Discover SGX’s S-REITs: Dividend Rewards and Long-Term Investing

October 24, 2023

As we advance in our insightful “Discover SGX” series, having unfolded various aspects such as risk management, hedging, and diverse dividend avenues, this chapter brings into focus a key player in the dividend landscape – Singapore Real Estate Investment Trusts (S-REITs).

Singapore is one of Asia’s largest REIT and property trust markets.

S-REITs are distinguished for their potential to offer lucrative dividend yields and foster long-term investment growth, making them a significant attraction on the SGX platform.

Overview of S-REITs

S-REITs provide investors with the opportunity to invest in a diverse range of real estate assets.

They are mandated to distribute at least 90% of their taxable income to shareholders, which results in attractive and consistent dividend yields.

Furthermore, the diverse types of S-REITs available on SGX, spanning sectors such as commercial, industrial, retail, and hospitality, allow investors to diversify their portfolios and manage risk effectively.

In Singapore, there are 42 REITs and property trusts with a combined market capitalisation of S$96 billion, representing about 12% of Singapore’s overall listed stocks.

Dividend Potential

One of the most compelling features of S-REITs is their potential to provide investors with a steady stream of income through dividends.

Due to the regulatory distribution requirements and the typically stable nature of real estate assets, S-REITs have become synonymous with reliable dividends, catering to income-focused investors.

Long-Term Investment Growth

Beyond dividends, S-REITs also offer the prospect of long-term capital appreciation.

As real estate values generally increase over time, and with prudent asset management, S-REITs can deliver growth in net asset value, contributing to the overall returns for investors.

Navigating S-REITs Investment

When exploring S-REITs on SGX, investors should consider various factors such as the trust’s property portfolio, management quality, occupancy rates, lease expiry profiles, and gearing ratio.

These indicators help in assessing the sustainability of dividend payouts and the potential for long-term growth.

S-REITs provide the potential for both dividend income and long-term investment growth

Discovering the opportunities presented by S-REITs on SGX reveals a landscape rich with potential for both dividend income and long-term investment growth.

By offering a diverse array of real estate assets and maintaining a regulatory environment that encourages consistent dividend payouts, SGX stands as a premier platform for investors to delve into the rewarding realm of S-REITs.

This chapter adds another layer to our understanding of SGX’s multifarious offerings, reinforcing its appeal as a versatile and investor-centric marketplace.

For a comprehensive overview on S-REITs, kindly download our e-book: The Ultimate Guide to Investing in Singapore REITs.

Disclaimer: ProsperUs Head of Content & Investment Lead Billy Toh doesn’t own shares of any companies mentioned.

Billy Toh

Billy is deeply committed to making investment accessible and understandable to everyone, a principle that drives his engagement with the capital markets and his long-term investment strategies. He is currently the Head of Content & Investment Lead for Prosperus and a SGX Academy Trainer. His extensive experience spans roles as an economist at RHB Investment Bank, focusing on the Thailand and Philippines markets, and as a financial journalist at The Edge Malaysia. Additionally, his background includes valuable time spent in an asset management firm. Outside of finance, Billy enjoys meaningful conversations over coffee, keeps fit as a fitness enthusiast, and has a keen interest in technology.

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