facebookREIT ETF Singapore Guide (2023): Here's What Investors Need to Know!

333

shares

Advertisement

260823 REIT ETF Singapore Guide

REIT ETF Singapore Guide (2023): Here's What Investors Need to Know!

profileSudhan P

Real Estate Investment Trusts (REITs) pool money from investors like you and me to invest in a portfolio of income-generating real estate assets. 

Such assets can range from shopping centres to industrial buildings.

In exchange for our investment in a REIT, we are entitled to distributions at regular intervals, usually on a quarterly basis.

As of August 2023, there are 42 REITs and property trusts listed in Singapore, making our country one of Asia’s largest markets for them:

Seven of these REITs are included in Singapore’s benchmark Straits Times Index (STI), which has 30 major components:

Source: Singapore Exchange (SGX)

There are two main ways to get exposure to the REIT market.

One is by investing in individual REITs, and the other is by buying REIT Exchange-Traded Funds (ETFs) which is more accesible. 

Here’s all you need to know about the latter!


TL;DR: Singapore REITs ETFs Guide (2023) — Best ETF Singapore (REITs)

 Phillip SGX APAC Dividend Leaders REIT ETF NikkoAM-StraitsTrading Asia Ex Japan REIT ETFLion-Phillip S-REIT ETF CSOP iEdge S-REIT Leaders Index ETFUOB APAC Green REIT ETF
Benchmark indexiEdge APAC ex Japan Dividend Leaders REIT IndexFTSE EPRA Nareit Asia ex Japan
Net Total Return REIT Index
Morningstar® Singapore
REIT Yield Focus IndexSM
iEdge S-REIT Leaders IndexiEdge-UOB APAC Yield Focus Green REIT Index
Main Geographies Where Underlying REITs are ListedAustralia: 56% Singapore: 29%
Hong Kong: 13% Thailand: 1%
Singapore: 75%
Hong Kong: 13%
India: 6%
South Korea: 3%
Malaysia: 2%
Philipines: 1%
Singapore: 100% Singapore: 100%Australia: 38%
Japan: 31%
Singapore: 25%
Hong Kong: 5%
Top 3 REIT ConstituentsLink REIT
Scentre Group
Stockland
CapitaLand Ascendas REIT
CapitaLand Integrated Commercial Trust
Link REIT
CapitaLand Ascendas REIT
Frasers Logistics & Commercial Trust
Mapletree Logistics Trust
CapitaLand Ascendas REIT
Mapletree Logistics Trust
CapitaLand Integrated Commercial Trust
CapitaLand Integrated Commercial Trust
Scentre Group
Stockland
Number of Holdings3044232656
Dividend Distribution FrequencySemi-annualQuarterlySemi-AnnualSemi-AnnualQuarterly
12 Month Dividend Yield As of 31 Jul 20233.04%5.92% 5.73%7.12%2.07%
Total Expense Ratio Per Annum1.80%0.60%0.60%0.60%0.60%
Up to 2% p.a.
Trading Board Lot
Size
11111
TickerBYJ (SGD)
BYI (USD)
CFA (SGD)
COI (USD)
CLR (SGD)SRT (SGD)
SRU (USD)
GRN (SGD)
GRE (USD)

Disclaimer: The information provided by Seedly serves as an educational piece and is not intended to be personalised investment advice. ​Readers should always do their own due diligence and consider their financial goals before investing in any stock. The writer doesn’t own shares in any companies mentioned. Information is accurate as of 26 August 2023.

Click to Teleport


REIT ETF Investement Singapore Guide: What Are REIT ETFs? 

ETF is an investment that tracks the performance of an underlying asset.

In this case, a REIT ETF tracks the performance of a specific REIT index. Here in Singapore, five REIT ETFs are tracking different indices.

S-REIT ETF List

The REIT ETFs listed in our city-state are:

  1. Phillip SGX APAC Dividend Leaders REIT ETF (SGX: BYJ) (SGX: BYI)
  2. NikkoAM-StraitsTrading Asia Ex Japan REIT ETF (SGX: CFA) (SGX: COI)
  3. Lion-Phillip S-REIT ETF (SGX: CLR)
  4. CSOP iEdge S-REIT Leaders Index ETF (SGX: SRT) (SGX: SRU)
  5. UOB APAC Green REIT ETF (SGX: GRN) (SGX: GRE)

More on the REIT ETFs later, but first…

Back to top

Why REITs ETFs Tracking REIT Index Funds in Singapore?

There are four main benefits of investing in REIT ETFs:

  • Instant diversification — REIT ETFs allow investors to own a portfolio of REITs in different sectors with a click of a button.
  • Passive — Investors don’t have to pick and monitor individual REITs, so buying REIT ETFs is an excellent option for time-starved investors.
  • Low cost — Since investors don’t have to purchase different REITs one by one, they save on commission costs that they would have incurred otherwise.
  • Professional management — REIT ETFs are also professionally managed where there’s automatic rebalancing and corporate actions, such as rights issues, are taken care of on behalf of unitholders.

Back to top

Phillip SGX APAC Dividend Leaders REIT ETF: Singapore Dividend ETF via REITs

Of the five REIT ETFs, Phillip SGX APAC Dividend Leaders REIT ETF is the oldest, having been listed on 20 October 2016.

It is also the first-ever ETF focusing on Asia Pacific REITs.

This ETF follows a smart beta strategy that ranks and weights the underlying REITs according to total dividends paid in the last 12 months, with the aim of enhancing returns above that of traditional market-cap-weighted ETFs.

Phillip SGX APAC Dividend Leaders REIT ETF tracks the iEdge APAC ex-Japan Dividend Leaders REIT Index.

Regarding geographical allocation, most of the REITs in the ETF are concentrated in Australia, followed by Singapore and Hong Kong.

With regards to the REIT sector allocation, diversified REITs (31.93%) take up most of the ETF, followed by Retail REITs (35.75%) and Industrial REITs (13.41%):

Source: Source: Phillip SGX APAC Dividend Leaders REIT ETF factsheet (data as of 30 June 2023)

The following table shows the top 10 constituents of Phillip SGX APAC Dividend Leaders REIT ETF (data as of 30 June 2023):

REITWeightMain Country
Link REIT8.91%Hong Kong
Scentre Group8.29%Australia
Stockland6.83%Australia
CapitaLand Integrated Commercial Trust6.55%Singapore
Dexus5.97%Australia
Goodman Group5.73%Australia
Vicinity Centres5.17%Singapore
Ascendas REIT5.01% Singapore
GPT Group/The4.81%Australia
Mirvac Group4.62%Australia

Back to top

NikkoAM-StraitsTrading Asia Ex Japan REIT ETF

NikkoAM-StraitsTrading Asia Ex Japan REIT ETF is the world’s first Asia ex-Japan REIT ETF, and it tracks the FTSE EPRA Nareit Asia ex Japan Net Total Return REIT Index. 

Most of the REITs in the ETF are concentrated in Singapore and Hong Kong.

In terms of REIT industry allocation, retail REITs take up around 36.3% of the ETF, followed by industrial REITs (31.7%) and office REITs (12.5%): 

Source: Nikko Asset Management Asia Limited as of 30 June 2023 | Cash in allocation charts includes cash equivalents. Percentages may not add up to 100% due to rounding.

The following table shows the top 10 constituents of NikkoAM-StraitsTrading Asia Ex Japan REIT ETF (data as of 30 June 2023):

REITWeightMain Country
CapitaLand Ascendas REIT10.30%Singapore
CapitaLand Integrated Commercial Trust9.80%Singapore
Link REIT 9.30%Hong Kong
Mapletree Logistics Trust 7.00%Singapore
Mapletree Industrial Trust 5.50%Singapore
Mapletree Pan Asia Commercial Trust 4.80%Singapore
Frasers Logistics & Commercial Trust4.60%Singapore
Embassy Office Parks REIT3.80%India
Keppel DC REIT 3.60%Singapore
Suntec REIT3.50%Singapore

Back to top

Lion-Phillip S-REIT ETF

Lion-Phillip S-REIT ETF is Singapore’s first ETF dedicated entirely to Singapore REITs.

This REIT ETF tracks the performance of Morningstar’s Singapore REIT Yield Focus Index.

The index is one of Morningstar’s strategic beta indexes that uses a proprietary three-factor rules-based investment methodology that emphasises 1) business quality, 2) financial health and 3) dividend yield.

Industrial REITs make up most of Lion-Phillip S-REIT ETF’s sector allocation (38.80%), followed by Retail REITs (20.30%) and Office REITs at 12.20%. 

The following pie chart shows the breakdown of the different REIT sectors in Lion-Phillip S-REIT ETF:

Source: Lion-Phillip

Lion-Phillip S-REIT ETF contains 28 high-quality Singapore REITs, and the weight of each REIT is capped at 10%.

As of end-June 2023, the top 10 constituents of the Lion-Phillip S-REIT ETF were:

REITWeightMain Country
CapitaLand Ascendas REIT9.10%Singapore
Frasers Logistics and Commercial Trust REIT8.70%
Mapletree Logistics Trust 8.70%
CapitaLand Integrated Commercial Trust REIT8.60%
Keppel DC REIT8.50%
Mapletree Industrial Trust8.20%
Frasers Centrepoint Trust8.10%
Suntec REIT7.20%
Mapletree Pan Asia Commercial Trust5.50%
Parkway Life Real Estate Investment REIT 5.50%

Back to top

CSOP iEdge S-REIT Leaders Index ETF

The CSOP iEdge S-REIT Leaders Index ETF has an investment objective to replicate as closely as possible, before fees and expenses, the performance of the iEdge S-REIT Leaders Index.

Like the Lion-Phillip S-REIT ETF, the CSOP iEdge S-REIT Leaders Index ETF only focuses on Singapore-listed REITs. 

Currently, take up most of CSOP iEdge S-REIT Leaders Index ETF’s allocation as follows: 

Source: SGX

Here are the top 10 REITs that are part of the CSOP iEdge S-REIT Leaders Index ETF (as of 24 August 2023): 

REITWeightMain Country
CapitaLand Ascendas REIT 10.35%
Singapore
CapitaLand Integrated Commercial Trust10.19%
Mapletree Logistics Trust10.15%
Mapletree Industrial Trust 9.47%
Mapletree Commercial Trust9.29%
Frasers Logistics and Commercial Trust8.86%
Keppel DC REIT6.24%
Suntec REIT 5.55%
Keppel REIT5.28%
CapitaLand Ascott Trust4.65%

Back to top

UOB APAC Green REIT ETF

The UOB APAC Green REIT ETF allows investors to invest in high-quality, environmentally sound real estate assets with growth potential.

The green REIT ETF aims to replicate the iEdge-UOB APAC Yield Focus Green REIT index, which contains 50 REITs listed across the Asia-Pacific region.

The index has a specific focus on yield and a weighting method that’s tilted toward the environmental attributes of real estate properties.

Here’s a breakdown of the REIT sectors for the ETF Retail REITs take up the lion’s share (38.51%), followed by Diversified REITs (30.18%) and Office REITs (13.58%): 

Source: UOB | iEdge-UOB APAC Yield Focus Green REIT Index, as at 31 March 2023. Percentages of allocation may not add up to 100% due to rounding.

Regarding geographical breakdown, Japan takes up most of the index at 40%, followed by Australia (36%), Singapore (16%), and Hong Kong at 8%.

The table below shows the 10 largest constituents of UOB APAC Green REIT ETF as of 31 March 2023:

ConstituentWeightMain Country
CapitaLand Integrated Commercial Trust7.42%Singapore
Scentre Group6.42%Australia
Stockland5.52%Australia
Vicinity Centres5.48%Singapore
Mirvac Group5.25%Australia
GPT Group/The5.21% Australia
Dexus5.15%Australia
Link REIT4.56%Hong Kong
Japan Metropiolitan Fund Invest4.24%Japan
CapitaLand Ascendas REIT3.85%Singapore

Back to top

REIT ETF Comparison

Here’s a quick comparison of the five REIT ETFs that we just discussed:

 Phillip SGX APAC Dividend Leaders REIT ETF NikkoAM-StraitsTrading Asia Ex Japan REIT ETFLion-Phillip S-REIT ETF CSOP iEdge S-REIT Leaders Index ETFUOB APAC Green REIT ETF
Benchmark indexiEdge APAC ex Japan Dividend Leaders REIT IndexFTSE EPRA Nareit Asia ex Japan
Net Total Return REIT Index
Morningstar® Singapore
REIT Yield Focus IndexSM
iEdge S-REIT Leaders IndexiEdge-UOB APAC Yield Focus Green REIT Index
Main Geographies Where Underlying REITs are ListedAustralia: 56% Singapore: 29%
Hong Kong: 13% Thailand: 1%
Singapore: 75%
Hong Kong: 13%
India: 6%
South Korea: 3%
Malaysia: 2%
Philipines: 1%
Singapore: 100% Singapore: 100%Australia: 38%
Japan: 31%
Singapore: 25%
Hong Kong: 5%
Top 3 REIT ConstituentsLink REIT
Scentre Group
Stockland
CapitaLand Ascendas REIT
CapitaLand Integrated Commercial Trust
Link REIT
CapitaLand Ascendas REIT
Frasers Logistics & Commercial Trust
Mapletree Logistics Trust
CapitaLand Ascendas REIT
Mapletree Logistics Trust
CapitaLand Integrated Commercial Trust
CapitaLand Integrated Commercial Trust
Scentre Group
Stockland
Number of Holdings3044232656
Dividend Distribution FrequencySemi-annualQuarterlySemi-AnnualSemi-AnnualQuarterly
12 Month Dividend Yield As of 31 Jul 20233.04%5.92% 5.73%7.12%2.07%
Total Expense Ratio Per Annum1.80%0.60%0.60%0.60%0.60%
Up to 2% p.a.
Trading Board Lot
Size
11111
TickerBYJ (SGD)
BYI (USD)
CFA (SGD)
COI (USD)
CLR (SGD)SRT (SGD)
SRU (USD)
GRN (SGD)
GRE (USD)

Back to top

Have Burning Questions Surrounding REITs?

Then, you must check out the Investing group on Seedly and participate in the lively discussion regarding REITs and stocks:

 

Read More

Advertisement

profile
About Sudhan P
It isn't fair competition when only one company in the world makes Monopoly. But I love investing in monopolies. Before joining the Seedly hood, I had the chance to co-author a Singapore-themed investment book – "Invest Lah! The Average Joe's Guide To Investing" – and work at The Motley Fool Singapore as an analyst.
You can contribute your thoughts like Sudhan P here.

🔥 What's Popular

    • Loading articles
    • Loading articles
    • Loading articles
    • Loading articles
    • Loading articles
    • Loading articles

Stay updated with the latest finance tips!

Receive bite-sized finance on Telegram here.
💬 Comments (0)
What are your thoughts?

No comments yet.
Be the first to share your thoughts!

🔥 What's Popular

    • Loading articles
    • Loading articles
    • Loading articles
    • Loading articles
    • Loading articles
    • Loading articles

Join our Community!

Discuss your thoughts with like-minded members in these community groups!

Stay updated with the latest finance tips!

Receive bite-sized finance on Telegram here.

Advertisement