In a recent report, JP Morgan has a preference for retail and hospitality REITs among the REITs because of the Phase Three reopening, a cyclical recovery, the probability of herd immunity through a vaccination programme, and strong double-digit DPU growth for this year and next.

Office REITs get an “underweight” from JP Morgan because of continued workfrom-home (WFH) trends. As a result, its top picks among the REITs are CapitaLand Integrated Commercial Trust (CICT) for idiosyncratic reasons, and Frasers Centrepoint Trust for its resilient suburban malls.

MLT has an advantage over all the other REITs because of its size, sector, cost of capital and ability to grow. “MLT is having a tailwind because of its logistics portfolio, and 70% to 80% of the portfolio has in-built rental escalations of 1% to 3%,” Song observes. “If there is the same yield [as MLT’s] for different exposures, we would prefer logistics exposure as we prefer logistics ahead of retail and office.”

To continue reading,

Sign in to access this Premium article.

Subscription entitlements:

Less than $9 per month
3 Simultaneous logins across all devices
Unlimited access to latest and premium articles
Bonus unlimited access to online articles and virtual newspaper on The Edge Malaysia (single login)

Stay updated with Singapore corporate news stories for FREE

Follow our Telegram | Facebook