COMMERCIAL PROPERTY | Staff Reporter, Singapore

Singapore REITs' average returns hit 18.6% YTD

Thanks to growth across the banking and real estate sectors.

Singapore's 31 REITs and six stapled trusts hit an 18.6% average return for 2017 YTD.

According to SGX, all REITs have accumulated earnings over the period, which range from 5% for Fortune REIT to 34% for Sabana Industrial REIT.

The REIT Sector has benefited from the same broad growth theme that boosted stocks in Real Estate Management & Development and Banks.

Meanwhile, Singapore REITs have a current gearing ratio limit of 45%. The REITs and six trusts only have an average gearing ratio of 34.6%.

The gearing ratios range from 25.6% for SPH REIT to 43.4% for Cache Logistics Trust (CACHE).

"These gearing ratios can vary for a multitude of factors including whether the trust is focused on an acquisition strategy or focused on managing existing property assets," SGX said.

Here's more from SGX:

Note that REITs are also diversified by the type of property that they invest in, such as retail shopping malls office towers, industrial parks and logistic parks.

Singapore REITs are also diversified by geographies with the Sector offering investors a choice of Singapore-based properties, overseas-based properties in addition to REITs that invest in property both in Singapore and overseas. Hence multiple factors have accounted for recent performances beyond gearing ratios.

The average gearing ratio of the31 REITs and six stapled trusts at 34.6% is similar to the average gearing ratios for the trusts that make up the REIT Sectors of Australia and Malaysia, which are at 32.4% and 32.7% respectively.

The trusts that make up the REIT Sectors of Japan average higher gearing ratios of 44.8% , while the trusts for Hong Kong’s REIT Sector average a gearing ratio of 28.0%.

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