3 Singapore REITs That Just Increased Their Dividend

May 18, 2023

Singapore real estate investment trusts, also known as S-REITs, have been gaining significant traction over the past month as we near the end of the interest rate hike cycle.

As the risk of a potential recession mounts, S-REITs are emerging as an attractive investment alternative for investors aiming to enhance their income and diversify their portfolios.

A key strategy for dividend investors to consider involves focusing on the growth of the distribution per unit (DPU), a powerful indicator of potential income, performance, and reliability.

So, for investors who want sustainable, and rising, passive income here are three S-REITs that have successfully expanded their DPU in the challenging economic landscape of the past year.

1. Keppel DC REIT

Keppel DC REIT (SGX: AJBU) had been a solid performer, with a portfolio of 23 data centres across nine countries, valued at S$3.7 billion as of Q1 2023.

The REIT’s gross revenue and net property income (NPI) saw respective increases of 6.5% and 6.3% year-on-year (yoy), reaching S$70.4 million and S$63.9 million.

The strong performance lead to an increase in its DPU.

Keppel DC REIT’s DPU for the quarter was 3.0% higher yoy at 2.541 Singapore cents, driven by a 4.1% yoy increase in distributable income to $46.3 million.

2. Parkway Life REIT

Parkway Life REIT (SGX: C2PU), a healthcare REIT, witnessed a substantial improvement in its gross revenue and NPI by 21.7% and 23.5% yoy, respectively, for Q1 FY2023.

In line with the stronger financial performance, Parkway Life REIT’s DPU for the quarter also increased by 2.5% yoy to 3.65 Singapore cents.

3. Mapletree Logistics Trust

Mapletree Logistics Trust (SGX: M44U) reported a 7.7% rise in gross revenue for FY2023, with NPI increasing by 7.2% year on year.

The logistics REIT also announced a string of positive operating metrics for FY2023, including a high portfolio occupancy and a revaluation gain of S$224.2 million.

The strong performance has helped Mapletree Logistics Trust to increase its DPU by 2.5% yoy to 9.011 Singapore cents in FY2023.

Invest in S-REITs that have demonstrated strong track record

S-REITs have demonstrated resilience and growth despite of the challenging economic environment, showcasing their potential as a beneficial addition to investors’ portfolios.

By investing in S-REITs that are able to grow their DPUs consistently, investors will be able to protect their portfolio from volatile markets.

The impressive results shown by the three S-REITs mentioned here underscore their strong potential for future growth, reinforcing S-REITs’ standing as an attractive investment vehicle.

Disclaimer: ProsperUs Investment Coach 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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