UI Boustead REIT Drops 8.5% in SGX Debut as Middle East Conflict Hammers Confidence

Bombs dropping in Tehran are causing shockwaves in Singapore as worried investors drove down the equity price for a long-planned Singapore REIT in its first day of trading. 

Units in UI Boustead REIT, a listed trust backed by Macquarie Asset Management fell by 8.52 percent in their first day of trading on the SGX to settle at S$0.81 ($0.63) each at closing, after starting Thursday at S$0.805. The Straits Times Index declined 0.17 percent on Thursday.

UI Boustead REIT raised approximately S$973.6 million ($762 million) from the IPO, with cornerstone investors having subscribed to 429,181,800 units which attracted S$377.7 million in capital. The REIT’s debut is the largest for a real estate trust on the SGX since July last year, and is expected to be the biggest on the exchange this year. After pricing its units at S$0.88 in the offering, the placement tranche was 3.3 times subscribed and the public offer was 2.9 times subscribed, according to a statement from the trust’s manager. 

Analysts speculated that risks from the latest Gulf war may have unsettled some early investors in the REIT, with more than 102 million units in UI Boustead REIT changing hands between the start of trading at 2:00 PM and the closing bell on Thursday – equivalent to 7.5 percent of the trust’s total equity.

Tough Timing

In announcing the offering’s trading debut, the management of UI Boustead REIT seemed to acknowledge the challenges created by the sudden change in the market.

“We are deeply grateful to our unitholders for their support and trust in UI Boustead REIT,” Tan Shu Lin, chief executive officer of UI Boustead REIT’s manager said in a statement. This strong investor interest amidst the current macroeconomic conditions reflects the confidence that our portfolio can deliver stable and resilient cashflows, with secured organic growth from built-in rental escalations, as well as a clear visible pipeline of opportunities to grow the portfolio.”

The trust offers investors a chance to buy into a portfolio of 23 industrial properties across Singapore and Japan, with the REIT having first refusal rights on new projects developed by its sponsor, UIB Holdings. 

The seed portfolio includes 21 leasehold assets in Singapore and two freehold assets in Japan, with an agreed property value of S$1.9 billion as of 30 September 2025. Among the trust’s business park assets are 29 Media Circle in Singapore’s Mediapolis and 1 One-North Crescent business park, which serves as the Southeast Asia headquarters of gaming peripherals maker Razer.

The trust’s assets also includes industrial buildings 8 & 12 Seletar Aerospace Heights and 11 Seletar Aerospace Link. The seed portfolio has a committed occupancy rate of 89.4 percent and a net lettable area of 5.3 million square feet (492,386 square metres).

At the REIT’s opening pricing it was offering investors a chance to enjoy a projected yield of 7.8 percent, with that figure having sweetened to around 8.5 percent following the drop in unit price on Thursday.

Market Shift

The first day performance for UI Boustead REIT could dampen enthusiasm in Singapore’s real estate investment trust market, according to analysts, after some 2025 success stories.

“This outcome is likely to cause an overhang in the S-REIT IPO pipeline in the near term, as investors reassess geopolitical risks. Fundraising and placement will require strong value propositions,” Vijay Natarajan, real estate and REIT analyst at investment bank RHB Singapore told Mingtiandi.

The Singapore REIT market had been enjoying a long-awaited recovery after NTT DC REIT in July last year raised $773 million in the biggest debut of a listed trust on the SGX in a decade. 

That IPO was followed in September by the S$771 million listing of rental housing specialist Centurion Accommodation REIT, with that trust being 16 times subscribed and closing its first day of trading up more than 9 percent from its opening price.

An index which tracks REITs on the Singapore exchange had risen to as high as 1,139 in late October last year after standing at just over 1,000 one year ago. The iEdge S-REIT Index has now dropped from 1,112 on 26 February to 1,052 on Thursday.