The SGX building in Singapore. (Photo: REITsWeek)

A Singapore Exchange (SGX) representative has confirmed with REITsWeek that an exchange-traded fund (ETF) that tracks the SGX APAC ex Japan Dividend Leaders REIT Index is on track for launch in 2016.

SGX first announced in late August 2016 that it has launched the index to track a basket of 30 REITs across the Asia-Pacific region, excluding Japan.

The SGX APAC ex Japan Dividend Leaders REIT Index will feature REITs that pay the largest dividends, but individual constituent weights in the index are capped at 10% to ensure diversification.

Although further details on the ETF’s launch date are not yet available, the bourse has released important facts on the index, which will give investors a clearer picture on the REITs that they will be investing in with the ETF.

The SGX APAC ex Japan Dividend Leaders REIT Index consists of predominantly Australian REITs (61%). Next largest components are Singapore REITs (27%), and Hong Kong REITs (12%) respectively.

REIT Name Weight (%) REIT Listed In
Link REIT 11.21 Hong Kong
Scentre Group 10.3 Australia
Stockland 8.65 Australia
Westfield Corp 8.23 Australia
Vicinity Centres 7.48 Australia
GPT Group 5.97 Australia
Mirvac Group 5.82 Australia
Goodman Group 5.66 Australia
Ascendas REIT 4.47 Singapore
CapitaLand Mall Trust 3.52 Singapore
Suntec REIT 3.14 Singapore
CapitaLand Commercial Trust 2.47 Singapore
Mapletree Industrial Trust 1.93 Singapore
Mapletree Greater China Commercial Trust 1.88 Singapore
Investa Office Fund 1.76 Australia
Keppel REIT 1.69 Singapore
Mapletree Commercial Trust 1.56 Singapore
Mapletree Logistics Trust 1.55 Singapore
Charter Hall Group 1.38 Australia
Champion REIT 1.28 Hong Kong
Charter Hall Retail REIT 1.22 Australia
Shopping Centres Australasia Property 1.19 Australia
BWP Trust 1.06 Australia
Cache Logistics Trust 1.05 Singapore
Ascott Residence Trust 1.03 Singapore
Cromwell Property Group 1.02 Australia
Starhill Global REIT 0.97 Singapore
Frasers Centrepoint Trust 0.92 Singapore
CDL Hospitality Trust 0.88 Singapore
Abacus Property Group 0.71 Australia

The constituents will be reviewed semi-annually in March and September each year.

The SGX has confirmed that besides Australia, Hong Kong and Singapore, REITs listed in Malaysia, India, South Korea, and Thailand will also qualify should they meet the constituents’ criteria.

As at August 2016, SGX has classified 72.81% of the REITs as ‘commercial REITs’, while ‘diversified REITs’ make up 16.54% of the index. The rest of the constituents have been identified as residential REITs, and specialised REITs respectively.

As at July 2016, the SGX APAC ex Japan Dividend Leaders REIT Index has a market capitalisation of USD139.3 million, with a dividend yield of 4.53%, and a P/E ratio of 10.91.

The index’s net total returns over one year, three years and five years are 19.48%, 10.28%, and 9.13% respectively.

By Ridzwan Rahmat

Ridzwan has been analysing REITs and business trusts since 2008, and personally manages a portfolio comprising mainly of SGX-listed REITs. He founded REITsWeek in 2013.