Asian real estate investment trusts (REITs) remained globally competitive in the second quarter, compared to their European and UK competitors, according to Neil Brookes, head of capital markets, Asia-Pacific at Knight Frank. 

Singapore REITs have witnessed a drop in share prices of around 7% year-to-date, compared to their counterparts which saw a sharper drop of around 34% in Europe and 25% for UK-listed REITs. 

“This puts them on a competitive advantage, with Singapore-based groups acquiring assets in Australia, Japan and the UK recently,” he said. 

Knight Frank found that commercial real estate transaction volumes in Asia-Pacific fell 41% year-on-year to US$55bn in the first six months of 2020. Transactions in the second quarter were down 14% compared to Q1 across the region.

In Singapore, the FTSE ST Real Estate Investment Trusts index declined 0.96% to 831.29, as the Straits Times Index dipped 0.41% to 2,620.19.

The biggest S-REIT moves were Ascendas India Trust (CY6U) shares, which fell 3.68% to S$1.31, and Soilbuild Business Space REIT (SV3U), which closed 1.22% higher at S$0.42.

Over the past month, shares in Soilbuild REIT have risen almost 8%, however the trust is still down about 20% for the year to date. 

Japan

Samty Residential Investment Corp. (3459) announced plans to buy an apartment building in  Funabashi-shi, Chiba for JPY 815m, while also disposing of its S-FORT Kyoto Nishioji asset in Kyoto for JPY 856m. 

The REIT said the transactions would improve the stability of the portfolio and expand it to 118 properties. 

The moves will also change the investment ratio by area, so that regional cities make up 71.8% of the portfolio and the greater Tokyo area accounts for 28.2%. 

Samty REIT shares closed 0.10% higher to JPY 102,700.

The Tokyo Stock Exchange REIT index edged 0.18% lower to 1,667.54, as the Nikkei 225 index fell 0.87% 22,587.01. 

Japan Hotel REIT Investment Corp. (8985) stocks fell the most among J-REITs today, down 2.74% to JPY 44,450, while Star Asia Investment Corp. (3468) shares jumped 3.70% to JPY 89,700.

Like many hospitality-focused J-REITs, COVID-19 continues to dampen investor confidence in Japan Hotel REIT, with its shares down about 45% year-to-date. 

Australia

The S&P/ASX 200 A-REIT index slipped 0.74% to 1,215.30, in line with the S&P/ASX 200 index, which finished trading down 0.61% at 5,941.10.

The biggest A-REIT swings were APN Industria REIT (ADI) stocks, which jumped 5.11% to A$2.47, and Unibail-Rodamco-Westfield (URW), which closed 3.55% lower at A$4.07.

Hong Kong 

The Hang Seng REIT index decreased 0.50% to 5,607.14, while the Hang Seng index fell 1.14% to 25,477.89. 

Most Hong Kong-listed REITs finished trading lower or flat, with Spring REIT (1426) down 2.76% at HK$2.47.

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Benn is a freelance journalist and the publisher of APAC Real Estate. He has reported for the Herald Sun, REFI Europe, S&P Global Market Intelligence, Leader Newspapers, and more.