Many would say Sabana REIT is one of the worst performing REITs listed on the SGX. It is difficult to disagree when we look at the share prices – The FTSE ST REITs Index (performance of a composite of Singapore REITs) has risen 20% in the past 5 years while Sabana REIT has plunged 51%:

You must have asked why, since REITs are believed to be relatively ‘safer’ instruments than other kind of stocks. Below are the likely reasons for the poor performance of Sabana REIT. 1) Distributions Per Unit (DPU) has been declining. REITs investors want dividends and it is a principal criteria they look out for. Sabana REIT has declining DPU over the past few years. Investors would generally avoid the REIT and Unit Holders would even dump it to deploy their capital to REITs with better outlook. This creates selling pressure on Sabana REIT and prices get transacted ......