Dear readers, it has been announced that SoilBuild Business Reit will be taken private. This is yet another privatisation of Singapore’s Reits and Trusts which I am not surprised at all.
My opinion is that there are quite a number of Reits and Trusts here on the Singapore stock market so much so that for interested Reit investor, he can expect to find dis-uniform performance from all these Reits. Why do I say so? Well, the main objective of a Reit and Trust investor is to obtain a steady stream of dividend income. But looking at some of the Reits and Trusts here, their stock prices have gone down to humble levels and same as with the dividend yields which are not high or even may have become nil.
For growth, Reits and Trusts always have to increase the assets under management (AUM) often through mergers and acquisitions. Often these M&A activities spell risk for Reits and Trusts. It is quite often that M&A activities erode the value of some of these Reits and Trusts.
I expect a further consolidation of Singapore Reits and Trusts. There are just so many of them right now and there are a number which are not doing well at all.