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Singapore REITs Rethink Retail As E-commerce Booms, Says S&P Report

Singapore REITs Rethink Retail As E-commerce Booms, Says S&P Report

October 14, 2021 – Singapore’s retail REITs are heading for a reckoning with the rise of e-commerce. This is forcing landlords to recalibrate their tenant mix and incorporate digital channels. S&P Global Ratings expects that a failure to adapt may lead to lower occupancy, revenues, and ratings.

The COVID-19 outbreak has amplified a global secular shift toward online shopping, and this includes Singapore. During the city’s “circuit breaker” period (April 7, 2020 to June 1, 2020), when the government imposed its most stringent social restrictions, the proportion of online retail sales to total retail sales was more than triple the pre-pandemic level.

This is according to a report published today, titled, “Singapore REITs Rethink Retail As E-commerce Booms.” 

“We believe consumers’ gravitation toward e-commerce will continue,” said S&P Global Ratings credit analyst Yijing Ng. “Retail landlords will need to enhance their value proposition to both retailers and consumers to stay relevant.”

The report discusses how Singapore retail REITs will tackle the growing e-commerce threat, including proactive tenant mix management and adoption of omnichannel retail.

“Suburban retail landlords will likely fare better than their city-center peers due to their tenant mix and their proximity to work-from-home professionals,” said S&P Global Ratings credit analyst Fiona Chen.

Read more here..

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