Screenshot from UI Boustead REIT Prospectus cover
It is finally here: the initial public offering (IPO) for UI Boustead REIT (which I had mentioned here before). Below are some of the key highlights from the prospectus:
IPO Application Highlights
- Offer price of SGD 0.88 per unit.
- Total offering size of around 677.2 million units, of which 33.9 million are offered to the public, with the rest in the placement tranche.
- Offer period from 5 Mar 2026 till 10 Mar 2026 at 12 noon.
Asset and Lease Highlights
- 23 properties in the REIT: 21 in Singapore (representing 71.2% of agreed property value) and two in Japan (representing 28.8% of agreed property value), focusing on logistics, industrial and business spaces.
- Portfolio weighted average lease expiry (WALE) of 5.8 years.
- Committed occupancy of 89.4%.
Financial Highlights
- Net Asset Value (NAV) of SGD 0.85.
- Forecasted yield is projected for 7.4% for 2026 and 7.8% for 2027.
- Aggregated leverage (gearing) of 37.9%, with interest coverage ratio of 4.7 times.
Selected Analysis
It is noted that most of the figures shown above such as the NAV and occupancy rate were as of 30 Sep 2025, which was almost six months ago.
The first number that got my attention was the relatively low occupancy rate of 89.4%, likely attributed to the Japanese properties (one in Kansai with a committed occupancy rate of 76.7%, and another near Tokyo with 76.5%). However, the prospectus had mentioned the occupancy would reach 99.4% for the Kansai property by 2027, and the one in Tokyo had reached 100% as of 20 Feb 2026. This information at least gave some assurance on the occupancy issue.
For an overall comparison of their yields, gearing and WALE, I would use two REITs that are similar in terms of property type and with assets in Singapore and overseas (Figure 1):
REIT | Yield (%) | Gearing (%) | WALE (years) |
UI Boustead REIT | 7.4 (projected 2026) | 37.9 | 5.8 |
AIMS APAC REIT | 6.79 | 36.6 | 4.1 |
Frasers Logistics & Commercial Trust | 6.13 | 34.8 | 4.9 |
Fig.1: Yield, Gearing and WALE figures for UI Boustead REIT, AIMS APAC REIT and Frasers Logistics & Commercial Trust. Data for AIMS APAC REIT and Frasers Logistics & Commercial Trust obtained from Yahoo Finance and their respective recent financial presentations.
UI Boustead’s projected yield, gearing and WALE are on the higher side when compared with its peers.
The tenant mix of UI Boustead REIT’s properties are diversified in terms of lease, tenant profile (single or multi tenanted) and sector/industry, with the highest net property income contributor (a leading aircraft manufacturing company) at 8.6%, thus reducing tenant concentration risk.
The Bedokian’s Take
UI Boustead REIT is another industrial, logistics and business space to consider on top of the two which I had used for the comparison in Figure 1. At SGD 0.88, the IPO price is slightly above the NAV of SGD 0.85 (+3.5%), but I find this premium acceptable. For those who did not have such REITs in their portfolios and wished to venture into these property types, this may be a good start. Personally, however, I may give this a skip as we have AIMS APAC REIT and Frasers Logistics & Commercial Trust in our portfolio.
Take note that the public tranche is relatively small (only around 5% of the entire offer), and being a REIT there would be many bidders for it, so one may need to go to the open market should one could not get their desired allocation.
Disclosure
The Bedokian is vested in AIMS APAC REIT and Frasers Logistics & Commercial Trust.
References
UI Boustead REIT Prospectus - https://links.sgx.com/FileOpen/UI_Boustead_REIT_Prospectus_(5_March_2026).ashx?App=IPO&FileID=6738
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