REITS ( Real Estate Investment Trust )

Many times we speak to our crew mates from countries like South East Asia or South Asia, you’ll hear them talking about acquiring lands, and building houses. This is not applicable to the sg grounds. We are not talking about purchasing condos or private properties because a typical sgseafarer cant afford it yet. So the nearest we have to being a landlord is to acquire REITS.

Real estates investment trust. Examples of real estates can be categories into
1) Retails > our shopping malls,
2) Industrial – warehouse, manufacture etc
3) Commercial – offices the one u see the CBD
4) Healthcare – hospitals
5) Data centers

So who owns these properties? I’m pretty sure you hear of capitaland, fraser properties, City Dev, mapletree etc. And the point is that we can be part of it.
Why REITS, because 90% of the rental profits is obligated to be distributed back to the shareholders, Tax free.
It doesn’t matter how little you have,1k or 10k, as long you purchases the equalities( stocks) of the Reits, you are the shareholder. The money that we receive Quarterly or semi annual from REITS are call Dividends.

These dividends ranges from 3 – 6% of your capital per year, BUT your capital is subjected to the volatility of the stock market, if the stock market crashes the next day, your capital crashes together. IF the stock market shot up, your capital gain as well. However, for strong reits, dividends will come in no matter how the stock market performs.

And if youre looking into retirement planning, dividends are one of the passive income, So imagine if i’ve have 200k into REITS generating 5% yield, that is 10k/Year, passive. Dividends can be always reinvested, thus compounding, doing a exponential gains in a long long time provided you start early.
However, when a reits offers high dividends,over 10% yield, just be very aware, high dividends doesn’t mean the reit is solid, its share price may be depreciating.

These are some examples of REITS to look at
CapitaLand mall trust (going to be renamed CapitaLand integrated commercial trust )
Fraser centerpoint
Ascendas reits
Parkwaylife
Keppel DC reit