S-REITs double equity offerings for 2019 with $6.1b raised so far

Ascendas REIT’s $1.3b rights issue will be the largest to date upon completion.

Singapore REITs have announced $6.1b in equity offerings in their secondary markets this year, almost double the amount raised in 2018.

Ascendas REIT’s proposed $1.3b rights issue will be the largest quantum raised to date once completed.

According an OCBC analysis, it was unsurprising that most REITs have been able to make distribution per unit (DPU) and net asset value (NAV) accretive acquisitions despite the use of equity, given that the FTSE Straits Times Index (FSTREI) delivered total returns of 22.8% YTD and trading at a forward P/B of 1.15x

The FSTREI saw a sudden correction of 2.3% on 8 November, the largest single-day decline since August 2015, believed to be caused by increased optimism over the China-US trade situation, macroeconomic stabilisation, and an increase in the US 10Y Treasury yield by 11 bps over two sessions.