On the top outperforming REITs in the sector, Koh writes: “We saw mild recovery in S-REITs with exposure to new economy asset classes. Logistics REITs Mapletree Logistics Trust (MLT) and Frasers Logistics & Commercial Trust (FLCT) gained 1.8% and 0.8% respectively. Industrial REITs AIMS APAC REIT (AA REIT) and Ascendas REIT (A-REIT) gained 0.7%, while retail REIT Lendlease Global Commercial REIT (LREIT) increased 1.3%.”
Conversely, he points out that diversified REITs CapitaLand Integrated Commercial Trust (CICT), Suntec REIT and Mapletree Commercial Trust (MCT) lost 3.2%, 3.1% and 2.7% respectively, while Digital Core REIT (DCREIT) declined 2.6% due to negative impact from higher interest rates.
Koh recommends focusing on recovery and reopening plays, with his picks being Ascott Residence Trust (ART), Frasers Centrepoint Trust (FCT), Far East Hospitality Trust (FEHT) and LREIT with target prices of $1.31, $2.74, 77 cents and 95 cents respectively.
Meanwhile, he also notes that the FTSE ST Real Estate Investment Trusts Index (FSTREI) corrected 0.8% in the past two weeks, underperforming the STI that lost 0.1%.
As at 11.10am, ART, FCT, FEHT and LREIT are trading at $1.14, $2.25, 64 cents and 81 cents respectively
