Hunting for robust 9% yield? Look no further!

Viva Industrial Trust (SGX Code: T8B) is set to buck the trend of weak industrial property market and distribute higher dividend yield of 9.7% for 2017. This is well above the average 7.3% yield investors are expected to receive from the Singapore Real Estate Investment Trusts (S-REITs) sector. Key developments that will support the stronger payout include:

  • Acquisition of a logistics building (30 Pioneer Road) in April 2016
  • Completion of asset enhancement of Viva Industrial Park in 4Q16, with major success on its retail lease space
  • Proposed acquisition of brand new logistics warehouse (6 Chin Bee Avenue) in October 2016

The trust is trading at 0.93x Price-to-book (P/B), in line with its S-REIT peers, despite its higher expected dividend yield.

Key risks on Viva Industrial Trust are:

  • Higher gearing and interest costs
  • Existence of income support
  • Asset revaluation risks from higher cap rates

For more information on Viva Industrial Trust and its financial performance, please click here.