In Singapore these days, in most equity investment circles (arguably), you’ll be hard pressed not to hear the term “REITs” mentioned, at least in passing. With a myriad of different types of REITs available for public trading on the SGX – think: Retail, Office, Industrial, Hospitality etc…-, there naturally has been quite a lot of interest generated viz the ability to own a ‘small piece of your favourite property’, via unit holdings in REIT stocks.
While visibility of the REIT itself is generally a given, not many people actually know what the investment team actually does, over and above….“investments I guess”.
Over here at Joy Management Services Pte Ltd, we are fortunate to have an ex-REIT Investment Analyst on board, so here’s a quick and dirty summary of what the job entails in general, although it may differ from REIT to REIT:
- Investment research –
- Analysing property-related trends (think: supply and demand; footfall; keeping up to date on tenancies etc)
- Analysing macroeconomic data (GDP growth trends, key policy thrusts etc)
- Financial modelling –
- Discounted cash flow (DCF), relative valuation, income capitalisation approaches
- Property Feasibility Analyses –
- Analysing information memorandums from agents, developers and making conjectures (backed by research and analysis) to the investment committee
- Financial & legal due diligence –
- Entering data rooms to verify the accuracy of figures provided (or obtain additional information needed for the model)
- Vetting legal contracts / documents (occasionally)
- Meeting with agents / bankers / investors
- Board meeting preparation –
- Presentation decks / documents detailing financial performance, investment pipelines, other REIT-specific updates