At its current unit price of S$0.65, EC World REIT (SGX: BWCU) has a dividend yield of around 9% (technically known as distribution yield for REITs).
EC World REIT’s distribution yield looks attractive, on top of the fact that the REIT can ride on the online retail sector growth in China.
However, we shouldn’t buy REITs based on distribution yields and growth factors alone.
Here, let’s explore holistically using a 10-step REIT investing framework to determine if EC World REIT is a worthy investment.
As a summary, here are the 10 steps I use to pick the best Singapore REITs:
Growth in Gross Revenue and Net Property Income Growth in Distribution Per Unit Property Yield of Between 5% and 9% Gearing Ratio of Below 40% Interest Coverage Ratio of Above 5x Healthy Portfolio Occupancy Rate Positive Rental Reversions Presence of Growth Prospects Acceptable Price-to-Book Ratio Distribution Yield