 December 2024, LREIT reported a downbeat set of earnings as higher finance costs ate into its distributable income.
For 1H FY2025 ending 31 December 2024, gross revenue and NPI fell by 13.6% and 19.8% year on year, respectively.
The key reason was because of the upfront recognition of supplementary rent received from the restructuring of Sky Complex in 1H FY2024.
DPU tumbled 14.3% year on year to S$0.018.
At an annualised DPU of S$0.036, LREIT’s units offer a prospective distribution yield of 6.9%.
During LREIT’s recent business update for its third quarter of fiscal 2025 (3Q FY2025), portfolio committed occupancy stood at 92.1%.
Retail rental reversion also came in strong at 10.4%, with the tenant retention rate coming in at nearly 88%.
Starhill Global REIT (SGX: P40U)
Starhill Global REIT, or SGREIT, is a retail and office REIT with a portfolio of nine properties in Singapore, Australia, Malaysia, Japan, and China.
These properties were valued at S$2.8 billion as of 31 March 2025.
SGREIT reported a commendable set of earnings for 1H FY2025 ending 31 December 2024.
Gross revenue inched up 1.7% year on year to S$96.3 million while NPI improved by 1.6% year on year to S$75.6 million.
DPU edged up 1.1% year on year to S$0.018.
With an annualised DPU of S$0.036, shares of SGREIT offer a prospective distribution yield of 7%.
For 3Q FY2025, SGREIT’s committed portfolio occupancy stood at 97.4%.
Gearing was also a moderate 36.6% and around 83% of the REIT’s debt is hedged to fixed rates.
Sasseur REIT (SGX: CRPU)
Sasseur REIT owns a portfolio of four retail outlet malls in China, located in Chongqing (2), Hefei (1), and Kunming (1).
For 2024, Sasseur REIT reported a 0.9% year-on-year increase in total rental income to RMB 664.1 million.
However, DPU fell by 2.7% year on year to S$0.06082 because of a higher amount retained.
At Sasseur REIT’s last traded unit price of S$0.64, its units offer a trailing distribution yield of 9.5%.
For the first quarter of 2025 (1Q 2025), outlet sales across the REIT’s malls dipped by 0.9% year on year to RMB 1.25 billion.
Despite this, rental income rose 1.6% year on year to RMB 175.4 million, supported by the fixed rental component that saw a 3% year-on-year increase.
In S$ terms, however, rental income dipped by 0.2% year on year because of foreign exchange weakness.
Sasseur REIT has one of the lowest gearing levels of all the S-REITs at just 24.8%, giving it a sizable debt headroom of S$895 million for yield-accretive acquisitions.
United Hampshire US REIT (SGX: ODBU)
United Hampshire US REIT, or UHREIT, owns 19 predominantly freehold grocery and necessity-based properties along with two self-storage properties.
These properties are valued at approximately US$731 million.
2024 saw a mixed result from the REIT.
Gross revenue increased by 1.4% year on year to US$73.2 million, but NPI dipped by 1.7% year on year to US$49.8 million.
DPU slid 15.2% year on year to US$0.0406.
At US$0.46, UHREIT’s units offer a trailing distribution yield of 8.8%.
For 1Q 2025, the retail REIT continued to report strong operating numbers.
Its grocery properties enjoyed a high occupancy rate of 97.2% while its self-storage properties’ occupancy stood at 93.6%.
The portfolio also saw a high tenant retention rate of 89%.
UHREIT had a low gearing of just 36.8% with no loans maturing until November 2026.
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Disclosure: Royston Yang does not own shares in any of the companies mentioned.
