Retail REITs hog the spotlight as hospitality players stumble

Thanks to stable occupancy rates and higher rents.

Retail REITs reported a surprisingly resilient performance while their hospitality counterparts stumbled in the first quarter. 

OCBC Investment Research analyst Andy Wong noted that despite stifling issues such as manpower dearth and weak tourist arrivals, Singapore-focused retail REITs still booked positive rental reversions and largely stable or slightly lower occupancy rates.

Wong noted that rental uplifts ranged from 3.8% to 17.5% for retail REITs, while tenants’ sales data held up better for REITS with suburban malls exposure compared to those focused in the Orchard Road Area.

In contrast, hospitality REITs reported lower revenue per available room (RevPAR) across the board. This was caused by the absence of big biennial events, lacklustre corporate demand and weak tourist arrivals.