OREANDA-NEWS. Of the 28 REITs and six stapled trusts listed on the SGX, seven are classified to the sub-industries of Diversified REITs, Health Care REITs and Specialized REITs, as categorised by the Global Industry Classification Standard (GICS®).

Diversified REITs include trusts with significantly diversified operations across two or more property types; Health Care REITs include trusts engaged in the acquisition and management of properties serving the healthcare industry, including hospitals, nursing homes and assisted living properties; and Specialized REITs include trusts that operate and invest in storage properties, as well as those that do not generate a majority of revenue from real estate rental and leasing operations.

The seven REITs have a combined market capitalisation of S$11.0 billion. In the year thus far, the average total return of these REITs have remained flat, which brought their three-year return to 25.0%. They currently maintain an average Return on Equity (ROE) and dividend yield of 11.4% and 7.1% respectively.

The MSCI World REIT Index currently maintains a Total Debt to Asset Ratio of 48.2%, compared to the average for the seven REITs at 36.1%. The table below details the seven trusts, and is sorted according to Debt-to-Asset ratio. Click on each trust to visit its profile page on SGX StockFacts.

Source: SGX, Bloomberg & SGX StockFacts (data as of 8 December 2015)

*Note the indicative yield is based on the last quarterly distribution, and does not take into account the pro-rata distribution on 24 Nov 2015

Debt to Asset Ratio

One of the most commonly used leverage ratios is the Debt-to-Asset ratio, or debt ratio, which shows the percentage of assets funded through leverage and is a measure of the financial risk of a business.

The debt ratio is calculated by dividing the sum of short-term borrowings and long-term debt by the total assets of the business. A relatively high ratio indicates that the company has more liabilities, which can provide additional risks such as credit risk and default risk. A lower debt ratio implies equity makes up a larger portion of the capital structure. This conservative financing gives the business room to fund its operations through debt in future with minimal risk. On the other hand, a greater amount of debt compared to assets can improve business efficiency as there will be more money able to be put to work in the business.

Mapletree Greater China Commercial Trust

Mapletree Greater China Commercial Trust engages in the investment of various real estate properties for commercial purposes in the Greater China region. It invests in real estate properties for retail and/or office purposes, as well as other real estate-related assets. The asset portfolio comprises three commercial properties located in Hong Kong, Beijing and Shanghai, which had a combined valuation of S$5.8 billion as of 30 July 2015.

Viva Industrial Trust

Viva Industrial Trust invests in a portfolio of income-producing real estate that is predominantly for business parks and other industrial purposes in Singapore and elsewhere in the Asia Pacific region. Its asset portfolio consists of five industrial properties with an aggregate gross floor area (GFA) of 2.9 million square feet and asset value of S$962 million as of November 2015.

Suntec REIT

Suntec REIT is a real estate investment fund launched and managed by ARA Trust Management (Suntec) Limited. The fund invests in real estate and real estate-related assets that are primarily used for retail or office purposes. As at 31 December 2014, Suntec REIT’s portfolio comprises office and retail properties in Suntec City, Park Mall, a one-third interest in One Raffles Quay and a one-third interest in Marina Bay Financial Centre Towers 1 and 2 and the Marina Bay Link Mall. The REIT also owns a 60.8% interest in Suntec Singapore, and a 100% interest in 177 Pacific Highway, an office development in North Sydney which is scheduled to be completed in early 2016.

Parkway Life REIT

Parkway Life REIT invests in income-producing real estate and real estate-related assets used primarily for healthcare and healthcare-related purposes, including hospitals and healthcare facilities, as well as real estate and/or real estate assets used in connection with healthcare research, education, and the manufacture or storage of drugs, medicine, and other healthcare goods and devices. As at 30 September 2015, Parkway Life REIT's total portfolio size stands at 47 properties totalling approximately S$1.60 billion, and spans across Singapore, Japan and Malaysia.

Soilbuild Business Space REIT

Soilbuild Business Space REIT invests in a portfolio of income-producing real estate used primarily for business space purposes in Singapore as well as real estate-related assets. Soilbuild REIT's portfolio comprises 10 business space properties - two business park properties and eight industrial properties. They are located across industrial clusters in Singapore with a total net lettable area of approximately 3.3 million square feet and a valuation of S$1.03 billion as at 31 December 2014.

First REIT

First REIT invests in a portfolio of real estate related assets operating healthcare and/or healthcare-related purposes, across the real estate markets of Asia including Indonesia, Singapore, and South Korea. The asset portfolio comprises 16 properties which are collectively valued over S$1 billion

Keppel DC REIT

Keppel DC REIT invests in a portfolio of income-producing real estate assets which are used primarily for data centre purposes, as well as real estate related assets, with an initial focus on Asia Pacific and Europe. Its asset portfolio comprises nine data centre properties with aggregate lettable area of approximately 597,900 square feet, located in data centre hubs across seven cities in Asia Pacific and Europe.