Yahoo Finance 4 Singapore REITs Yielding More Than Your CPF Special Account
The Central Provident Fund (CPF) scheme is a great way for Singaporeans to save for their retirement.
The Ordinary Account (OA) currently earns a near risk-free return of 2.5% while the Special Account (SA) carries an interest rate of 4%.
What’s more, you can also open a CPF Investment Account to help to invest the monies without your OA to achieve higher returns.
If you are below 55 years of age, you also earn up to 5% interest on the first S$60,000 of the combined balances for OA, SA, and the Medisave Account (MA).
Attractive as this may sound, there are Singapore REITs that offer a rate that is higher than what the SA is offering.
These REITs are not only supported by strong sponsors but also offer the promise of future growth in both their asset base and distributions.
Income-seeking investors thus can enjoy both dividends and future capital gains from unit price appreciation as these REITs become more valuable.
Here are four REITs that are yielding more than the CPF SA’s 5% interest (on the first S$20,000).
CapitaLand Integrated Commercial Trust (SGX: C38U)
CapitaLand Integrated Commercial Trust, or CLCT, is a retail and commercial REIT that owns 21 properties in Singapore, two in Germany, and three in Australia.
Total assets under management (AUM) stood at S$24.2 billion as of 31 December 2021.
CICT recently reported its fiscal 2022’s third quarter (3Q2022) and nine-month (9M2022) business update.
Gross revenue rose 13.7% year on year for 3Q2022 while net property income (NPI) increased by 12.7% year on year to S$273.3 million.
For 9M2022, gross revenue and NPI were up 8.9% and 8.4% year on year to S$1.1 billion and S$775 million, respectively.
CICT’s operating metrics remain robust, with committed occupancy at 95.1% as of 30 September 2022.
Rental reversion for 9M2022 chalked up a positive 0.6% for retail assets and 7.9% for office assets for the REIT.
CICT pays out its distributions half yearly and its trailing 12-month distribution per unit (DPU) stood at S$0.1044.
At a unit price of S$1.74, the REIT’s trailing 12-month distribution yield stands at 6%.
Frasers Centrepoint Trust (SGX: J69U)
Frasers Centrepoint Trust, or FCT, is a retail REIT with nine suburban retail malls within its portfolio.
AUM stood at S$6.1 billion as of 30 June 2022.
FCT released a pleasing set of numbers for its 3Q2022 business update ending 30 June 2022.
The committed occupancy for its retail portfolio stood high at 97.1%, and the REIT also saw tenant sales up 23% year on year, surpassing COVID-19 levels.
69% of FCT’s borrowings are hedged to fixed interest rates, thus mitigating the sharp rise in interest rates that may push up borrowing costs.
Aggregate leverage stood at 33.9%, allowing the REIT sufficient debt headroom to tap on more borrowings for acquisitions.
The retail REIT’s trailing 12-month DPU stood at S$0.12225, giving its units a trailing distribution yield of 6.2%.
Mapletree Logistics Trust (SGX: M44U)
Mapletree Logistics Trust, or MLT, owns a portfolio of 185 properties in eight countries with an AUM of S$13 billion as of 30 June 2022.
For the first quarter of fiscal 2023 (1Q2023), MLT saw gross revenue improve by 14.6% year on year to S$187.7 million.
NPI increased by 13.2% year on year to S$163.2 million while DPU inched up 5% year on year to S$0.02268.
MLT’s trailing 12-month DPU stood at S$0.08894, giving its units an attractive trailing distribution yield of 6.2%.
The logistics REIT continued to report healthy operating metrics for 1Q2023, with portfolio occupancy at 96.8% along with a positive rent reversion of 3.4% for the quarter.
MLT had also recently concluded two acquisitions of a logistics park in China and a logistics centre in South Korea.
With aggregate leverage at 37.2% and 80% of the REIT’s borrowings on fixed rates, investors can anticipate more debt-fuelled acquisitions from MLT.
Keppel DC REIT (SGX: AJBU)
Keppel DC REIT is a data centre REIT with 21 properties across nine countries.
Its AUM stood at S$3.5 billion as of 30 June 2022.
DPU for 1H2022 inched up 2.5% year on year to S$0.05049 despite NPI dipping slightly by 0.5% year on year.
Keppel DC REIT’s trailing 12-month DPU stood at S$0.09976, giving its units a trailing distribution yield of 6.2%.
Data centres continue to be supported by strong global demand, and Keppel DC REIT’s portfolio occupancy rate stood high at 98.2% as of 30 June 2022.
The REIT had just announced an acquisition of two data centres in Guangdong, China, with a DPU accretion of 2.7%.
Aggregate leverage stood at 35.3% with a low cost of debt of just 1.9%.
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Disclaimer: Royston Yang owns shares of Keppel DC REIT.
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