๐๐๐๐ ๐๐ง๐ฏ๐๐ฌ๐ญ๐ฆ๐๐ง๐ญ ๐
๐จ๐ซ๐ฎ๐ฆ ๐๐ฒ ๐๐ก๐ ๐๐๐ ๐ ๐๐ข๐ง๐ ๐๐ฉ๐จ๐ซ๐ โ ๐ ๐๐จ๐ฐ๐๐ซ๐๐ฎ๐ฅ ๐๐ฑ๐๐ก๐๐ง๐ ๐ ๐จ๐ ๐๐๐ซ๐ฌ๐ฉ๐๐๐ญ๐ข๐ฏ๐๐ฌ
Honored to be part of this insightful REIT Investment Forum organized by The Edge Singapore, where industry leaders and experts came together to share diverse views on the evolving landscape of Singapore REITs.
Over the past few years, Iโve observed a recurring theme whenever I speak with investors about overseas-focused REITs: the confidence gap.
When we look at Singapore-listed REITs with local assets, it feels naturalโwe can see the malls, walk through the offices, and even dine in the hotels. That familiarity builds comfort. But when it comes to REITs holding overseas properties, the same comfort is missing. Instead, questions arise:
How do I know the assets are really of quality?
What are the rules, taxes, and risks in those countries?
Will foreign exchange wipe out my yield?
These concerns are valid. Yet, overseas REITs are also where investors can find diversification, resilience, and attractive long-term opportunities. The key lies in how trust is built and sustained between managers and investors.
Local properties are tangible. Investors know their value intuitively. With overseas portfolios, distance creates uncertainty. This โfamiliarity gapโ is the biggest hurdle that global REITs must overcome.
The solution? Transparency and communication.
Managers need to go beyond quarterly reportsโregular property updates, virtual site tours, tenant case studies, and even on-the-ground insights go a long way in helping investors see what they own.
When investors cannot physically verify the properties, management credibility becomes the anchor of trust.
What investors want to see is clear alignment:
Managers protecting DPU and yields.
Prudent debt management with a clear refinancing roadmap.
Honest, timely communicationโespecially in tough quarters.
When managers demonstrate alignment with unitholders, investors are more willing to back overseas expansion strategies.
Two of the biggest concerns for global REITs are currency volatility and rising refinancing costs.
At the REIT level, the impact depends on how well operating income, debt, and distributions are matched in the same currency. Effective hedging strategies also reduce noise.
At the investor level, Singapore investors must remember that distributions may be converted back into SGDโcreating another layer of FX risk.
Rates are another layer. As we head into a potential rate cut cycle, borrowing costs may ease. But strategy shouldnโt swing entirely on rate outlooksโwhat matters is whether a REITโs capital structure is resilient across cycles.
Many investors chase high yields overseas, sometimes 8โ10%. But yield alone should never be the reason to invest.
The real question: Is the DPU sustainable and growable?
Look deeper into:
Lease expiry profile and tenant quality.
Sector-specific risks in that geography.
FX hedging and debt maturity ladders.
The REITโs ability to recycle capital or grow assets accretively.
A headline yield may be a signal, but itโs also a potential siren.
Before adding an overseas REIT into your income portfolio, I recommend asking:
Visibility: Do you have access to clear, updated information about the assets and tenants?
Governance: Does the manager communicate openly and align incentives with unitholders?
Currency Map: Are income, debt, and distribution currencies aligned? Is there a hedging policy?
Debt Profile: What does the refinancing ladder look like in the next 2โ3 years?
DPU Drivers: Where will growth or stability come from?
Portfolio Fit: How does it add diversification in geography, sector, or currency?
Overseas-focused REITs will continue to be an important part of the Singapore market. They offer opportunities for diversification, growth, and attractive yieldsโbut only when investors can invest with clarity and conviction.
As both an advisor and investor, I believe bridging the confidence gap requires effort on both sides. Managers must be more transparent and aligned; investors must adopt a structured framework to evaluate opportunities beyond our borders.
At REITsavvy, my mission is to help investors cut through the noise, ask the right questions, and build portfolios that are both resilient and income-generating.
Overseas investing isnโt about blind faithโitโs about informed confidence. And when that confidence is built, global REITs can become a powerful engine for long-term passive income.
Kenny Loh is a distinguished Wealth Advisory Director with a specialization in holistic investment planning and estate management. He excels in assisting clients to grow their investment capital and establish passive income streams for retirement. Kenny also facilitates tax-efficient portfolio transfers to beneficiaries, ensuring tax-efficient capital appreciation through risk mitigation approaches and optimized wealth transfer through strategic asset structuring.
In addition to his advisory role, Kenny is an esteemed SGX Academy trainer specializing in S-REIT investing and regularly shares his insights on MoneyFM 89.3. He holds the titles of Certified Estate & Legacy Planning Consultant and CERTIFIED FINANCIAL PLANNER (CFP).
With over a decade of experience in holistic estate planning, Kenny employs a unique โ3-in-1 Will, LPA, and Standby Trustโ solution to address clientsโ social considerations, legal obligations, emotional needs, and family harmony. He holds double masterโs degrees in Business Administration and Electrical Engineering, and is an Associate Estate Planning Practitioner (AEPP), a designation jointly awarded by The Society of Will Writers & Estate Planning Practitioners (SWWEPP) of the United Kingdom and Estate Planning Practitioner Limited (EPPL), the accreditation body for Asia.
You can join his Telegram channel #REITirement โ SREIT Singapore REIT Market Update and Retirement related news. https://t.me/REITirement