Singapore REIT Fundamental Analysis Comparison Table – 3 June 2019

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Author: Marubozu

Technical Analysis of FTSE ST REIT Index (FSTAS8670)

FTSE ST Real Estate Investment Trusts (FTSE ST REIT Index) changed from 869.49  to 858.67 (-1.24%) as compared to last post on Singapore REIT Fundamental Comparison Table on May 5, 2019.

The REIT index is currently facing immediate resistance of 875 (the previous high in 2018) and trading within a falling wedge consolidation range between 848 to 870.  Based on the current chart pattern and and momentum,  the sentiment is BULLISH and the trend for Singapore REIT direction is still UP with a pause. All eyes will be focusing on whether the REIT index can break the 2018 high (875) and 2013 high (892) back in May 2013. Another scenario would be a break down of the 848 immediate support and we will see a larger correction of REIT index, heading towards the 200D SMA support of about 820.


Fundamental Analysis of 39 Singapore REITs

The following is the compilation of 39 REITs in Singapore with colour coding of the Distribution Yield, Gearing Ratio and Price to NAV Ratio. This gives investors a quick glance of which REITs are attractive enough to have an in-depth analysis. The 2 new IPO ARA US Hospitality Trust and Eagle Hospitality Trust are not included in this table due to insufficient data points.

  • Price/NAV decreases from 1.03 to 1.02 (Singapore Overall REIT sector is slightly over value now).
  • Distribution Yield increases from 6.40% to 6.51% (take note that this is lagging number). About 38.5% of Singapore REITs (15 out of 39) have Distribution Yield > 7%.
  • Gearing Ratio increases from 34.7% to 34.9%. 22 out of 39 have Gearing Ratio more than 35%. In general, Singapore REITs sector gearing ratio is healthy. Note: The limit of gearing ratio for REITs listed in Singapore Stock Exchange is 45%.
  • The most overvalue REIT is Parkway Life (Price/NAV = 1.62), followed by Ascendas REIT (Price/NAV = 1.42), Keppel DC REIT (Price/NAV = 1.49) and Mapletree Industrial Trust (Price/NAV = 1.40).
  • The most undervalue (base on NAV) is Fortune REIT (Price/NAV = 0.64), followed by OUE Comm REIT (Price/NAV = 0.68), Lippo Mall Indonesia Retail Trust (Price/NAV = 0.71), Sabana REIT (Price/NAV = 0.75) and Far East Hospitality Trust (Price/NAV = 0.73).
  • The Highest Distribution Yield (TTM) is Lippo Mall Indonesia Retail Trust (9.19%), followed by First REIT (8.60%), SoilBuild BizREIT (8.67%),  Sasseur REIT (8.75%)  and Cromwell European REIT (8.20%).
  • The Highest Gearing Ratio are ESR REIT (42.0%), Far East HTrust (39.9%) and OUE Comm REIT (39.4%) and SoilBuild BizREIT  (39.3%)
  • Top 5 REITs with biggest market capitalisation are Ascendas REIT ($9.0B), CapitaMall Trust ($8.9B), Capitaland Commercial Trust ($7.2B), Mapletree Commercial Trust ($5.5B) and Mapletree Logistic Trust ($5.3B)
  • The bottom 3 REITs with smallest market capitalisation are BHG Retail REIT ($359M), Sabana REIT ($442M) and iREIT Global REIT ($473M)

Disclaimer: The above table is best used for “screening and shortlisting only”. It is NOT for investing (Buy / Sell) decision. To learn how to use the table and make investing decision, Sign up next REIT Investing Seminar here to learn how to choose a fundamentally strong REIT for long term investing for passive income generation

  • 1 month increases from 1.82283% to 1.88538%
  • 3 month increases from 1.94507% to 2.00338%
  • 6 month increases from 2.00014% to 2.06215%
  • 12 month increases from 2.12550% to 2.18675%

Based on current probability of Fed Rate Monitor, the US Fed Reserve reduce the interest rate by 50bps to  2.00% in 2019. Probability of keeping the interest rate at 2.25-2.50% is only 3.2%! This means US Fed Reserve will cut the interest rate by end of this year! This is a big change from last month.


Fundamentally the whole Singapore REITs is slightly over value now. The big cap REITs are getting expensive and the distribution yield are not so attractive currently. Most of the DPU yield for big cap REIT is below 5% now. The yield spread between big cap and small cap REIT remains wide. This indicates value picks only in small and medium cap REITs.  For reference, 10-years risk free yield rate for latest Singapore Saving Bonds is 2.16%.

Yield spread (reference to 10 year Singapore government bond of 2.062%) has widened from 4.15% to 4.448%. DPU yield for a number of small and mid-cap REITs are still very attractive  (>8%) at the moment.  It is expected the next move would be on small and medium size REITs due to higher risk premium compared to big cap REITs.

Technically, the REIT index is still trading in a bullish territory and have been very defensive compared to STI. With the potential rate cut in 2019, don’t be surprise REIT index to break the resistance (875 and 892) to move higher.



If you need an independent professional review on your current REIT portfolio and need any recommendation, you may engage me in the REIT portfolio Advisory. REITs Portfolio Advisory.



Money-saving Tips for the Self-employed

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Author: Marubozu

This article was originally published by Uncapped Mortgage

Gone are the days when the American dream means climbing the corporate ladder. Over the last years, the mindset of the American worker has shifted to valuing flexibility and freedom over stability. Self-employment continues to be a rising trend as employees leave their day jobs to do freelance work or start their own business.


One of the major challenges self-employed individuals face is managing cash flow. Since you do not have the regular pay that a day job provides, not to mention health insurance and tax duties, it can be challenging when all these things fall on your shoulders. Saving and budgeting can be taxing, too, as there will be months when you’ll be flushed with cash, while there will be months when you’ll need to tighten your belt a little.


Below are a few money-saving tips for the self-employed.


Set a budget.  Whether you are a business owner or a freelancer, this is very crucial. Good financial planning can determine the success of your new venture. Total all your income sources. Make sure to list down all your expenses every month. Determine all the fixed costs such as monthly bills, subscriptions, and mortgage, which takes up a huge part of your budget. You may want to consider paying off your mortgage early to get it out of the way and have more room in your budget for other things like savings and retirement fund.  After listing down the fixed costs, add the variable expenses such as payment to freelancers if you hire some, and any other expense that vary month-to-month. By doing this, you’ll know the amount of cash you need every month to live comfortably. Stick to the budget as much as you can. There are plenty of budgeting apps and tools that can assist you with this.


Set your rate. Do not undersell yourself and do not be shy to increase your rates as you gain more experience. In terms of billing, it’s better to be billed in installments rather than in lump sum at the end of a project. It would be harder to budget your money if your cash comes in once every three months rather than having them sent in monthly installments.


Build your emergency fund. And maintain it. It is important to always save for the rainy days. An emergency fund can save you from high-interest debts in times of financial stress. Make sure you have a fund, ideally a 6-month cushion – for when something unexpected happens such as a big client backing out. This 6-month cushion cannot be built right away, but you must work towards building it as soon as you begin getting paid. Set a certain percentage of your income to be allotted to this fund every month.


Know your taxes. Now that you are self-employed, you no longer have your HR department’s compensation and benefits people to look after your taxes. You must do them yourself now. Be aware of the tax bracket you are in now that you have gone solo. If you are a business owner, seek the help of a financial advisor in determining the best entity type to register your business as.


Get help. Time is money. If you think it would be best to delegate some of your tasks to freelancers in order for you to focus on more crucial tasks, hiring help could be a great idea.


Can Debt Be Used to Build Wealth? Let’s Weigh In

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for the source.
Author: Marubozu

This article was originally published by Uncapped Mortgage

Generally, people think of debt as something to avoid. Debt usually means “bad” and no debt means you are better off financially. So the idea of using debt to build wealth can seem a bit dubious. Can you really build wealth using debt?


In order to answer this question, we first need to know that there are two kinds of debt. There is good debt and bad debt. And though the thought of debt being “good” seems counter-intuitive, the fact remains that some debt is actually good.


Good debt is a debt that will increase your finances over time. So something like a small business loan is good debt because you use the money you borrowed to build up your business, thus, bulking up your finances in the long run. Good debt also has a smaller interest. So while you are expanding your business with your small business loan, you aren’t paying an exorbitant amount in interests. This type of debt also allows you ample time to pay back your debt.

Bad debt is the exact opposite. This kind of debt has astonishingly high-interest rates and usually involves some form of collateral. There is also a very short turnaround time for you to pay your debt, plus interest, back. Some examples of bad debt are credit card debts, car title loans, and payday loans. A loan of $100 will have you paying back nearly the same amount in interests alone. Bad debt will sink you financially faster than a boat riddled with holes.


So now that you know the two types of debt, you can probably guess which one can be used to build wealth. The question now is “how”.


A good way is the example stated above. Use debt to expand your business. If you do not have a business, use debt to invest. It could be in property or in various investment funds. Whatever you decide to invest in, it is important to know your risk tolerance and how much you are willing to invest.


The principle of leverage can help you out as well. Say for example you are investing 100 dollars of your own with an expected return rate of 10%. This will earn you a return of $10. If you borrowed money with an interest rate of less than 10%, you can add to your initial $100 investment and still earn from it despite having to pay off the debt you used to invest. You can diversify your financial portfolio using this strategy as well; borrow to invest in different institutions and different kinds of investments.


There are a few to consider when using debt to invest. Think of your tolerance for debt. Can you realistically pay off your monthly payments? Can you pay off that debt within the time frame or do you need more time? Consider your cash flow as well. You need to make sure that you have enough income to pay off your debt.


So the answer to the question can debt be used to build wealth is yes, you can. You just need to choose the right kind of debt, invest in the right things, and keep in mind your debt tolerance.

[Case Study] How We Made A 44% Gain on An Undervalued Hong Kong Conglomerate

Click on [Case Study] How We Made A 44% Gain on An Undervalued Hong Kong Conglomerate
for the source.×32.jpg Author: Ho Khinwai

We didn’t blindly “hope” that our investment in this Hong Kong stock would return 44%. … Read more >>

Eagle Hospitality Trust IPO Prospectus & Summary

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Eagle Hospitality Trust IPO Prospectus & Summary

for the source.
Author: Marubozu



Eagle Hospitality Trust

EHT is a hospitality stapled group comprising EH-REIT and EH-BT.

EH-REIT is a Singapore-based real estate investment trust (“REIT”) established with the principal
investment strategy of investing on a long-term basis, directly or indirectly, in a diversified portfolio
of income-producing real estate which is used primarily for hospitality and/or hospitality-related
purposes, as well as real estate-related assets in connection with the foregoing, with an initial
focus on the US.

For the purposes of this Prospectus, real estate used for “hospitality” purposes includes hotels,
serviced residences, resorts and other lodging facilities, whether in existence by themselves as
a whole or as part of larger mixed-use developments, which may include commercial,
entertainment, retail and leisure facilities.

The REIT Manager is indirectly 51% owned by Howard Wu and 49% owned by Taylor Woods.
Howard Wu and Taylor Woods are the co-founders of the Sponsor (collectively, the “Founders”
and each, a “Founder”) and they each own 50% of the common equity interests in the Sponsor.
EH-BT is a Singapore-based business trust which will be dormant as at the Listing Date. The
Trustee-Manager is indirectly 51% owned by Howard Wu and 49% owned by Taylor Woods.
EHT is a US hospitality specialist with an invested Sponsor and a portfolio of full service hotels
in the top US markets.

See related news below:

Eagle Hospitality Trust prices IPO at US$0.78 per stapled security

  • Type = US Hospitality Sector
  • Sponsor = Urban Commons, LLC (Owners Howard Wu & Taylor Woods aggregate 15.2% of Eagle Hospitality Trust)
  • REIT Manager: Howard Wu (51%) & Taylor Woods (49%)
  • Total Unit Offered = 580,558,000
  • Portfolio = 18 Hotel in US (across 21 states, 5420 rooms)
  • Portfolio Size = US$1.27 Billion
  • IPO Offer Price = US$0.78
  • NAV per unit = US$0.88
  • Price / NAV = 0.8863
  • Distribution Yield = 8.2% (2019), 8.4% (2020)
  • Distribution Policy = 100% for 2019. 90% for 2020. Semi Annual Payout.
  • Occupancy Rate = 73.6% (2018), 78.5% (2019 Forecast), 76.8% (2020 Forecast)
  • Gearing Ratio = 38.0%
  • WADM = 4.2 Years
  • Offer Closing Date: May 22, 2019 at 12:00pm
  • Listing Date: May 24, 2019
  • Eagle Hospitality Trust IPO Prospectus


Compare to other Singapore REITs here.