Despite few acquisitions by S-REITs this year owing to the Covid-19 pandemic, some players here are diversifying their income streams, a sign of gradual pickup in activity, say OCBC analysts in an Oct 15 note. OCBC Investment Research is maintaining its ‘overweight’ stance on the S-REITs sector.

“We continue to recommend investors to adopt a balanced approach towards investing in the sector. This entails sticking with selective winners exposed to the data centre, logistics and business parks sub-sectors and REITs which have positioned themselves defensively in anticipation of a weaker outlook, but complement these with REITs in beaten down sub-sectors with deep value and supported by strong sponsors,” note OCBC. 

Given the ongoing widespread impact of the Covid-19 pandemic, OCBC states it is not surprising that the pace of acquisitions by S-REITs has been slow this year, given the difficulties in carrying out physical due diligence. 

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