Lately, I noticed a wide spread between the traded price of some S-Reits and their net asset value ("NAV") per unit. The table below shows the top ten S-Reits with the highest Price/NAV ratio and premium over NAV.
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| Data as at 21 January 2015. |
I understand if investors are willing to pay a premium for great management and positive growth prospects of the REIT. But I cannot fathom anyone willing to fork out current prices for some of the S-Reits. Perhaps I am neither bold nor ambitious enough to go for the kill at 30 per cent premium, despite how fantastic the REIT may seem.
The persistent bull run had also led to compressed yields. I'm seeing distribution yields hitting below 5 per cent. This means the markup against the benchmark SPDR Straits Times Index ("STI") ETF dividend yield is just 200 to 250 basis points. I wonder if it ...
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