S’pore REIT market can surpass Japan’s in 10 years: Association chief

SINGAPORE - The real estate investment trust (REIT) sector in Singapore has the potential to surpass that of Japan as the biggest by market capitalisation in Asia, said Mr Sonny Tan, the chief executive of the newly launched REIT Association of Singapore (REITAS).

“The REIT industry in Singapore has grown considerably over the last 12 years since the first listing... Today, Singapore is a fairly well-established international hub and we believe that with the region growing very strongly, there’s a lot more opportunities for us to attract more REITs to be listed in Singapore,” Mr Tan told TODAY on the sidelines of the association’s launch today (Nov 17).

“As it is, we already have quite a number of regional and international REITs listed here, so we believe our small domestic size is not a constraint. And I think we may even be able to surpass Japan in 10 years’ time as the biggest REIT market in Asia,” he added.

Currently, Singapore has 33 listed REITs with a total market capitalisation of more than S$60 billion, while Japan’s 46 REITs have a market value of about US$86 billion.

REITAS wants to play a leading role in that growth story by engaging stakeholders to strengthen the industry’s regulatory and operating environment, as well as educate the public about investing in this segment.

“We need a body to focus on the very specific needs of the REIT industry in Singapore, as the challenges faced by the industry is very different from other asset classes and other real estate-related businesses,” said REITAS president Chua Tiow Chye.