The Iran war has disrupted expectations for a cyclical rebound in Singapore-listed REITs, says former financial journalist Ven Sreenivasan.
Singapore has built one of the world's largest REIT markets with 41 REITs and property trusts worth S$104 billion, representing nearly 10% of the stock market. While the Straits Times Index gained 25% over the past year, S-REITs declined 3%.
The war in Iran has forced the US Federal Reserve to pause rate cuts, raising concerns about renewed interest rate hikes if energy shocks fuel global inflation. Rising financing costs could pressure REITs with significant bank borrowings.
Market outlook includes unpredictable geopolitics, potential energy shocks, supply chain disruption, slowing growth, and rising interest rates. However, Temasek-backed S-REITs maintain stronger balance sheets and diversified portfolios resilient to market events.