Asian Reits' market cap doubles in six months to over US$80b at end-June
Robust: Singapore's 16 listed Reits at end-June accounted for US$19.2 billion in market cap, including Ascendas Reit which leased out this Infineon building THE number of Singapore-listed property trusts could reach 30 next year if market conditions remain favourable, says CB Richard Ellis (CBRE) in a report.
But competition in the Asian real estate investment trust or Reit market is likely to intensify as more cross-border Reits are listed here and in Hong Kong, says CBRE.
The new listings will probably include Reits focused on serviced apartments, healthcare facilities and hotels, it says.
Related Link - http://tinyurl.com/22fwkn
CB Richard Ellis' press release
The market capitalisation of listed Reits in Asia grew to more than US$80 billion at end-June, about double the value at the end of 2005, according to CBRE.
Singapore's 16 listed Reits accounted for US$19.2 billion of this, based on their combined market cap at end-June.
Since then, another two Reits have listed here - Ascendas India Trust, which owns technology business parks in India; and Parkway Life Reit, which holds three hospitals here. Both were listed last month.
Buoyant market conditions and 11 new Reit listings in Asia during the first half - including Macarthurcook Industrial Reit here in April - were behind the surge in total market cap.
In Singapore, 11 Reits saw their share price rise more than 10 per cent in the first half. CapitaRetail China Trust, which listed here last December, saw its price rocket 50 per cent in the six months to end-June.
Since mid-July, however, Reit share prices here and elsewhere in Asia have fallen considerably from their first-half peaks, amid turmoil in the broader financial markets.
Japan is still by far the largest market for listed Reits in Asia. Its 41 Reits accounted for US$49.1 billion of the total market cap of listed Reits in Asia at end-June.
CBRE's report also says established Reit markets will face increasing competition from newcomers.
Danny Mohr, CBRE's executive director for Asian Reits, says: 'While Singapore and Hong Kong are striving to be regional Reit centres, the Thailand and Malaysia Reit markets saw significant growth through the listing of domestic Reits.'
Despite the recent troubles in the financial markets, CBRE says, 'there has been no sign of a slowdown in portfolio building via acquisitions by major Reit sponsors, who are taking a long-term view in developing Reits in the region'.
In Singapore, 'the outlook for the S-Reit market remains positive', it says. 'If market conditions remain favourable, the number of listed S-Reits could reach 30 by the end of 2008.'
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