Data Centres and Healthcare Assets Lead S-REIT Market in 2024 Returns

In 2024, data centres and healthcare-related real estate emerged as the top-performing sectors in Singapore’s Real Estate Investment Trust (REIT) market, according to analysis by global real estate consultancy Cushman & Wakefield.

Strong Sectoral Performance Amid Broader Volatility

Data centre REITs registered the highest total return of 9.7%, outpacing all other property segments. Healthcare REITs followed with a solid 6.9% return, showcasing their resilience and appeal to investors amid economic uncertainties and a growing digital economy. These sectors benefited from long-term structural trends such as digital transformation and aging demographics, which have underpinned stable cash flows and demand.

By comparison, the overall iEdge S-REIT Total Return Index recorded a modest 3% return for 2024, as reported by the Singapore Exchange (SGX). Despite broader macroeconomic headwinds, the REIT sector showed encouraging signs of recovery in select niches.

Retail and Office REITs Show Signs of Stabilisation

Although returns for retail and office REITs remained in negative territory—-2.1% and -5.1%, respectively—these figures represent a significant improvement from their steeper losses in 2023. The rebound in foot traffic, tourism, and flexible work arrangements contributed to this stabilisation.

Diversified, Industrial and Logistics REITs Under Pressure

In contrast, diversified REITs posted a further decline with total returns at -5.6%, while industrial and logistics REITs saw a sharper contraction at -7.9%, reflecting challenges such as oversupply, higher financing costs, and evolving tenant demands in warehousing and production spaces.

REIT Leverage Trends and Regulatory Adjustments

Singapore REITs maintained an average leverage ratio of 39.3% in 2024, up 1.2 percentage points year-on-year. Despite the increase, regulatory refinements introduced by Singapore’s financial authorities have provided REITs with more operational flexibility while upholding sound financial practices.

These measures included harmonisation of leverage ratio requirements across the sector, which are aimed at supporting sustainable growth without compromising investor protection.

Regional Market Share and Outlook

As of the end of 2024, Singapore—along with Hong Kong and Japan—accounted for over 70% of the total REIT market share in Asia, reinforcing the region’s status as a key player in the global REIT landscape.

Looking ahead, the performance divergence across property types highlights the need for strategic allocation in REIT portfolios, especially towards sectors aligned with long-term megatrends such as digital infrastructure and healthcare.

Algene Toh

Senior Real Estate Salesperson

Asset Investment Brokers Pte Ltd

Email: admin@bsr2.com

Phone: +65 9008 8002

Visit us: profile

Disclaimer: The information presented on BSR2.com is intended for general informational purposes only. It does not constitute legal, financial, investment, or real estate advice and should not be relied upon as such. While every effort has been made to ensure the accuracy, reliability, and completeness of the content at the time of publication, all data is derived from publicly available sources and may be subject to change without notice. BSR2.com makes no representations or warranties of any kind, express or implied, regarding the suitability, timeliness, or accuracy of the information provided for any specific purpose. Users are strongly encouraged to seek independent advice from qualified professionals before making any decisions based on the content found on this website. BSR2.com shall not be held liable for any loss, damage, or consequence, whether direct or indirect, arising from the use of or reliance on the information provided. The content is intended as a general guide and does not take into account individual circumstances.