After a challenging stretch of high interest rates and tightening credit, Singapore REITs (S-REITs) are entering 2026 on much steadier ground. As financing conditions ease and distributions stabilise, income investing is regaining its momentum. That said, the recovery is unlikely to lift all boats equally. In the coming year, the gap between the best and the rest will matter more than ever. We’ve identified four S-REITs that stand out for their operational resilience and disciplined capital management.What ...

Singapore’s REIT sector heads into January 2026 with investors seeking clarity on their future. In particular, there are three Straits Times Index (SGX: ^STI) REITs that are set to release earnings updates that could signal turning points in their respective growth trajectories. From a logistics REIT showing signs of stabilisation in a challenging China market, to an industrial REIT navigating North American headwinds, to a data centre specialist riding acquisition-driven momentum, each offers distinct cata ...

The Goodman Group (ASX: GMG) share price is soaring 9% higher today after it announced a European data centre partnership.Goodman develops, owns and manages industrial properties across the world. Properties in its portfolio include logistics and distribution centres, multi-storey industrial, warehouses and data centres. It is the largest property group on the ASX.$14 billion European data centre deal with CCP InvestmentsGoodman has signed an agreement with Canada Pension Plan (CPP Investments) to establish ...

Welcome to this week’s edition of Top Stock Highlights.This week brought positive developments across Singapore’s economy and property market. Economists sharply upgraded the city-state’s 2025 GDP growth outlook, while Keppel DC REIT moved to consolidate ownership of two data centres. Meanwhile, a CapitaLand-UOL consortium emerged as the top bidder for a landmark Hougang Central mixed-use site.MAS December 2025 Economic Survey Economists have sharply raised Singapore’s 2025 GDP growth forecast to 4.1%, up f ...

Core Insights - Three blue-chip Singapore REITs are increasing their distributions for 2025, but each is following a distinct strategy that reflects varying market conditions and operational focuses [1][14]. Keppel DC REIT - Keppel DC REIT reported a 55.5% year-on-year increase in distributable income to S$195.3 million for the first nine months of 2025, with a DPU of S$0.0767, up 8.8% [3][4]. - The growth was driven by data centre acquisitions, including Keppel DC Singapore 7 & 8 and Tokyo Data Centre 1, leading to a 37.7% increase in gross revenue to S$322.4 million [3][4]. - Net property income rose 42.2% to S$280.2 million, with occupancy at 95.8% and a weighted average lease expiry of 6.7 years [4]. - The REIT is divesting non-core assets to focus on data centres, positioning itself to benefit from the AI infrastructure boom [5]. Frasers Centrepoint Trust - Frasers Centrepoint Trust achieved gross revenue of S$389.6 million for FY2025, a 10.8% increase year-on-year, while net property income rose 9.7% to S$278.0 million [5][6]. - The DPU increased only 0.6% to S$0.12113 due to dilution from a S$1.1 billion acquisition of Northpoint City South Wing [6][7]. - Despite dilution, operational metrics remained strong, with rental reversion at 7.8% and portfolio committed occupancy at 98.1% [7][8]. - The REIT is actively recycling its portfolio, including the divestment of Yishun 10 Retail Podium [9]. Mapletree Pan Asia Commercial Trust - Mapletree Pan Asia Commercial Trust reported a 3.2% decline in gross revenue to S$218.5 million for 2Q'FY5/26, while net property income fell 2.2% to S$163.9 million [10][12]. - Despite revenue decline, DPU increased by 1.5% to S$0.0201, supported by cost savings from lower operating expenses and finance costs [10][11]. - Committed occupancy was at 88.9%, with rental reversion flat at negative 0.1% for the first half [11][12]. - The REIT's revenue decline was influenced by divestments, indicating a defensive rather than growth-oriented strategy [12][13]. Comparative Analysis - All three REITs are increasing distributions, but through different mechanisms: Keppel DC REIT benefits from structural tailwinds in the data centre sector, Frasers Centrepoint Trust is focused on long-term growth despite short-term dilution, and Mapletree Pan Asia Commercial Trust is emphasizing financial discipline amid revenue challenges [14][15].

Core Viewpoint - The rapid increase in debt issuance by major tech firms to fund artificial intelligence and data center expansions could lead to market oversupply and widen credit spreads, raising concerns among investors about potential risks in the sector [1][9]. Group 1: Debt Issuance and Market Impact - Tech firms are projected to seek up to $1.5 trillion in debt by 2028 for expansion in AI and data centers, which may lead to wider spreads across the credit market [1][9]. - JPMorgan Chase's strategist Matthew Bailey expressed concerns that excessive data center financing could result in supply indigestion, particularly in dollar markets [2][9]. - The total tech debt supply is expected to exceed $900 billion next year, indicating a significant increase in borrowing needs [6][10]. Group 2: Major Players and Capital Expenditure - Major tech companies, including Alphabet, Meta, Amazon, Microsoft, and Oracle, have capital expenditure needs estimated at around $570 billion for 2026, a substantial increase from $125 billion in 2021 [6][10]. - Alphabet raised $17.5 billion in the US and ₹6.5 billion ($7.5 billion) in Europe, while Meta sold $30 billion, marking significant corporate deals in the region [5][10]. Group 3: Investor Sentiment and Market Dynamics - Despite the large-scale debt issuance, there are no broad signs of panic in the credit market, as many sales have come from top-tier companies [2][9]. - Investors are questioning the potential returns on massive AI investments, with concerns about a glut of lower-quality names in the AI space [5][10]. - The strategic importance of these projects has made tech issuers less price-sensitive, which could lead to broader market repricing [7][10]. Group 4: Credit Market Trends - Investment-grade credit spreads are expected to widen to a range of 100-110 basis points in 2026, up from 75-85 basis points this year, driven by increased bond issuance [10]. - The corporate bond market has remained stable this year, supported by significant cash inflows chasing higher yields compared to previous years [7][10]. - For European investors, the rise in issuance from Big Tech presents an opportunity for exposure that is currently underrepresented [8][10].

Group 1 - A2A has raised its total projected investments for 2024-2035 to €23 billion ($27 billion), with €1.6 billion allocated for data centres [1] - The updated business plan increases projected investment by €1 billion and raises financial targets for the latter part of the strategy period, while confirming a minimum annual dividend growth of 4% [1] - A2A's stock fell by 7% due to overly cautious financial estimates for the upcoming year, despite a 14% increase in stock price over the last 30 days [2] Group 2 - A2A aims to become a developer of data centres and a power supplier, estimating that Italian data centre electricity demand could reach 42 Terawatt hours by 2035, up from 3 TWh this year [3] - The company is in a strong position to support the development of digital infrastructures in Lombardy, which is expected to increase electricity demand and network needs [4] - A2A sees opportunities to enhance its district heating business by leveraging digital infrastructures [5] Group 3 - A2A is considering potential acquisitions beyond Italy, although it is not interested in acquiring a minority stake in rival Edison [6] - The company reported a 4% year-on-year decline in its nine-month core profit, amounting to €1.73 billion [6]

Core Viewpoint - Industrial real estate investment trusts (REITs) are favored by investors due to their resilient performance and exposure to growth trends like e-commerce and AI, with Mapletree Industrial Trust (MIT) and Mapletree Logistics Trust (MLT) being key players in this sector [1]. Mapletree Industrial Trust (MIT) - MIT has a portfolio valued at S$8.5 billion, focusing on industrial properties and data centers in Singapore and North America as of September 30, 2025 [2]. - For 2Q FY25/26, MIT's distribution per unit (DPU) decreased by 5.6% year-on-year to S$0.0318, attributed to exchange rate headwinds, reduced rental income, and property divestments [3]. - The overall occupancy rate for MIT is stable at 91.3%, with a positive rental reversion of 6.2% for its Singapore portfolio, which constitutes 45.2% of its total portfolio [4]. - MIT reported a lower leverage of 37.3% in 2Q FY25/26 compared to 40.1% in 1Q, with a cost of debt of 3.0% and 92.9% of its debt hedged or fixed [5]. Mapletree Logistics Trust (MLT) - MLT's portfolio is valued at S$13.0 billion, focusing on logistics assets across nine Asia-Pacific markets [6]. - In 2Q FY25/26, MLT's DPU fell by 10.5% year-on-year to S$0.01815 due to forex impacts and the absence of divestment gains [6]. - MLT's occupancy rate improved to 96.1%, up from 95.7% in the previous quarter, indicating strong demand for its assets, with a positive rental reversion of 0.6% [6]. - MLT has an aggregate leverage ratio of 41.1% and a cost of debt of 2.6%, with 84% of its borrowings hedged or fixed [7]. Comparative Analysis - MIT has a trailing twelve-month (TTM) yield of approximately 6.0%, while MLT has a TTM yield of about 5.6% [10]. - Both REITs are expected to maintain distribution growth due to their exposure to data centers and e-commerce, although they face risks from foreign exchange fluctuations [10]. - MIT is positioned for growth in AI and digitalization through its data centers, while MLT benefits from regional e-commerce growth through its logistics properties [12].

Core Insights - In a high-interest-rate environment, many REITs have seen a decline in their distribution per unit (DPU), but strong REITs have managed to increase their DPU while maintaining low gearing ratios and healthy interest coverage ratios [1][16]. Group 1: Parkway Life REIT - Parkway Life REIT is recognized as one of Singapore's most defensive REITs, focusing on healthcare assets with a portfolio valued at S$2.46 billion, primarily consisting of hospitals and medical centers [3][4]. - For 1H2025, Parkway Life raised its DPU by 1.5% YoY to S$0.0765 per share, supported by a distributable income of S$49.9 million, which is up 9.5% YoY [4][6]. - The REIT has a low gearing ratio of 35.4% and an impressive interest coverage ratio (ICR) of 9.1 times, indicating strong financial health [5][6]. Group 2: Keppel DC REIT - Keppel DC REIT is a pure-play data center REIT benefiting from strong digitalization and AI demand, raising its DPU by 8.8% YoY to S$0.767 per share for 9M2025 [7][10]. - Distributable income surged by 55.5% YoY due to higher contributions from contract renewals and new acquisitions, with a strong occupancy rate of 95.8% [8][9]. - The REIT maintains a disciplined capital structure with a leverage ratio of 29.8% and an ICR of 6.6 times, with over 50% of contracts having built-in rental escalations [9][10]. Group 3: Capitaland Integrated Commercial Trust (CICT) - CICT, Singapore's largest REIT, reported a net property income growth of 1.4% YoY to S$874.2 million for 9M2025, with an overall occupancy rate of 97.2% [11][12]. - The REIT achieved positive rental reversions of 7.8% and 6.5% YoY for its retail and office properties, respectively, and increased its DPU by 3.5% YoY to S$0.0562 per share for 1H2025 [13][14]. - CICT has a strong balance sheet with a leverage ratio of 39.2% and an ICR of 3.5 times, positioning it well for refinancing opportunities [13][14]. Group 4: Investment Implications - All three REITs demonstrate positive momentum in growing their distributable income and distributions, supported by strong balance sheets that mitigate refinancing risks [16]. - The ability to sustain distribution payouts through challenging market conditions is attributed to their low leverage and healthy financial positions [16][17].

Core Insights - The latest earnings season highlights varying performances across Singapore's REIT landscape, with each sector facing distinct opportunities and challenges [1] Frasers Centrepoint Trust - Frasers Centrepoint Trust (FCT) reported a gross revenue of S$389.6 million for FY2025, marking a 10.8% increase from S$351.7 million in FY2024 [2] - The acquisition of Northpoint City South Wing, valued at S$1.17 billion, significantly contributed to FCT's revenue growth [3] - Net property income rose by 9.7% to S$278 million, while distribution per unit (DPU) increased by 0.6% to S$0.12113 [3] - FCT achieved a robust rental reversion of 7.8%, indicating strong leasing demand and landlord pricing power [3] - Committed occupancy stood at 99.9%, with shopper traffic increasing by 1.6% YoY and tenant sales rising by 3.7% [4] - The REIT's cost of debt decreased to 3.5% in 4Q2025, with aggregate leverage at 39.6%, providing room for future growth [5] Mapletree Pan Asia Commercial Trust - Mapletree Pan Asia Commercial Trust (MPACT) experienced a gross revenue decline of 3.2% YoY to S$218.5 million, with net property income falling by 2.2% [6] - Despite revenue challenges, DPU rose by 1.5% to S$0.0201, driven by divestments and cost savings rather than organic growth [7] - VivoCity reported a rental reversion of 14.1%, helping to offset weaknesses in other areas [7] - Committed occupancy was at 88.9%, with overall rental reversion showing a negative 0.1% for the first half of FY25/26, indicating tenant retention challenges [8] Digital Core REIT - Digital Core REIT reported a gross revenue increase of 83.9% YoY to US$132.4 million, with net property income rising by 49.6% to US$67.7 million [10] - Distributable income only increased by 1.9% to US$35.2 million, reflecting higher finance costs from recent acquisitions [11] - The REIT is positioned well in a supply-constrained market, with wholesale data centre pricing in Northern Virginia rising to US$225 per kilowatt monthly [11] - Digital Core REIT is trading at a 39% discount to net asset value, with management repurchasing 1.8 million units year-to-date at an average price of US$0.565 [12] - Aggregate leverage is at 38.5%, providing US$431 million in debt headroom for acquisitions and buybacks [13]