REIT Watch – S-REITs record net institutional inflows in March as sector snaps 5-month losing streak

Constituents of the iEdge S-REIT Index

Source: Company announcements, Bloomberg (data as of 31 Mar 2025).

Global markets experienced a sell-off after United States President Donald Trump imposed a 10 per cent baseline tariff on imported goods from all countries starting April 5. US markets reacted sharply, with the S&P 500, Dow and Nasdaq indices dropping 4.8 per cent, 4 per cent and 6 per cent respectively on the April 3 session.

Following that and on April 4, the Straits Times Index (STI) dipped close to 2 per cent in the morning session and saw approximately S$1.6 billion worth of shares change hands. STI closed the week with a 3.7 per cent decline, after 5 consecutive sessions of losses.

In contrast, Singapore real estate investment trusts (S-REITs), as tracked by the iEdge S-REIT Index, rose 1.4 per cent on April 3 following Trump’s tariff announcement and ended the week in positive territory, up 0.2 per cent. S-REITs outperformed the global REITs market with the FTSE EPRA Nareit Global REITs Index declining over 3 per cent in the April 3 session. The FTSE EPRA Nareit Asia Pacific Index and FTSE EPRA Nareit Asia ex Japan Index also underperformed S-REITs at 0.2 per cent and 0.9 per cent respectively.

Institutional investors were seen to have rotated into S-REITs, with about S$26 million of net inflows during the April 3 session, possible indicating a preference for relative stability and income potential amid a volatile market.

S-REITs ended the first quarter of this year with total returns of 2.8 per cent, driven by a 5.0 per cent price gain in March, marking its best monthly return in eight months.

Within the iEdge S-REIT Index, 23 trusts were gainers, two remained unchanged, and 5 were decliners during March. Top S-REIT performers for the month were Frasers Hospitality Trust, Frasers Logistics & Commercial Trust, ParkwayLife REIT, Keppel REIT, and CapitaLand Integrated Commercial Trust. ParkwayLife REIT and CapitaLand Integrated Commercial Trust were also among top 5 gainers on April 3, with gains of 5.2 per cent and 3.3 per cent respectively.

Conversely, underperformers in March were Digital Core REIT, Keppel Pacific Oak US REIT, Sasseur REIT, Manulife US REIT, and Daiwa House Logistics Trust.

In March, Digital Core REIT saw Franklin Resources Inc, one of the world’s largest investment managers, also known as Franklin Templeton, emerge as a substantial shareholder of the REIT with a 5.06 per cent interest. The 969,800 units were acquired at an average price of US$0.577 apiece.

In terms of fund flows, institutional investors net bought over S$71 million into the sector during March, after five consecutive months of net institutional outflows since last September.

The five S-REITs which saw the largest net institutional inflows in March were CapitaLand Integrated Commercial Trust, Mapletree Logistics Trust, Paragon REIT, Keppel REIT, and ParkwayLife REIT.

DBS Research notes that geopolitics and trade tariffs remain key overhang which could further escalate global trade tensions and add to inflationary pressures. However, the house sees a risk-off shift towards defensive names, which could benefit REITs in the process. DBS Research’s preferences remain on Singapore retail and industrial sub-segments. Market consensus also remains for two rate cuts for the rest of 2025.

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Originally Posted April 7, 2025 – REIT Watch – S-REITs record net institutional inflows in March as sector snaps 5-month losing streak