3 Singapore REITs to Watch for October 2025

Core Insights - The REITs sector in Singapore is experiencing a dynamic environment influenced by interest rate volatility, changing tenant needs, and structural trends like digitisation, leading to varying fortunes across different sectors [1][2] Group 1: Keppel DC REIT - Keppel DC REIT reported a 12.8% year-on-year increase in distribution per unit (DPU) to S$0.05133 for the first half of 2025, with gross revenue rising 34.4% to S$211.3 million and net property income increasing 37.8% to S$182.8 million [3] - The REIT is acquiring a 98.47% stake in Tokyo Data Centre 3 for approximately S$707 million, which is expected to be 2.8% DPU-accretive and enhances its position in the Asia Pacific data centre market [4][5] - With AI workloads projected to account for 70% of global data centre demand by 2030, Keppel DC REIT is well-positioned to benefit from these structural tailwinds [6] Group 2: Keppel REIT - Keppel REIT made a strategic acquisition of a 75% stake in Top Ryde City Shopping Centre in Sydney for approximately S$334.8 million, yielding an initial property yield of 6.7% and a 1.34% pro forma DPU accretion [7] - Following this acquisition, Keppel REIT's portfolio will expand to S$9.8 billion across 14 properties, with office assets making up 95.8% and retail assets 4.2% [8] - For the first half of 2025, Keppel REIT's property income rose 9.1% year-on-year to S$136.5 million, while net property income surged 11.8% to S$108.3 million, despite a 2.9% decline in DPU to S$0.0272 [9] Group 3: Lendlease Global Commercial REIT (LREIT) - LREIT agreed to divest the Jem office component for S$462 million, which will reduce its gearing from 42.6% to approximately 35%, strengthening its capital structure [11] - As of June 30, 2025, LREIT's total assets under management were S$3.76 billion, with gross revenue declining 6.5% year-on-year to S$206.5 million and net property income falling 10.0% to S$148.8 million [12] - Despite revenue challenges, LREIT maintains solid portfolio fundamentals with a committed occupancy of 92.1% and positive retail rental reversion of 10.2% for the year [13] Group 4: Investment Outlook - The three Singapore REITs present different value propositions for income investors, with Keppel DC REIT focusing on growth, Keppel REIT showing operational strength but facing office market risks, and LREIT prioritizing balance sheet repair over growth [14][15] - All three REITs share the ability to deliver steady income, making them appealing for investors looking for reliable payers [15]