UPDATE: Slew of S-REITs added to FTSE EPRA Nareit Global Real Estate Index series

ESR-REIT property near Singapore’s Tai Seng MRTESR-REIT property near Singapore’s Tai Seng MRT

This item was originally published on Friday, 3 September 2021 at 2:13 a.m. SGT; it has since been updated to include comments from Cromwell European REIT and Far East Hospitality Trust.

A host of Singapore REITs were added to the FTSE EPRA Nareit Global Developed Index in its latest review, in a development likely to bring the city-state’s smaller REITs more attention from global investors.

Singapore’s new additions to the index include AIMS APAC REIT, ARA LOGOS Logistics Trust, Cromwell European REIT, ESR-REIT, Far East Hospitality Trust, Keppel Pacific Oak US REIT, Lendlease Global Commercial REIT, OUE Commercial REIT, Prime US REIT, SPH REIT and Starhill Global REIT, according to an announcement from the index’s developers.

The FTSE EPRA Nareit Global Developed Index tracks listed REITs and real estate holding and development companies globally. It was developed by FTSE Russell with the European Public Real Estate Association, or EPRA, and the National Association of Real Estate Investment Trusts (Nareit).

Singapore’s smaller REIT’s often cite joining the FTSE EPRA Nareit Global Real Estate Index Series as a goal as it will increase the base of investors, including passive funds tracking the index. For example, the Amundi Index FTSE EPRA Nareit Global UCITS ETF DR, which tracks the index, has around 1.1 billion euros in assets under management, according to its end-July factsheet; the ETF has more than 350 stocks and REITs in its portfolio.

The changes to the index will take effect from 20 September.

ESR-REIT

In a statement filed to SGX Thursday, Adrian Chui, CEO and executive director of ESR-REIT’s manager, said inclusion in the index was a significant milestone in the REIT’s progress since ESR Cayman acquired then-Cambridge Industrial Trust to become its sponsor.

“Inclusion in the index will enhance our trading liquidity and visibility to investors worldwide, solidifying our position among the largest listed industrial REITs in Singapore and providing us access to wider pools of capital as we execute our organic and acquisition strategies,” Chui said in the statement.

Cromwell European REIT

Simon Garing, CEO of Cromwell European REIT’s manager, noted the Europe-focused REIT has a free float market capitalisation of around 1 billion euros, one of the largest among the Singapore REITs newly admitted to the index.

“We are confident that CEREIT will continue to be favoured by active investors while attracting new capital inflows from passive global
funds. We look forward to enhanced trading liquidity on the SGX and greater visibility to the global investment community,” Garing said in a statement filed to SGX Friday.

“This achievement further increases the appeal of CEREIT to global institutional capital and underpins our current effort to pivot the portfolio towards a 50 percent weighting to the light industrial / logistics sector,” Garing added.

Starhill Global REIT

In a statement filed to SGX Thursday, Ho Sing, CEO of YTL Starhill Global, which is Starhill Global REIT’s manager, said the inclusion in the index “reflects our commitment to drive sustainable growth for the REIT. Inclusion in the index will improve SGREIT’s visibility to a wider pool of institutional investors and index funds
which will enhance trading liquidity and facilitate future expansion initiatives.’’

AIMS APAC REIT

In a statement filed to SGX Thursday, Koh Wee Lih, CEO of the manager of AIMS APAC REIT, said: “With this inclusion, the manager looks to increase the visibility and exposure of the REIT to index funds and bring about higher trading liquidity to investors globally. This is in line with the manager’s drive to strengthen our engagement with existing and new investors, as part of a continual outreach to a high quality and diversified institutional investor base. It also ties in well with our efforts to diversify our capital sources, investment allocation and partnership opportunities in Singapore and the region.”

ARA LOGOS Logistics Trust

In a statement filed to SGX Thursday, Karen Lee, CEO of ARA LOGOS Logistics Trust’s (ALOG) manager, said entry into the index marked a significant milestone for the trust.

“Supported by ALOG’s Sponsor, LOGOS, we have continued to enhance the growth profile of the REIT, and this has allowed us to successfully achieve ALOG’s inclusion in this index. Joining this leading benchmark will not only enhance ALOG’s trading liquidity and extend our institutional investor reach but will also further strengthen ALOG’s growth story,” she said in the statement. “This will continue to cement
our solid foundation as a pure play logistics REIT as we continue to grow sustainably in the years to come.”

Keppel Pacific Oak US REIT

In a statement filed to SGX Thursday, David Snyder, CEO and chief investment officer of the manager of Keppel Pacific Oak US REIT, said the index inclusion would enhance the REIT’s visibility with institutional investors and index funds globally, as well as improve trading liquidity and support any capital raising needs.

“The inclusion complements our ongoing efforts to broaden and diversify our investor base as KORE works to establish itself as the preferred choice for U.S. office S-REIT investors seeking exposure to the fast-growing technology sector,” Snyder added.

Prime US REIT

In a statement filed to SGX Thursday, Barbara Cambon, CEO and chief investment officer of the manager of Prime US REIT, said the inclusion showed the effectiveness of the REIT’s long-term growth strategy.

“We are delighted with this development just over two years after our IPO on the SGX. During this time, we have executed three new acquisitions that have been accompanied by two well-subscribed equity capital raises issued at tight discounts, adding to our investor base and free float,” she said in the statement.

“PRIME’s inclusion into the index will further enhance our trading liquidity and visibility to global institutional investors as we continuously seek to diversify and deepen our unitholder base, and continue to establish ourselves as a prudently managed, resilient REIT with Class A assets in markets where corporate America wants to grow,” Cambon added.

Far East Hospitality Trust

Gerald Lee, CEO of Far East Hospitality Trust’s managers, said in a filing to SGX after the market close Friday, “The addition of Far East H-Trust to the FTSE EPRA Nareit Global Developed Index is a significant milestone in our growth as a leading hospitality trust. It supports our endeavours to improve the visibility of our trust amongst institutional investors globally, allowing us to further diversify our shareholder base and tap on a wider pool of capital as we expand.”