Deep Dive into Top Picks
CDL Hospitality Trusts (CDLHT)
CDLHT is Singapore’s first listed hospitality trust with a diversified portfolio of 20 properties valued at SGD 3 billion, including hotels, apartments, and a mall. The trust benefits from its strong sponsor, Millennium & Copthorne Hotels, which owns over 145 hotels globally. CDLHT is poised to benefit from the recovery in visitor arrivals and corporate travel, particularly from China.
Key Metrics:
- DPU Yield: 6.4%
- Price-to-Book Ratio: 0.59x
- Historical Mean P/B Ratio: 1.05x
Risks include higher interest rates, slower-than-expected tourist arrivals, and limited capital recycling. However, CDLHT presents an attractive valuation and is recommended as a BUY.
CapitaLand Integrated Commercial Trust (CICT)
CICT is Singapore’s largest REIT by market capitalization and assets, with over 90% of its revenue derived from local assets. The trust offers a mix of organic growth and stability through positive rent reversions and a long lease expiry profile.
Key Metrics:
- DPU Yield: 5.5%
- Price-to-Book Ratio: 0.94x
- Historical Mean P/B Ratio: 1.18x
Risks include weaker retail sales, structural vacancy in offshore offices, and potential dilution from mergers and acquisitions. CICT is recommended as a BUY for its strong balance sheet and defensive nature.
CapitaLand Ascendas REIT (CLAR)
CLAR is the largest industrial REIT in Singapore, with exposure to high-value industries like tech, logistics, and life sciences. The trust’s diversified asset and tenant base provides stability and growth opportunities.
Key Metrics:
- DPU Yield: 5.7%
- Price-to-Book Ratio: 1.13x
- Historical Mean P/B Ratio: 1.26x
Challenges include vacancy risks in older business parks and valuation pressures on offshore assets. However, CLAR’s strong credit profile and exposure to high-growth sectors make it a BUY.
The Ascott Limited (CLAS)
CLAS is Asia Pacific’s largest hospitality trust, managing over 18,000 units across serviced residences, hotels, and rental housing. It benefits from a strong sponsor, Ascott, with a global footprint and diverse asset mix.
Key Metrics:
- DPU Yield: 6.2%
- Price-to-Book Ratio: 0.79x
- Historical Mean P/B Ratio: 0.86x
Risks include FX volatility, slower recovery in China, and potential challenges in the US student accommodation market. CLAS is recommended as a BUY for its diversified portfolio and active capital recycling.
Far East Hospitality Trust (FEHT)
FEHT is a pure-play Singapore hospitality trust with a mix of hotels and serviced residences. The trust offers stable distributions through its master lease structure and a lowly geared balance sheet.
Key Metrics:
- DPU Yield: 5.9%
- Price-to-Book Ratio: 0.66x
- Historical Mean P/B Ratio: 0.77x
Risks include sensitivity to interest rate movements and limited opportunities for accretive acquisitions. FEHT is recommended as a BUY for its stable profile and growth potential.
Lendlease Global Commercial REIT (LREIT)
LREIT is a Singapore-centric commercial REIT with high-yielding retail malls and master-leased office assets. The trust benefits from a supportive sponsor and secured debt refinancing.
Key Metrics:
- DPU Yield: 6.9%
- Price-to-Book Ratio: 0.74x
- Historical Mean P/B Ratio: 0.87x
Risks include weaker retail sales and valuation pressures on offshore office assets. LREIT is recommended as a BUY for its attractive valuation and high yield.
Mapletree Industrial Trust (MINT)
MINT is a dominant industrial landlord in Singapore with a mandate to invest in data centers globally. Its portfolio is well-diversified across Singapore, the US, and Japan.
Key Metrics:
- DPU Yield: 6.0%
- Price-to-Book Ratio: 1.22x
- Historical Mean P/B Ratio: 1.32x
Risks include vacancy in US data centers and higher utilities costs. MINT is recommended as a BUY for its robust portfolio and growth potential.
Mapletree Logistics Trust (MLT)
MLT is a leading logistics landlord with a Pan-Asia presence. It benefits from structural tailwinds like e-commerce growth and shifting supply chains.
Key Metrics:
- DPU Yield: 6.6%
- Price-to-Book Ratio: 0.87x
- Historical Mean P/B Ratio: 1.13x
Challenges include FX volatility and potential headwinds from new supply. MLT is recommended as a BUY for its steady execution and regional network.
OUE Commercial REIT (OUEREIT)
OUEREIT is a high-yielding pure-play Singapore REIT with a mix of CBD offices and hotels. The trust has improved its credit profile significantly and is actively recycling capital.
Key Metrics:
- DPU Yield: 6.9%
- Price-to-Book Ratio: 0.48x
- Historical Mean P/B Ratio: 0.65x
Risks include slower tourist arrivals and potential valuation pressures. OUEREIT is recommended as a BUY for its attractive valuation and high yield.
