Do you want to take advantage of what industrial REIT Singapore offers? If so, it always pays off to understand what you’re dealing with in the first place. After all, there is no essence of leveraging something you’ve never heard about.
Fret not since we are here to lend you a helping hand and ensure you get the most from industrial reit Singapore companies. In this simple guide, we will take you through some of the things you need to know about industrial REITs.
What Are Industrial REITs?
Before going any further, it pays off to know what we are dealing with in the first place. In a nutshell, industrial REITs are companies that own and manage real estate properties used for manufacturing, production, storage, and distribution of goods. Under the structure in which industrial REITs operate, it requires them to pay at least 90% of their net revenues as dividends to shareholders.
Any invested investor can become shareholders in industrial REIT Singapore by buying shares of the company in the public exchange market. The guaranteed incomes, combined with the underlying real estate assets, make industrial REITs attractive to investors looking to get share of the real estate market.
How Industrial REITs Work
By now you should be aware of the fact that industrial REITs are real estate investment trusts that are involved in the management, ownership, and leasing of industrial properties. This can either be for setting up factories, distribution centers, warehouses, or e-commerce fulfillment centers.
In most cases, industrial properties are situated outside the central business district since they require a large space for setting up machinery and loading tracks. These can exist as a cluster of industrial buildings within an industrial park or as a standalone building leased to an individual or multiple events.
Compared to other types of REITs, industrial REITs offer investors a way to invest in the real estate sector without building or purchasing industrial buildings on their own. REITs allow investors to contribute funds to a pool, which is then leveraged in purchasing buildings or acquire land on which to set up industrial buildings or parks.
In return, an investor will get a return on their capital injection through dividends and appreciation of the real estate property. They can also invest in REITs as a way of diversifying their investments since industrial REIT Singapore invest in a diverse range of portfolios comprising fixed equity, fixed income, and cash.