(09-09-2025, 02:29 PM)Tee tiong huat Wrote: Noted: From SG Investors.io here...
recommend: SASSEUR Reit (SGX:CRPU) Target Price: with less then 3 days to go, Friday is the record date...
1) Phillip Securities ✓(Buy) - 0.780 from previously 0.810
2) DBS Research ✓✓(Buy) - 0.900
3) KGI Securities ✓✓✓(OutPerform) - 0.900 and
4) UOB Kay Hian ✓✓(Buy) - 0.980.
BROKERS’ TAKE: Analysts positive on S-Reits on prospect of more rate cuts, give top picks.
Expected US rate cuts of 125 basis points from September 2025 to March 2026 ‘augur well’ for S-Reits, says Citi.
Thu, Oct 2, 2025 · Morningstar flags Keppel Reit as one of its two top picks.
[SINGAPORE] Further US Fed interest rate cuts are widely expected, which would be a positive sign for Singapore’s real estate investment trusts (S-Reits), said analysts.
The current rally is supported by September’s 25-basis-point cut – the first cut since December, with US President Donald Trump pushing for a lower-rate regime.
Citi economists said they expect further cuts of 125 basis points from September 2025 to March 2026, which “augur well” for S-Reits.
Morningstar pointed to S-Reit performance moving inversely to Singapore’s 10-year government bond yields, which declined from 2.87 per cent at the start of the year to 1.91 per cent as at Sep 30. Real estate yields are expected to remain stable or tighten slightly in the near term, supported by the recent decline in bond yields, it added.
S-Reits’ valuation forecasts of 5.4 per cent for 2025 and 5.7 per cent for 2026 imply yield spreads of about 3.7 & 3.9 per cent over 10-year bond yields of about 1.8%, said Citi.
It added that S-Reits with greater domestic exposure are expected to fare better than those without, driven by “significantly softer” three-month Singapore Overnight Rate Average (Sora) and the stronger Singapore dollar.
The three-month compounded Sora fell from 3% on Jan 3 to under 1.5% as at Wednesday (Oct 1), while S'pore dollar has appreciated 5.9% against US dollar in year to date.
In previous rate cut cycle of 225 basis points from 2019 to 2020, Citi pointed to S-Reits’ outperformance of the Straits Times Index, the financial sector property developers.
Office S-Reits subsector was best-performing in the quarter ending Sept, supported by resilient occupancy rates strong rental reversions in the first half of 2025.