Best performing S-REITs post double digit total returns in H1

SGX_Stars
06-30

The S-REIT sector has delivered a stable performance in the first half of 2025, with the iEdge S-REIT index gaining 0.6% to 1010.73 as of Jun 26, while dividends take the index total returns to 3.2% for the period. 

More than half of the 30 constituents on the iEdge S-REIT index delivered positive total returns in the first six months of the year, with the top five performers delivering double digit total returns over the period.

These outperformers include $Frasers HTrust(ACV.SI)$ (FHT), $CapLand IntCom T(C38U.SI)$ (CICT), $First Reit(AW9U.SI)$ , $Frasers Cpt Tr(J69U.SI)$ (FCT) and $ParkwayLife Reit(C2PU.SI)$ , with YTD total returns ranging between 10.0% and 21.4% as of Jun 26.

Most of the outperformers in the first half reported robust operating performance with stable occupancy and positive rental reversions.

1. $Frasers Cpt Tr(J69U.SI)$

FCT saw revenue and net property income (NPI) grow by 7.1% and 7.3% on year to S$184.4 million and S$133.7 million respectively in H1 2025. This growth was primarily driven by increased occupancy and passing rent across its portfolio of malls, and the completion of AEIs at Tampines 1. Distribution per unit (DPU) also grew 0.5% to S$0.06054.

2. $ParkwayLife Reit(C2PU.SI)$

Similarly, ParkwayLife REIT has reported higher gross revenue in 1Q 2025, arising from the contribution of nursing homes acquired in Japan and France. DPU also rose 1.3% to S$0.0384.

3. $CapLand IntCom T(C38U.SI)$

On a like-for-like basis, CICT also saw growth in Q1 gross revenue and NPI by 1.1% and 1.4% respectively, and it continued to observe higher signing rents for new and renewed leases.

Meanwhile, FHT’s outperformance has come on the back of a proposed privatisation.

The REIT sector trades at compelling valuations compared to their historical average. 

As of end-May, the forward dividend yield for the FTSE ST REIT Index was around 6.4%, representing a yield spread of nearly 4 percentage points to benchmark 10-year Singapore Government Bond yields, higher than the 10-year average. 

In terms of price-to-book ratio, the sector also trades under 0.8x, below the 10-year average of 1.0x. The strongest performing S-REITs on the iEdge S-REIT index in the first half of 2025 are also among those that have the highest price-to-book ratios currently.

The top seven performers in H1 have price-to-book ratios of between 1.0x to 1.7x, higher than the sector average.

For the first half of 2025, retail investors were net buyers of S-REITs, with the sector receiving total net inflow of around S$400 million as of June 26.

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