4 Resilient Singapore REITs with Distribution Yields of 5.4% or Higher


The REIT sector has been negatively impacted by inflation and a surge in interest rates over the past 18 months.

Despite this, the asset class continues to be an important source of dividends for income investors.

REIT managers are taking steps to mitigate the impact of higher expenses and finance costs.

Here are four resilient Singapore REITs sporting distribution yields of 5.4% or more.

Frasers Centrepoint Trust (SGX: J69U)

Frasers Centrepoint Trust, or FCT, is a retail REIT with a portfolio of nine retail malls and an office building, all located in the suburban regions of Singapore.

Its assets under management (AUM) were approximately S$6.5 billion as of 30 September 2023.

The retail REIT pulled off a respectable performance for its fiscal 2023 (FY2023) ending 30 September.

Gross revenue rose 3.6% year on year to S$369.7 million while net property income (NPI) inched up 2.7% year on year to S$265.6 million.

Distribution per unit dipped slightly by 0.6% year on year to S$0.1215, giving FCT’s units a trailing distribution yield of 5.4%.

The REIT reported robust performance metrics for its recent fiscal 2024 first-quarter business update.

Committed occupancy stood high at 99.9% with shopper traffic rising by 3.1% year on year.

The REIT manager also carried out mall rejuvenation for Tiong Bahru Plaza and Northpoint City North Wing.

Last month, FCT announced the purchase of an additional 24.5% stake in NEX Mall in Serangoon, taking its effective stake up to 50%.

Mapletree Industrial Trust (SGX: ME8U)

Mapletree Industrial Trust, or MIT, is an industrial REIT with a portfolio of 56 properties in the US, 85 in Singapore, and one in Japan.

Its AUM stood at S$9.2 billion as of 31 December 2023.

Like FCT, MIT also pulled off a resilient performance for its recent fiscal 2024 third quarter (3Q FY2024) result.

Gross revenue rose 2% year on year to S$173.9 million while NPI edged up 0.8% year on year to S$129.9 million.

DPU slipped by 0.9% year on year to S$0.0336, bringing the trailing 12-month DPU to S$0.134.

At S$2.45, MIT’s units provide a trailing distribution yield of 5.5%.

The REIT’s occupancy rate stood high at 92.6% as of 31 December 2023 with an aggregate leverage of 38.6%.

Close to 80% of the REIT’s loans are hedged to fixed rates.

The industrial REIT also reported a positive rental reversion of 7.2% for renewal leases across its portfolio.

Keppel DC REIT (SGX: AJBU)

Keppel DC REIT is a data centre REIT with a portfolio of 23 data centres across nine countries.

The REIT’s AUM stood at S$3.7 billion as of 31 December 2023.

Keppel DC REIT reported a mixed set of earnings for 2023 with distributable income dragged by a loss provision for one of its tenants.

Gross revenue for 2023 rose 1.4% year on year to S$281.2 million but NPI dipped by 3% year on year to S$245 million because of around 5.5 months of loss allowance for its Guangdong data centres.

DPU fell by 8.1% year on year to S$0.09383, giving the data centre REIT’s units a trailing distribution yield of 5.6%.

Assuming the tenant paid up on time, DPU would have been S$0.10032 for a decline of just 1.8% year on year.

Despite this setback, Keppel DC REIT’s portfolio occupancy stood high at 98.3% with a long portfolio weighted average lease expiry of 7.6 years.

Its portfolio valuation also improved slightly from S$3.59 billion in 2022 to S$3.6 billion in 2023.

The outlook for the data centre sector remains bright as data centre demand will be driven by cloud computing, artificial intelligence, and the Internet of Things.

Mapletree Logistics Trust (SGX: M44U)

Mapletree Logistics Trust, or MLT, is an industrial REIT with a portfolio of 187 properties across eight countries.

The logistics REIT’s AUM stood at S$13.3 billion as of 31 December 2023.

MLT reported an upbeat set of earnings for 3Q FY2024 with gross revenue rising 2.1% year on year to S$184 million.

NPI inched up 1.5% year on year to S$159.5 million while DPU crept up 1.2% year on year to S$0.02253.

For the first nine months of fiscal 2024 (9M FY2024), DPU improved by 0.7% year on year to S$0.06792.

MLT’s trailing 12-month DPU stood at S$0.0906, giving its units a trailing 12-month distribution yield of 5.8%.

The logistics REIT has completed more than S$900 million of acquisitions year-to-date in countries such as Japan, Australia, India, and South Korea.

A total of eight divestments were conducted across Malaysia, Singapore, and Japan, with all properties transacted at a premium to their valuations.

MLT ended 2023 with a gearing ratio of 38.8% and an average cost of debt of 2.5%.

The REIT also had 83% of its loans hedged to fixed rates.

Want more dividends in 2024? Our latest FREE report spotlights five Singapore REITs with distribution yields of 5.5% or more, a rare find in today’s market. These are reliable, proven performers. Just one stock inside could boost your portfolio’s returns in the next few months. Download your report today and start reaping the benefits.

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Disclosure: Royston Yang owns shares of Mapletree Industrial Trust and Keppel DC REIT.





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