Singapore REITs in 2025: Why Overseas Assets Are Driving Dividend Yields

TL;DR

• Singapore REITs (S-REITs) with overseas exposure, such as Cromwell European REIT (CLINT) and Stoneweg Europe Stapled Trust (SERT), are sustaining momentum despite high interest rates.
• CLINT offers a yield of 6.8%, while SERT delivers a stronger 8.5–8.8% yield.
• In the latest half-year, SERT reported S$97.0m in NPI, S$155.7m in revenue, and a DPS of S$0.0950.
• Strategic asset recycling, rental growth, and tenant diversification underpin these REITs’ resilience.
  

The Resilience of Singapore REITs

Despite global economic uncertainty and elevated financing costs, S-REITs with overseas assets are standing out. Supported by underlying rental growth and strategic portfolio management, trusts like CLINT and SERT are delivering income resilience and growth, while many domestic-heavy REITs grapple with muted demand and refinancing risks.

According to REITsavvy’s June 2025 update, the sector as a whole trades at around 24% below fair value, while the average trailing twelve-month (TTM) yield stands at 6.03%

Overview: REIT Landscape and Why Overseas Exposure Matters

Singapore REITs (S‑REITs) traditionally attract income‑seeking investors due to tax advantages and stable distributions. Still, amid rising volatility in domestic demand and interest rates, the appetite has shifted slightly toward REITs with overseas holdings, which now dominate Singapore's REIT market.

According to REITsavvy (June 2025), REITs are broadly undervalued—trading at around 24% below fair value (or only 5% if using weighted averages), with an average trailing twelve‑month (TTM) yield of 6.03%.

Spotlight on CLINT and SERT

Cromwell European REIT (CLINT)

• Yield: 6.8%, annualised DPU of S$0.0794.
• Portfolio: Diversified across Europe, mitigating geographic and tenant concentration risk.
• Performance: Stable distributions backed by multi-jurisdictional rental streams.

Stoneweg Europe Stapled Trust (SERT) 

• Yield: 8.5%–8.8% (forward yield).
• Net Property Income (NPI): S$97.0m in 1H FY2025 (up 2.2% YoY).
• Gross Revenue: S$155.7m (up 1.1% YoY).
• Distribution per stapled security (DPS): S$0.0950, down 7% from the prior year.
• Distributable Income: S$53.2m, reflecting higher interest expenses.

What’s Driving Momentum?

• Asset Recycling & Efficiency: SERT has disposed of non-core assets in Italy and Poland for ~S$11.3m, redeploying capital into higher-yielding opportunities.
• Positive Rental Reversions: SERT secured a 2.8% rental reversion in FY2024, underscoring pricing power despite headwinds.
• Diversified Tenant Base: Both CLINT and SERT spread exposure across markets and industries, lowering vacancy and refinancing risks.

Sector-Wide Performance Context

The S-REIT index rebounded strongly in 2024, with the iEdge S-REIT Leaders Index up 10% over three months, outpacing the Straits Times Index’s 1.7% gain.

Today, yields average 6%, with nearly half of all listed S-REITs exceeding 7%. For long-term investors, valuations remain compelling.

Snapshot of CLINT vs SERT

Insights for Singaporean Commercial Investors

• Income seekers: CLINT offers a stable ~7% yield, while SERT provides higher income (~8.5%+) albeit with greater sensitivity to financing costs.
• Risk awareness: SERT’s 7% DPS cut highlights the impact of debt servicing; sustainability depends on managing gearing and maintaining rental reversions.
• Valuation appeal: With Price/NAV ratios at ~0.76 across the sector, investors could benefit from both yield and potential capital gains if interest rates stabilise.

Frequently Asked Questions (FAQ)

Q1: Are high REIT yields sustainable in 2025?
Not always. For instance, SERT’s yield remains high, but DPS fell 7% YoY due to higher financing costs. Sustainable yields depend on rental growth, asset quality, and leverage.

Q2: Why focus on overseas REITs instead of Singapore-only REITs?
Overseas REITs like CLINT and SERT diversify risks across markets and tenant bases, providing resilience against domestic cyclical downturns.

Q3: What are the risks for Singaporeans investing in overseas REITs?
Currency fluctuations, foreign regulatory changes, and refinancing risks can impact returns, though diversification helps cushion against local downturns.