Singapore - Comm Properties & REITS 03 (Feb 19 - Dec 26)

[behappyalways]

REITs defy downturn on tight office supply
https://sbr.com.sg/commercial-property/ ... ice-supply

[behappyalways]

Tight office supply props up CBD office rents in 3Q2019
https://www.edgeprop.sg/property-news/t ... nts-3q2019

[behappyalways]

Warehouse rents extend steep decline in Q2
https://sbr.com.sg/transport-logistics/ ... line-in-q2

[behappyalways]

S’pore Reit’s shares fall after Hong Kong mall attacked by protesters
https://mothership.sg/2019/11/singapore ... ng-centre/

[winston]

not vested

LET'S GO WITH THE BIG GUNS

- DPU grew 1.2% YoY in 3Q19

- Go for quality amid pullback

- Top picks: AREIT SP, CT SP, SUN SP

Most of the REITs under our coverage reported an in-line set of 3QCY19 results.

Looking ahead, we are projecting stable DPU growth of 1.2% (market-cap weighted) for the current financial year (FY19/20F).

This is expected to accelerate to +4.0% for the next financial year (FY20/21F).

While the S-REITs sector has been in vogue this year, the FTSE ST REIT Index saw a sudden correction of 2.3% on 8 Nov 2019.

This was the largest single-day decline for the sector since 24 Aug 2015 (-3.8%).

While there has been some optimism over the Sino-US trade situation and signs of
stabilisation in the macroeconomic outlook, we believe lingering uncertainties would
remain.

We maintain NEUTRAL on S-REITs, but with a bias to the upside given the recent correction, which has given rise to selective bargain hunting opportunities for some high quality S-REITs which were previously rated ‘Hold’.

We thus add Ascendas REIT (AREIT SP) [BUY; FV: S$3.25] and CapitaLand Mall Trust (CT SP)
[BUY; FV: S$2.73] to our top S-REIT picks alongside Suntec REIT (SUN SP) [BUY; FV: S$2.05]
but remove Keppel DC REIT (KDCREIT) and Mapletree North Asia Commercial Trust (MAGIC SP).

Source: OCBC

[behappyalways]

JTC rejects bids for industrial site at Tampines North Drive 5
https://www.edgeprop.sg/property-news/j ... th-drive-5

[behappyalways]

Chart of the Day: Industrial property supply to hit 26.2 million sqft by 2022
https://sbr.com.sg/commercial-property/ ... -sqft-2022

[behappyalways]

Chart of the Day: Here are the priciest strata office deals in 2019
https://sbr.com.sg/commercial-property/ ... ls-in-2019

[winston]

not vested

March 27, 2020

Singapore REITs – Firing another much needed bazooka

On the real estate front, the government came up with an enhanced property tax rebate of 100% (previously 15-30% during Budget 2020) for the year 2020 for qualifying hospitality and retail properties, and also introduced a property tax rebate of 30% for other non-residential properties such as offices and industrial premises.

Although S-REIT valuations look attractive (yield spread of 576 bps which is 2.8 standard deviations above 10-year mean), we believe volatility in share prices is likely to continue, and downside risks to ours and the street’s DPU forecasts remain.

We thus remain selective in our picks, with a preference for government-linked REITs with strong sponsors, such as:-
1. Ascendas REIT (AREIT SP) [BUY; FV: S$3.59]
2. CapitaLand Mall Trust (CT SP) [BUY; FV: S$2.90]
3. Mapletree Industrial Trust (MINT SP) [BUY; FV: S$2.87]
4. Mapletree Commercial Trust (MCT SP) [BUY; FV: S$2.44] and
5. Mapletree North Asia Commercial Trust (MAGIC SP) [BUY; FV: S$1.37]

Source: OCBC

[winston]

REITs ‒ Singapore
Office REITs: Sturdy And Resilient

While demand for office space is affected by a slowdown in the broader economy, we expect office REITs to be more resilient relative to retail REITs and hospitality REITs.

Upgrade to OVERWEIGHT.

Maintain BUY for premier Grade-A office landlord CCT (Target: S$1.70).

Upgrade KREIT to BUY (Target: S$1.30). KREIT’s share price has corrected 24.2% ytd and 2020F distribution yield has improved to 6.0%. Contribution from 311 Spencer Street at Melbourne will kick in starting 2Q20.

Source: UOBKH

https://research.uobkayhian.com/content ... 3c5d81ade8