SREITs Fundamental Review @ 22 December 2020

Update: 25 Dec 2020

Market cap for Capitaland Integrated Commercial Trust should be around S$ 13.8 Billion, instead of S$ 7.897 as shown below.

* Above is extracted from SREITs Data

** Ascendas India Trust and Dasin Retail Trust are Business Trust

*** Eagle Hospitality Trust is suspended and would be excluded for statistics below.

Dividend Yield

Items	Average	Median	Min	Max
Dividend Yield - Healthcare	8.43%	8.43%	3.54%	13.32%
Dividend Yield - Retail	5.95%	5.29%	3.26%	11.23%
Dividend Yield - Office	6.62%	6.68%	3.61%	8.8%
Dividend Yield - Hospitality	3.74%	4.14%	2.64%	4.46%
Dividend Yield - Industrial	4.84%	4.44%	3.09%	7.4%
Dividend Yield - Logistics	6.79%	7.23%	4.16%	8.53%
Overall	6.02%	5.29%	2.64%	13.32%

* Based on REIT Major Sector

	Highest Div. Yield	%	Lowest Div. Yield	%
1	First REIT	13.32%	Frasers Hospitality Trust	2.64%
2	Lippo Malls Indonesia Retail Trust	11.23%	Keppel DC REIT	3.09%
3	United Hampshire US REIT	9.31%	ARA US Hospitality Trust	3.13%
4	Prime US REIT	8.8%	SPH REIT	3.26%
5	Keppel Pacific Oak US REIT	8.75%	Parkway Life REIT	3.54%

Key Financial Metrics

Items	Unit	Average	Median	Min	Max
Price/ NAV	time	0.97	0.88	0.42	2.38
Market Cap, B	S$	2.52	1.42	0.21	13.85
Property Yield (Annualized)	%	5.11	5.28	0.89	8.21
Management Fees over Distribution	%	16.66	14.71	7.74	39.19
Distribution on Capital (Annualized)	%	3.32	3.21	1.19	5.39
Distribution Margin	%	45.26	48.4	7.77	70.14

* SREITs in Foreign Currencies converted to SGD for Market Cap Comparison

	Highest P/NAV	time	Lowest P/NAV	time
1	Keppel DC REIT	2.38	Lippo Malls Indonesia Retail Trust	0.42
2	Parkway Life REIT	1.97	First REIT	0.42
3	Mapletree Industrial Trust	1.68	Starhill Global REIT	0.61
4	Mapletree Logistics Trust	1.64	ARA US Hospitality Trust	0.61
5	Ascendas REIT	1.36	OUE Commercial REIT	0.62

Lease Profile

Items	Unit	Average	Median	Min	Max
Committed Occupancy	%	94.94	96.05	80.2	100
Income Received in SGD/Major Currencies	%	78.41	100	0	100
Highest Lease Maturity in 5 Years	%	35.58	31.8	0	100
Weighted Average Lease Expiry, WALE	year	4.58	4	1.1	13.7
Weighted Average Land Lease Expiry	year	66.5	70.2	23.41	99

• Sabana REIT and Lippo Malls Indonesia Retail Trust are having committed occupancy of less than 90%. 
• 8 SREITs are having 0% of income received in SGD/major currencies.
• ARA Hospitality Trust, EC World REIT and Sasseur REIT are having the highest lease maturity within 5 years of more than 70% in a single year.
• CapitaLand Integrated Commercial Trust, CapitaLand Retail China Trust, Sasseur REIT and Frasers Centrepoint Trust are having WALE of less than 2.5 years.
• BHG Retail REIT, CapitaLand Retail China Trust, Dasin Retail Trust and ESR REIT are having weighted average land lease expiry of less than 30 years.

Debt Profile

Items	Unit	Average	Median	Min	Max
Interest Coverage Ratio	time	4.6	3.9	1.5	17
Cost of Debt	%	2.88	2.77	0.54	5.53
Fixed Debt over Total Debt	%	72.32	80	0	100
Unsecured Debt over Total Debt	%	58.41	75.6	0	100
Gearing Ratio	%	36.77	36.8	27.8	43
Highest Debt Expiry in 5 Years	%	40.22	31.3	13.75	100
Weighted Average Debt Expiry, WADE	year	2.89	2.9	1.26	4.7

• ARA Hospitality Trust, BHG Retail REIT, Dasin Retail Trust and Frasers Hospitality Trust are having interest coverage ratio of less than 2.5 times. 
• Ascendas India Trust, Dasin Retail Trust and Lippo Malls Indonesia Retail Trust are having cost of debt of more than 5%.
• Dasin Retail Trust, First REIT, Sasseur REIT and SPH REIT are having fixed debt % of less than 50%.
• 12 SREITs are having unsecured debt of 0%.
• The 5 SREITs with the highest gearing ratio are ARA Hospitality Trust @ 43%, Lippo Malls Indonesia Retail Trust @ 42.5%, ESR-REIT @ 41.6, Suntec REIT @ 41.5% and ARA LOGOS Logistics Trust @ 40.5%. 
• BHG Retail REIT, EC World REIT, Elite Commercial REIT, Lendlease Global Commercial REIT and Sasseur REIT are having the highest debt maturity within 5 years of more than 75% in a single year.
• BHG Retail REIT, First REIT and Sabana REIT are having WADE of less than 1.5 years.

Diversification Profile

Items	Unit	Average	Median	Min	Max
Major Sector Contribution	%	84.71	94.74	39.52	100
2nd Sector Contribution	%	11.66	4.09	0	45.8
3rd Sector Contribution	%	3.26	0	0	26.12
Top Geographical Contribution	%	59.55	56.28	9.1	100
Top Property Contribution	%	25.16	21.47	4.52	66.36
Top Tenant Contribution	%	20.07	10.6	3.2	100
Top 10 Tenants Contribution	%	48.29	37.72	17.56	100

• 16 SREITs are having major sector contribution of 100%.
• 15 SREITs are having top geographical contribution of more than 75%.
• BHG Retail REIT, Lendlease Global Commercial REIT, SPH REIT and Suntec REIT are having top property contribution of more than 50%.
• ARA Hospitality Trust, Elite Commercial REIT, FIRST REIT and Parkway Life REIT are having top tenant contribution of more than 50%.
• 10 SREITs are having top 10 tenants contribution of more than 75%.

Financial Engineering/Income Support and Distribution from Asset Disposal 

Name	Support / Distribution	Disposal / Distribution
ARA LOGOS Logistics Trust		4.1%
Ascendas REIT	1.8%
Ascott Residence Trust		22.6%
BHG Retail REIT	4.8%
CDL Hospitality Trusts		9%
Cromwell European REIT		3%
Dasin Retail Trust	29.6%
ESR-REIT		5.4%
Frasers Logistics & Commercial Trust		2.7%
Keppel DC REIT	2.6%
Keppel REIT		9.9%
Lippo Malls Indonesia Retail Trust	9.4%
Mapletree Logistics Trust		6.1%
OUE Commercial REIT	13.4%
Soilbuild Business Space REIT	1.3%
Suntec REIT	2%	3.1%
United Hampshire US REIT	12.6%

Generally, SREITs are undervalued in terms of Price/NAV with the median at 0.87. The median dividend yield of 5.29% is attractive in view of the current low interest rate environment. However, note that both DPU and NAV are lagging figures. SREITs result announcement for 4Q 2020 is around the corner, you could refer to SREITs Result Date page in which I would update the result announcement date as and when available.