S-REIT: CLSA Overweights sector on cheap refinancing, yield compression and strengthening SGD which will attract US$-based investors. Expects DPU growth of 1.0-5.5%. S-REITs are shielded from residential policy risks and favoured sectors are hospitality followed by office and then retail...
House believes higher valuations justified with acq growth potential driven by lower funding costs. Current yield spread is still 26bps higher than mean and 244 bps above peak which offers room for upside. Top buys are Suntec Reit (TP$1.85), MLT (TP$1.10), K-Reit (TP$1.62).
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