SINGAPORE (Dec 10): Singapore’s real estate investment trust sector has been the main success story of the past 16 years for the Singapore Exchange, turning Singapore into a REIT hub of sorts. The S-REIT model that has endeared both investors and issuers to it is the external manager model. It kick started with local developers becoming sponsors and major unitholders of their REITs.
Ascendas-Singbridge, CapitaLand, Mapletree Investments, Keppel Land, Frasers Property and City Developments listed some of their best investment properties into REITs. The developers supported the REITs in terms of management and, more importantly, during fundraising exercises when the REITs made acquisitions.
“The externally managed S-REITs are very successful because sponsors are very committed to making the REIT successful,” says He Jihong, chief investment officer of Ascendas-Singbridge. “It’s very important for a REIT to be backed by a strong sponsor to provide a pipeline and ensure the execution of the deal. If necessary, the sponsor works together with the REIT manager to ensure we can make the necessary acquisitions. We work together as a team.”