Industrial S-REITs remain 'choice sector'; top picks being A-REIT, FLCT and MLT: DBS

Felicia Tan
Felicia Tan9/29/2021 8:15 AM GMT+08  • 5 min read
Industrial S-REITs remain 'choice sector'; top picks being A-REIT, FLCT and MLT: DBS
Among the mid-caps, Lai and Tan say they prefer ALLT and ESR-REIT “for their access to new economy assets from sponsor pipelines”.
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Industrial Singapore REITs (S-REITs) are now the plays for the “new economy”, write DBS Group Research analysts Dale Lai and Derek Tan in a sector report on Sept 23.

“Investors have often baulked at the industrial S-REITs’ tight yields of [around] 5.7% (4.5% for large caps) but we believe that this premium is justified,” say the analysts.

“With the sector’s earnings resilience proven during the Covid-19 recession and with economies re-opening, we believe that sector remains on a firm footing to deliver decent growth of more than 3% compound annual growth rate (CAGR) over FY2021-FY2023,” they add.

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