S-REITs maintain pockets of resilience despite headwinds in H1
Singapore Real Estate Investment Trusts (S-REITs) trailed the broader Singapore market in the first half of 2026 amid a backdrop of higher bond yields, elevated oil prices and ongoing geopolitical uncertainty. Even so, there were still pockets of resilience within the sector, with nine S-REITs recording positive total returns for the year-to-date.
The iEdge S-REIT Index recorded a total return of -3.9% year-to-date, compared with 13.7% total return for the Straits Times Index over the same period. Investors were more cautious as they assessed the interest rate outlook, with the US Federal Reserve maintaining its benchmark rate at 3.5–3.75% in June.
Analysts from DBS Group Research noted in July that most investors recognise that valuations for S-REITs remain attractive, at around 0.9 times price-to-book ratio, even as sentiment remains cautious as macro factors continue to overshadow resilient real estate fundamentals.
$AIMS APAC Reit(O5RU.SI)$ led the iEdge S-REIT index outperformers with a total return of 10.3%. AIMS APAC REIT recorded 2.2% revenue growth and 5.7% net property income growth to S$190.7 million and S$141.3 million respectively in FY26, and DPU increased 2.6% to 9.85 Singapore cents. DBS Group Research analyst Dale Lai expects positive operating performance to continue, supported by strong operating metrics, and sees further growth in organic income driven by proactive portfolio management.
In term of fund flows, retail investors were net buyers of approximately S$1 billion worth of S-REITs in the year to date, while institutional investors were net sellers of a similar amount. Against this backdrop, AIMS APAC REIT stood out as one of the few REITs to record net institutional inflows, attracting inflows of about S$18 million.
Another REIT that has attracted institutional interest is $Cent Accom REIT(8C8U.SI)$ (CAREIT). CAREIT recorded net institutional inflows year-to-date and recently saw global real estate investment manager Cohen & Steers become a substantial unitholder after increasing its deemed interest from 4.995% to 5.004% on 2 July.
Analysts have also highlighted CAREIT's long-term growth potential. In May, CGS International Research analysts Li Jialin and Lock Mun Yee noted CAREIT's growth runway, highlighting that 3,112 additional beds had been added through Westlite Toh Guan, Westlite Mandai and the acquisition of EPIISOD Macquarie Park in Sydney. The analysts added that CAREIT could further increase its operational purpose-built worker accommodation (PBWA) bed count through the Westlite Mandai Expanded Capacity project, which is pending approval under the Foreign Employee Dormitories Act.
Looking ahead, market observers remain selective on the sector. Beansprout analyst Gerald Wong noted that segments such as Singapore office, data centres and purpose-built accommodation continue to benefit from relatively stable demand, while REITs with overseas assets that actively manage currency risks may be better positioned. He added that investors may wish to focus on REITs with clear distribution growth drivers, such as $CapLand India T(CY6U.SI)$ , $DigiCore Reit USD(DCRU.SI)$ and $Stoneweg EUTrust SGD(SEB.SI)$ , while AIMS APAC REIT and $ParkwayLife Reit(C2PU.SI)$ continue to offer defensive income resilience.
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