Average cost of equity (COE) for S-Reits

[Hock Meng]

Dear Research

Good day.

May I know what are the breakdown of each sector average cost of equity within the S-Reit universe? For example, for retail, office, industrial, foreign, etc. Is there a breakdown of S-Reit sector average cost of equity (%) calculations?

Thank you.

[Research Department]

Hi Hock Meng,

Thank you for your question on Stocksbnb.com. A good proxy to determine the approximate average cost of equity for a subsector would be to use the trailing yield of the subsector as a whole. After all, this would reflect the “cost” to the REITs if they were to place out new shares at current price. As of current, the average sector trailing yield for the various subsectors would be, in ascending order, healthcare 5.5%, office 5.7%, hospitality 6.2%, retail 6.6%, and industrial 6.9%.

[Hock Meng]

Thank you.

[Author]

Posts