2023 marked a better year for Singapore REITs, as compared to the challenging time in 2022. More than 50% of REITs achieved positive returns, a big jump from only 5 the year before, albeit mainly due to the starting share prices being lower for comparison this time. Throughout the year, the fed rate went up a bit from 4.25% - 4.5% to 5.25% - 5.5%. In the December FOMC meeting, the Fed signaled 3 rate cuts in 2024, after which, share prices have rallied. This could mean better times ahead and bring some hope for those investing in Singapore REITs.
Overall Returns
Let's take a look at the overall returns from the graph below, including Business Trust - CapitaLand India Trust. Note that the dividend is based on the ex-dividend date.
The return is better for 2023, with slightly more than half achieving positive returns. But, 5 counters are losing more than 20%, and all 5 are having 100% of their assets outside of Singapore. Next, let's look at the detailed table breakdown:
The average dividend is at 6.65% (based on ex-dividend date) and the average capital loss is at -7.71%, total at -1.06%. In terms of median figures, the median dividend stands at 6.37%, the median capital loss is at -5.33%, and the median total return is at 1.49%.
Next, let's check out how MCFK counters perform in 2023?
For MCFK counters, the average dividend is at 6.24% (based on ex-dividend date) and the average capital gain is at 1.3%, a total of 7.54%. The dividend yield is slightly lower but the total return is better than the average of 39 counters because of the capital gain. In terms of median, the median dividend is at 5.78%, the median capital gain is at 1.59% and the median total return is at 7.97%.
Ranking
Top 10 Highest Returns
- 6 are MCFK counters
- 2 pure data center REITs are on the list
- 5 are industrial REITs (Mapletree Logistics Trust is excluded)
Top 10 Lowest Returns
- All 3 U.S. office REITs are on the list
- 8 counters have no assets in Singapore
- 6 are office-focused REITs
Statistics for Returns
| Total Return, % | Qty |
|---|---|
| > 15% | 7 |
| > 10% to 15% | 5 |
| > 5% to 10% | 5 |
| > 0% to 5% | 4 |
| > -5% to 0% | 5 |
| > -10% to -5% | 6 |
| > -15% to -10% | 2 |
| <=15% | 5 |
More than half achieved positive returns this time. 5 counters are losing more than 20%.
Author's Opinion
The rate hike progressed slowly throughout the year and remained at 5.25% - 5.5% since the July hike. Fortunately, in the December FOMC meeting, the Fed signaled the potential for 3 rate cuts in 2024. This news notably boosted the share prices of most Singapore REITs. I hope this marks the end of the challenging phase for REITs.
As a side note, due to challenges in accurately updating the YTD return tab on the SREITs Data page, especially those with advanced distributions due to equity fundraising, I've decided to remove it moving forward.
Wishing everyone a Happy New Year.
For more information, check out:
SREITs Dashboard - Detailed information on individual Singapore REIT
SREITs Data - Overview and details of Singapore REIT
REIT Review - List of previous REIT review posts
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*Disclaimer: The information presented on this blog is for educational and informational purposes only. The materials, including research and opinions, are based solely on my findings and should not be considered professional financial advice or a definitive statement of fact. I cannot guarantee the accuracy, completeness, or reliability of the information provided. I shall not be held liable for any errors, omissions, or losses that may occur as a result of using the information presented on this blog. It should be noted that the information presented on this blog does not constitute a buy, sell, or hold recommendation for any security. It is crucial to conduct your own thorough research and due diligence before making any investment decisions.
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