Chart of the Day: Singapore’s industrial landlords face tremendous pressures in regional race

As occupancies and rents remain challenging.

Singapore-listed industrial REITs, otherwise known as industrial S-REITs, are lagging their regional peers in total returns this year.

According to a report by OSK-DMG, their relative trading underperformance is coming at a time when industrial landlords are facing pressures in occupancies and rents amid the government's ramp-up in supply of industrial space. 

OSK-DMG adds that besides increasing supply in strata-titled factories and small single-user industrial facilities, JTC has also revised its subletting policy to increase the amount of space in a building that must be occupied by anchor tenants from 50 per cent to 70 per cent, which market watchers say could affect some industrial REITs here.

OSK-DMG says, “We are most downbeat on Industrial REITs as they remain most at risk of NAV depreciation. The office subsector remains our preferred segment, followed by retail, hospitality and then industrial.”