S-REITs Monthly Update: Opportunities Amid Market Volatility
UOB Kay Hian | April 1, 2025
Market Overview: Navigating Uncertainty
While trade conflicts and tariffs remain a threat, the recent series of weak economic numbers has led to lower US government bond yields. Many blue-chip S-REITs have already corrected and are trading at attractive yields of 6-7%. Maintain OVERWEIGHT on the sector.
Top Picks: Capitalizing on Diverse Opportunities
Buy Recommendations:
Retail REIT CICT (Target: S$2.37)
Data centre REIT DCREIT (Target: US$0.88)
Healthcare REIT PREIT (Target: S$4.85)
Diversified REIT CLAS (Target: S$1.38)
Key Highlights
GuocoLand Consolidates Ownership of 20 Collyer Quay GuocoLand has bought the top three floors of 20 Collyer Quay totalling 29,160sf for S$91.8m or S$3,148psf. The Grade A 999-year leasehold office building has a 96% occupancy rate and key tenants include BNP Paribas and The Work Boulevard.
KORE Proposes Trust Deed Amendments KORE has proposed to amend its trust deed to provide the manager with greater flexibility in determining distribution amounts, which may range from 0% to 100% of distributable income.
Unitholders to Vote on PGNREIT Privatization Independent Financial Advisor Prime Partners has advised Paragon’s independent directors to recommend that minority unitholders vote in favor of the S$0.98 per unit privatization scheme.
Sector Outlook and Strategy
The FSTREI corrected 4.8% in March but outperformed the STI’s 2.0% gain. Maintain OVERWEIGHT on the S-REIT sector, with a preference for retail, healthcare, hospitality, and office REITs.
Top S-REIT Picks
| Company |
Rec |
Share Price |
Target Price |
| CICT |
BUY |
S\$2.10 |
S\$2.37 |
| CLAS |
BUY |
S\$0.87 |
S\$1.38 |
| DCREIT |
BUY |
US\$0.53 |
US\$0.88 |
| PREIT |
BUY |
S\$4.15 |
S\$4.85 |
S-REIT Performance and Valuations
The FSTREI index corrected 4.8% in March but outperformed the broader market. Many S-REITs are trading at attractive yields of 6-7%.
Peer Comparison
A detailed comparison of key metrics across various S-REIT sub-sectors, including yield, P/NAV, and leverage ratios.
Top Outperformers and Underperformers
Recent share price movements, with Frasers Hospitality Trust, Frasers Logistics & Commercial Trust, and PLife REIT among the top outperformers, while overseas-exposed REITs like Digi Core REIT and IREIT Global were among the underperformers.
