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NRA Capital Pte Ltd

Written by: NRA Team

Wednesday 29 Oct 2014

Real Estate - Sector Focus


Much has been written about the state of the local residential, commercial and industrial property markets. But less attention has been paid to real estate investment trusts (reits), which are a viable alternative and less vulnerable to volatile price movements. We speak to the people at Mapletree Investments Pte Ltd for more on reits and why one should consider diversifying into them.

  1. What are reits? 
  2. Are all management fees charged at the same percentage? Does a higher charge imply the manager is better and the reit a safer one?
  3. Why would I consider investing in a listed reit?
  4. How safe will my investment in a listed reit be?
  5. One comment frequently heard about listed reits is that the manager’s fees are quite high and the initial forecasted yield is already accounted for in the IPO proceeds, but the yield could drop considerably two years after listing. Is this true? How often does the dividend policy change?
  6. Are there limits set on the gearing and debt maturity of the reit?
  7. Now that I’ve decided to invest in a reit, what are the factors to consider before choosing which one? Any risk factors I should be aware of?
  8. How should an investor assess a sponsor and the strength of the sponsor?
  9. There are industrial, commercial, retail and hospitality reits. Would a good strategy be to hold one of each in my portfolio or choose a sector that I think will do well in the coming years and invest in a few within that sector instead?


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