SINGAPORE: Singaporeans looking for better ways to grow their retirement savings are turning to Real Estate Investment Trusts (REITs) instead of traditional options like the Central Provident Fund (CPF) and Singapore Savings Bonds (SSB).
The CPF Ordinary Account (OA) and SSB offer interest rates lower than the current inflation rate of 3.6%, which means they may not keep pace with rising prices.
For those considering alternative investments, The Smart Investor identifies four Singapore REITs providing higher dividend yields than CPF OA and SSB.
1. Frasers Logistics & Commercial Trust
Frasers Logistics & Commercial Trust owns various properties across different countries valued at S$6.7 billion. Despite seeing a slight drop in earnings in 2023, it still offers a good return on investment with a yield of 6.6%.
In the first quarter of 2024, it showed positive signs of growth with high occupancy rates and strong rental income.
FLCT recently announced it’s buying four industrial properties in Germany from its sponsor, Frasers Property Limited, which will boost FLCT’s gearing to about 32.5% and is expected to increase its DPU.
2. CapitaLand Ascendas REIT
CapitaLand Ascendas REIT is Singapore’s biggest industrial REIT, managing 232 properties worth S$16.9 billion. Though its earnings dipped due to increased costs, it still offers a decent yield of 5.5%.
It remains an attractive option, with many ongoing projects worth around S$551 million to improve its property portfolio.
3. Mapletree Industrial Trust
Mapletree Industrial Trust has a portfolio spread across different countries, valued at S$9.2 billion. Despite a slight drop in earnings recently, it still offers a yield of 5.8%.
With stable rental income and almost 80% of the REIT’s loans having fixed rates, it helps lessen the impact of rising interest rates, providing stability and potential for growth.
4. Keppel DC REIT
Keppel DC REIT focuses on data centres worldwide, with assets valued at S$3.7 billion. Despite facing challenges in 2023, it still offers a yield of 5.5%.
With a high occupancy rate and plans for further growth, it’s an option worth considering.
While these REITs offer better returns compared to CPF OA and SSB to provide an opportunity for Singaporeans to grow their retirement savings despite the current economic challenges, as always, it’s always up to you to decide. /TISG
Read also: 4 Singapore REITs with higher dividend yields than CPF OA’s 2.5%
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