Singapore REITs were some of the Straits Times Index' biggest losers as markets closed sharply lower on Friday on weaker-than-expected Chinese economic data. Office REIT Frasers Commercial Trust dived nearly 6 percent while CapitaMall Trust and CapitaRetail China Trust bled about 5.6 percent each. This as compared to the Straits Times Index (STI) which lost only 1.8 percent.
|Frasers Commercial Trust's pole position in the list of losers have been attributed to the REIT's lack of diversity and market capitalization.|
The rest of the 10 worse losing REITs or Trusts are compiled as follows:
|REIT / Trust||Price||Drop||%|
|Frasers Commercial Trust||1.49||-0.095||-5.994|
|CapitaRetail China Trust||1.595||-0.095||-5.621|
|Mapletree Industrial Trust||1.47||-0.085||-5.466|
|Lippo Malls Indonesia Trust||0.535||-0.03||-5.31|
|AIMS AMP Industrial REIT||1.735||-0.095||-5.191|
|CACHE Logistics Trust||1.345||-0.07||-4.947|
|Cambridge Industrial Trust||0.805||-0.04||-4.734|
The dive in the stock markets have largely been attributed to a slow down in Chinese manufacturing data and a hint by the US Central Bank that it may finally ease monetary policy.
But is there reason for unit holders to panic at this point of time?
Singapore REITs may have been given an inordinate amount of visibility this past half a year as the market saw several celebrated IPOs and IPO rumors such as the Mapletree Greater China Commercial Trust and the keenly anticipated SPH REIT. These might have contributed to an artificial rise in prices as punters chased what they thought to be the next rising stars.
But generally fundamentals for Singapore REITs remain stable, bearing severe economic conditions, and the latest sell-off last Friday may present investors with a more rational entry point into the local REIT market. Yields for REITs the past couple of months have after all witnessed compression not seen in years.
Prices of the REITS and Trusts above may see further softening Monday as the markets open before bargain hunting begins to shore up prices again towards the end of the week.