Q2 Rise A Good Sign As Singapore Fights Real Estate Decline
Singapore real estate investments remained the bright spot in Asia as transactions volumes were at 69% year-on-year. The totals climbed up to $2.9 billion through cross-border money flows as well as local investor support, a report from Real Capital Analytics (RCA) yielded.
A few standout deals were as follows: the deal for the Fraser Tower was good for $990.63 million while the Marina Square Shopping Mall sold for $487.4 million. The National Pension Service of Korea paid for the Fraser Tower deal, Singapore Business reported.
David Green-Morgan, RCA managing director for the Asia Pacific (APAC), said that investment trends in Singapore and other large Asian real estate investment sectors had shown a "positive divergence." Singapore had shown resiliency to the economic and political risks affecting the ASEAN region as well as the world over, with both domestic and foreign investors focusing on office and retail sectors in the city.
In contrast, Asia Pacific real estate investment transactions went down 19% year-on-year to $34.4 billion that showed a "lackluster" second quarter for the sector. It was compounded by the trade war as well as the economic slowdown affecting the world.
REITs have been especially big for Singapore as they have been a source of exposure to a wide range of real estate types. There are three especially high yielding REITs in the Singapore market currently, as explored through MSN's report.
The Lippo Malls Indonesia Retail Trust topped the REITs because of its uptick, valued at 1.7%. It was the first time through five quarters in which the REIT managed to show a higher year-on-year DPU as it continued to overcome the challenges presented by the current global situation, even at the expiry of some of its master leases during the period dated July 2018.
Following close is the First REIT. The REIT is trading with a trailing distribution yield totaling 8.3%. Investors expressed concern when Lippo Karawaci, First REIT's sponsor and majority tenant, suffered a credit downgrade last year, but the REIT managed to bounce back as the tenant managed to receive $1.01 billion in funding.
The EC World REIT, finally, displayed mixed results with its net property income declining 7.2% but its security deposit accretion, among other things, increased by 3.4%.
Singapore and Australia were the only bright spots on the APAC corner of the world. Australia, for its part, was boosted by renewed investor confidence after the national election stirred positive results.