Japan Foods Holding: Squeezed Dry by Sky-High Rents

Japan Foods Holding Ltd (JPFH) is a familiar name to anyone who has eaten at Ajisen Ramen or its sister brands in a Singapore heartland mall. It's a homegrown F&B success story that has been around for close to three decades. But familiarity and fondness aside, the numbers tell a story that investors should read closely before buying in — and the company's own annual report gives away why.

Boxed in by its own positioning

JPFH's restaurants sit squarely in the low-to-low-middle price segment, with menu items typically priced between $10 and $20. That positioning has been the brand's strength for years — affordable, familiar Japanese comfort food for the everyday consumer. But it is also becoming its biggest vulnerability.

In its FY2026 annual report, the company points to a structural shift in the competitive landscape: an influx of well-capitalised Chinese F&B brands entering Singapore has pushed up both rental and manpower costs across the board. These new entrants aren't just competing for customers — they're competing for the same shop units and drawing from the same limited pool of local and foreign service staff. Backed by deep domestic networks, they are, in the company's own words, willing to spend aggressively to win a foothold in Singapore as a springboard into the wider region.

For a premium or mid-to-premium operator, rising costs can often be passed on to customers who are less price-sensitive. JPFH doesn't have that luxury. Its entire brand promise rests on being the affordable, everyday option — and a $10–$20 price band leaves very little room to raise prices without eroding the value that keeps customers coming back. In short, JPFH is absorbing rising costs from a fight it didn't start, in the one segment where it has the least pricing power to fight back.

The financial results reflect this squeeze. As the chart below shows, JPFH swung from modest profitability in FY2022 and FY2023 into consecutive years of losses from FY2024 onward — with the bottom line deteriorating to a net loss of S$7.9 million in FY2025, before narrowing slightly to a S$6.7 million loss in FY2026.

Its two consecutive years of losses after two years of modest profits lines up with the timeline of increased competitive pressure described in the company's own commentary.

Management's own playbook: survive, don't scale up

Perhaps the most telling signal for investors isn't in the numbers — it's in management's stated strategy. In its latest AGM, rather than moving upmarket to escape the cost pressure, management has been explicit that JPFH will not enter the premium mall restaurant segment. The strategy is to stay in its current lane and manage through the China competition via store rationalisation — trimming the underperforming parts of the network. JPFH expects more local F&B brands to close down due to the competition from China.

That's a defensible survival strategy, but it's important for investors to understand what it does and doesn't achieve. Store rationalisation reduces the drag from loss-making outlets, but it doesn't address the underlying cost inflation hitting every remaining store. My expectation is that even after closing more outlets, the realistic outcome is only a return to breakeven — not a return to the healthier profit margins JPFH posted back in FY2022–FY2023. For a company that once used store expansion as a growth story, the current chapter is essentially about shrinking to survive, as a homegrown brand absorbing the cost of a much more capital-intensive wave of competition.

That is a meaningfully different investment case than "turnaround story." Breakeven is a floor, not a growth trajectory — and it assumes the competitive and cost pressures don't intensify further.

The cost structure means there's no easy lever to pull

The clearest illustration of why JPFH is structurally stuck comes from its own cost disclosure. In response to a shareholder query, the company broke down its FY2026 expense base as follows:

JPFH Cost Breakdown FY2026

Rental and employee compensation together account for roughly 73.5% of these key cost items — and both are precisely the two cost lines that management says are being driven up by the influx of new, cash-rich competitors. Food ingredient cost, by contrast, is only around 18.3% of the base. Hence for many causal chains in Singapore, store and labour is the cost that kills.

This matters because it defines the limits of what operational discipline can achieve. Even if JPFH runs an exceptionally tight kitchen and squeezes every dollar out of its food sourcing (which the CEO claims he does, and does it far better than the China chains), ingredient cost is simply too small a slice of the pie to meaningfully move overall margins. The real cost drivers — rent and labour — are largely outside the company's control, dictated by a property and labour market that competitors are willing to bid up aggressively to win. Staying in the low-end segment means JPFH is committed to a pricing ceiling it cannot easily raise, while its two biggest cost lines are the ones most exposed to external competitive pressure. That combination is difficult to fix through internal efficiency measures alone.

I do not expect any meaningful upside in the share price. At 10–11 Singapore cents, the company is a "Hold" for me, with no expectations of increasing the stake.

Portfolio Update July 2026: Increasing My Highest Conviction Holdings

Over the past month, I made two large additions to my dividend portfolio by increasing my holdings in NTT DC REIT and Daiwa House Logistics Trust and a smal addition in Asian Pay TV Trust.

These purchases have increased my projected annual dividend income to $100,591.61, while  improving the overall quality of my income portfolio.

Buying More of What I Understand

As my portfolio grows larger, I have become more selective with where I deploy fresh capital.

Rather than constantly searching for the next high-yield stock avaliable in SGX, I rather increase my exposure to businesses that I have already spent considerable time researching and have high conviction in. Sometimes the best investment idea is not finding something new, but simply buying more of what you understand well.

NTT DC REIT continues to fit that description. The long-term demand for data centres remains supported by structural trends such as artificial intelligence, cloud computing and digitalisation. Together with healthy rental reversions, a quality sponsor and a visible acquisition pipeline, I believe it remains one of the strongest REITs listed on SGX today.

Why Daiwa House Logistics Trust

Demand for modern warehouses is increasingly supported by supply chain optimisation, third-party logistics providers, manufacturing inventory and changes to Japan's transportation industry. Coupled with positive rental reversions over the past few years, I believe the trust offers attractive long-term income potential while providing diversification away from my other REIT holdings.

Recycling capital

I exited my entire position in Riverstone Holdings. While it remains a good company, I felt my capital could be better deployed to the above 02 REITs, my trust in how this would further strengthen my recurring dividend income.

Looking ahead

Looking back over the past year, my portfolio has gradually shifted from accumulating many different dividend stocks to concentrating capital into my highest-conviction ideas. It is definite that 2027 will be a year where I experience a $100,000 annual dividend inflow.

Dividend (Year to Date)

USD $13,060

HKD $22,599.18 (Alibaba Dividend during this update)

SGD $15,317.38 (NTT DC REIT Dividend during this update)

Why BYD's Profit and Share price Slide Isn't Over: Supplier Rules from CCP

BYD just posted its fourth straight quarter of falling profits. Share prices fell. However, this decline will continue and normalise only at the end of this year, 2026.

The regulation behind the debt spike

For years, BYD ran one of the auto industry's most aggressive supplier-financing models. It paid vendors an average of 275 days in 2023 and roughly 127 days in 2024, often using its in-house "Dilian" promissory-note platform rather than cash — effectively turning unpaid suppliers into a source of free working capital.

That changed in 2025. Beijing's SME Payment Regulation, effective June 1, 2025, legally caps payment terms at 60 days, and bans forcing smaller suppliers to accept non-cash IOUs as a delay tactic. BYD, along with 16 other major automakers, publicly pledged to comply. By Q3 2025, BYD's payment cycle had collapsed to roughly 57 days.

That's good news for suppliers and for industry health — but it eliminated a multi-hundred-billion-yuan interest-free credit line BYD had been quietly running. The company had to replace it with real, interest-bearing debt.

The Hidden Financing Advantage

• Total debt rose from 40.5 billion yuan at the end of FY2024 to 124.2 billion yuan at the end of FY2025 — a 207% jump — and kept climbing to 144.4 billion yuan by the end of Q1 2026, a five-year peak.
• Short-term borrowings alone surged 72% quarter-on-quarter to 66.3 billion yuan in Q1 2026, which BYD attributed to higher financing needs across the group.
• Long-term borrowings climbed to roughly 61.2 billion yuan by Q3 2025, up more than 640% from the start of that year.

The consequence shows up directly in the income statement. BYD's financial expenses hit 2.1 billion yuan in Q1 2026, up 210% year-on-year — implying a base of roughly 680 million yuan in Q1 2025. That's interest cost that didn't exist a year ago, now eating directly into the bottom line at the same time gross margins are under price-war pressure.

It's likely on a full year basis of 2026, BYD's financial expenses will adversely hit its profits.

The profit trend

Q1 2026 net profit attributable to shareholders fell 55.4% year-on-year to about 4.08 billion yuan, down from 9.15 billion yuan — the lowest quarterly profit since 2023 and the steepest quarterly decline since 2020. Basic EPS fell 56.9% to 0.448 yuan. This extends a streak: Q3 2025 profit fell 32.6%, and full-year 2025 net profit fell 19% to 32.62 billion yuan — BYD's first annual profit decline since 2021. Revenue has now declined for multiple consecutive quarters as the domestic price war and the phase-out of NEV purchase-tax exemptions weigh on volumes.

Price target: 20x forward earnings on the 1Q decline rate

Applying the Q1 2026 vs. Q1 2025 net profit decline (-55.4%) directly to full-year 2025 net profit (32.62 billion yuan) as a proxy for full-year 2026 earnings:

• Projected FY2026 net profit: 32.62B × (1 – 0.554) ≈ 14.55 billion yuan
• Shares outstanding: ~9.12 billion (post the July 2025 bonus share issue)
• Projected forward EPS in HKD: 1.85 HKD per share
• Price target at 20x forward P/E (do note many automobile makers price earnings are 9-12 times, so 20 is a very optimistic projection)

The target price is HKD$37

Against current prices of HK$72.45 (H-shares) as of July 1, 2026, this implies a further 50–60% downside.

One of the Highest-Yielding Singapore REIT Isn't in Any Index and it is Causing Singapore Investors to Lose Out

If you build your Singapore REIT portfolio around the FTSE ST All-Share REIT Index — the benchmark most income investors use, and one that even REITs like Starhill Global REIT measure themselves against — there's a good chance you've never seriously looked at United Hampshire US REIT (SGX: ODBU). That's the problem.

UHREIT currently trades with a dividend yield in the 8% to 9% range, well above the broader S-REIT sector average of roughly 6–7%. For a market where investors chase every extra point of yield, that should put it on every income watchlist. Instead, it sits largely off the radar — and the index is a big reason why.

UHREIT is Singapore-listed, but its entire property portfolio sits in the United States. Its tenants are grocery-anchored and necessity-based retail: strip malls and centres anchored by supermarkets and pharmacies, leased to tenants considered resilient to e-commerce — restaurants, home improvement chains, fitness centres, warehouse clubs. This has kept its income relatively stable even as its unit price has lagged, ironically property revenue has been increasing year on year because of built in annual rental escalations and long WALE.

So Why Isn't It in the Index?

Here's the part that should give investors pause: it's not earnings, tenant quality, or balance sheet stress keeping UHREIT out. It's trading liquidity.

FTSE Russell's index methodology screens for free float and trading liquidity, not just market cap, to ensure constituents can be bought and sold at scale without distorting the price. UHREIT's smaller free float and thin daily turnover don't clear that bar. And low turnover is self-reinforcing: less liquidity means less index eligibility, which means less visibility, which means even less turnover.

This is a structural quirk, not a quality signal. But because so many Singapore income investors use index membership as a shortcut for "is this REIT worth considering," or just buy the REIT ETF, UHREIT ends up invisible to the very crowd hunting for higher yield. In plain sight, Singapore investors are missing out on a 8.4% dividend yielder!

The Cost of the Blind Spot

REIT ETFs that track the index never buy a single unit of UHREIT, no matter how attractive the yield gets, simply because the rules exclude it. Investors who use "is it in the benchmark" as a screen filter it out before ever checking the lease structure or payout coverage. REITs that benchmark themselves against the index never have to stack up against UHREIT's payout, because it isn't part of the comparison set. The result: capital flows toward index members partly because they're index members — not purely because they're the best income vehicles on the exchange. Singapore investors and fund manager lose out on the extra yield and opportunity to outperform Singapore REIT index any time or date of the year.

The Takeaway

If your approach to REIT investing starts and ends with "what's in the index," you may be filtering out some of the highest-yielding options on a technicality that has nothing to do with income quality.

That doesn't mean buy blind, though. Worth noting: UHREIT's illiquidity isn't a case of a thin order book or wide spreads — there's decent volume sitting on both the bid and ask at most price levels. The "low liquidity" here is really low daily turnover, not a shallow market, which is a more benign form of illiquidity. Still, size positions sensibly and do your own homework on debt maturities, occupancy, and currency risk first. But if you've never considered UHREIT simply because "it's not in the REIT index," that's a gap worth closing — the index is a tool, not a verdict.

Singapore's Property Myth: Why REITs Beat Renting out a Property on Pure Math

If you read, watched (or been bombarded) by short form videos by property agents, you would have heard a Singapore gospel: property is the only "real" way to build wealth here. Buy a second condo, rent it out, let the tenant pay down your mortgage, and watch your net worth compound. 

It is also, on a pure mathematical basis, usually the worse trade — once you strip away the emotion and run the actual numbers on yield, leverage cost, tax, and stamp duty. This article walks through exactly why, using a real worked example: a S$1,000,000 portfolio split across ten SGX-listed REITs, compared against the same S$1,000,000 used as a 25% down payment on an Outside Central Region (OCR) condominium that is then leveraged at 75% and rented out.

Comparing an Unlevered Yield to a Levered One — And Still Winning

Here's the asymmetry missed. When people say "property investing is great because of leverage," they're comparing a 75%-geared property to an unlevered REIT portfolio. 

But once you actually run the numbers on (i) Singapore's current gross rental yields (roughly 3.0%–3.8% for private condos in 2026, according to URA-linked data), the cost of financing, the operating drag, and the tax treatment, leverage on a 3.5% gross-yield asset vs (ii) an unlevered REIT portfolio, the maths show REITs win

Setting Up the Comparison

To keep this an apples-to-apples test of capital efficiency, both scenarios start with the same amount of investor cash: S$1,000,000.

Scenario A — REIT Portfolio (Unleveraged) S$1,000,000 deployed directly into a diversified basket of 10 SGX-listed REITs, held with zero leverage, income simply collected as distributions.

Scenario B — OCR Residential Property (75% Leveraged, Rented Out) S$1,000,000 used as the 25% equity portion of a property purchase, with the remaining 75% financed by a mortgage at 2% per annum interest (a realistic low-rate assumption), located Outside the Central Region, rented out at prevailing market rates, and taxed at 15% net of allowable expenses under Singapore's personal income tax treatment of rental income.

The REIT Portfolio: Building the 10-REIT Basket

The portfolio below allocates 60% of capital to four REITs — Keppel DC REIT, AIMS APAC REIT, Lendlease Global Commercial REIT, and NTT DC REIT — split evenly at 15% each, and the remaining 40% across six REITs — Suntec REIT, Daiwa House Logistics Trust, Alpha Industrial REIT (formerly Sabana Industrial REIT), Sasseur REIT, CapitaLand Integrated Commercial Trust (CICT), and CapitaLand Ascott Trust — split evenly at roughly 6.67% each.

Yields below are approximate trailing/forward distribution yields as of mid-2026, sourced from REIT distribution announcements and market data. REIT yields move with unit prices, so treat these as a realistic snapshot rather than a permanent figure.

	REIT	SGX Ticker (approx.)	Sector	Weight	Distribution Yield	Capital Allocated	Annual Income
1	Suntec REIT	T82U	Office / Retail / Convention	6.67%	5.0%	S$66,700	S$3,335
2	Daiwa House Logistics Trust	DHLU	Logistics (Japan/Vietnam)	6.67%	8.0%	S$66,700	S$5,336
3	Alpha Industrial REIT (fmr. Sabana)	M1GU	Industrial	6.67%	7.5%	S$66,700	S$5,003
4	Sasseur REIT	CRPU	Retail Outlet Malls (China)	6.67%	9.1%	S$66,700	S$6,070
5	CapitaLand Integrated Commercial Trust	C38U	Retail / Office	6.67%	4.8%	S$66,700	S$3,202
6	CapitaLand Ascott Trust	HMN	Hospitality / Serviced Residences	6.67%	6.9%	S$66,700	S$4,602
7	Keppel DC REIT	AJBU	Data Centres	15.0%	4.5%	S$150,000	S$6,750
8	AIMS APAC REIT	O5RU	Industrial / Logistics	15.0%	6.9%	S$150,000	S$10,350
9	Lendlease Global Commercial REIT	JYEU	Retail / Office	15.0%	6.8%	S$150,000	S$10,200
10	NTT DC REIT	NTDU	Data Centres	15.0%	8.0%	S$150,000	S$12,000
Total				100%	6.68% (blended)	S$1,000,000	S$66,830

Result: S$66,830 in annual cash distributions on S$1,000,000 of capital — with zero leverage, zero loan to service, and zero personal income tax.

Under Singapore's one-tier corporate tax framework, distributions from SGX-listed REITs paid to individual investors are not subject to further personal income tax, and there is no dividend withholding tax on Singapore-sourced REIT distributions. The 6.68% you see in the table above is, what you get.

In fact, I have not included my trump card, United Hampshire US REIT in the calculation, a REIT gem which gives 8.5% yield on the back of essential tenant providers who have signed long lease terms with them.

Transaction costs to build this portfolio are trivial — brokerage and clearing fees on S$1,000,000 typically run under S$1,000 in total, a one-time cost of well under 0.1%.

The Property Side: Same Capital, 75% Leverage, Rented Out

Now the property scenario. With S$1,000,000 as a 25% equity stake, the maximum property price under 75% leverage is:

Property Price = S$1,000,000 ÷ 0.25 = S$4,000,000 Loan Amount (75% LTV) = S$3,000,000

At 75% leverage, S$4,000,000 of purchasing power pushes past typical mass-market OCR pricing and into the upper end of the OCR segment, or larger/multiple units — new-launch OCR condos transact broadly in the S$1,200–S$1,800 psf range, so this quantum buys a large landed-equivalent or premium-sized condo, or could be split across more than one OCR property. We'll keep it as a single S$4 million asset for clarity.

Gross rental yields for OCR private condos in 2026 sit around 3.0%–3.8%. We'll use 3.5% as a fair midpoint.ready absorbs and nets them off before declaring the distribution yield: Gross Annual Rent = S$4,000,000 × 3.5% = S$140,000 (≈ S$11,667/month)

Step 2: Strip Out Operating Costs

This is where the buy-to-rent thesis starts leaking. A rented-out private property in Singapore carries real, recurring costs that a REIT unitholder never sees because the REIT manager already absorbs and nets them off before declaring the distribution yield:

Expense	Basis	Annual Cost
Maintenance & sinking fund	Flat estimate	S$4,000
Property agent commission	1 month's rent/year	S$11,667
Insurance & incidental repairs	~2% of gross rent	S$2,800
Total Operating Expenses		S$18,467

Net Property Income (before financing and tax) = S$140,000 − S$18,467 = S$121,533

That's already a drop from a 3.5% gross yield to roughly a 3.04% net yield on property value — before the mortgage and taxes.

Step 3: Service the 75% Leverage

The loan of S$3,000,000 at 2% per annum interest costs:

Annual Mortgage Interest = S$3,000,000 × 2% = S$60,000

Taxable Rental Income = S$121,533 − S$60,000 = S$61,533

Step 4: Singapore Income Tax at 15% Net of Expenses

Income Tax = S$61,533 × 15% = S$9,230

Step 5: What's Actually Left

Net Cash Income = S$61,533 − S$9,230 = S$52,303

On the S$1,000,000 of cash equity the investor put in, that's a net cash yield of:

S$52,303 ÷ S$1,000,000 = 5.23% per annum

The above ignores the upfront cost of entry — and a larger property price means a steeper stamp duty bill in dollar terms, even though the percentage is similar. A second residential property purchase in Singapore attracts Buyer's Stamp Duty (BSD) of roughly S$179,600 on a S$4 million purchase, plus legal and valuation fees of around S$20,000 — about S$199,600 total, paid out of the same S$1,000,000 before a single dollar of rent is collected.

Run that forward over 10 years, holding both income streams flat for comparability: the REIT portfolio generates S$668,300 in cumulative cash distributions. The leveraged property generates S$523,000 in cumulative net rental cash flow — and that's before deducting the roughly S$199,600 paid out in stamp duty and legal fees just to get in the door. Net of that entry cost, the property nets closer to S$323,400 over a decade, versus the REIT portfolio's S$668,300 — a gap of roughly S$344,900 on the same starting capital.

Why the Gap Is This Wide

1. REITs are already leveraged at the entity level — you don't need to add personal debt on top. S-REITs typically run gearing of 25%–40% at the trust level, financing portfolio acquisitions with low-cost institutional debt, and what reaches you as a unitholder is the yield after that leverage has already been applied and the associated risk absorbed by a regulated, MAS-supervised structure. Layering a second, personal 75% mortgage on top of a single residential property doesn't replicate this — it just adds risk concentrated in one asset, one tenant, and one location, with a much thinner equity buffer than the trust-level gearing used inside a REIT.

2. REIT distributions are tax-exempt for individuals; rental income is not. Singapore's one-tier tax system means REIT distributions reach you net, in full. Rental income is assessable income, taxed after allowable deductions — and importantly, a private landlord cannot deduct principal repayment, only interest, while still having to fund principal out of after-tax cash flow if the loan amortizes (this example used interest-only financing to be generous to the property side; an amortizing loan would compress the net cash position further).

3. Stamp duty is a one-way, often six-figure tax on entry that REITs simply don't have. BSD and (where applicable) ABSD apply to the full purchase price of a leveraged property — meaning the tax is calculated on S$4,000,000, not on the S$1,000,000 of actual equity at risk. At higher leverage, the same equity buys a larger property and therefore a larger stamp duty bill in absolute dollar terms, even as the percentage stays roughly flat. There is no equivalent levy on buying REIT units on the SGX.

What This Comparison Doesn't Capture

• Capital appreciation is excluded from both scenarios' income figures. Singapore property has historically appreciated, and REIT unit prices also rise and fall with interest rates, sentiment, and asset values — neither is a "yield-only" asset in total-return terms.
• Vacancy risk isn't modelled for the property scenario (a vacant month with no tenant is a real, recurring risk for a single-tenant asset that a 200-property REIT portfolio largely diversifies away, and at 75% leverage a vacant month still requires the full S$5,000 monthly interest bill to be paid out of pocket).
• Amortizing vs interest-only loans: this example used interest-only financing, which is generous to the property scenario. Most residential mortgages in Singapore amortize, meaning actual monthly cash outflow is higher than the interest-only figure used here.
• Interest rate risk is amplified at higher leverage. A rise from 2% to, say, 4% on a S$3,000,000 loan adds S$60,000 a year in interest — more than wiping out the entire net cash income calculated above. The same rate move on the unlevered REIT portfolio has no direct effect on the investor's principal (though it can affect REIT unit prices and underlying borrowing costs at the trust level).
• REIT capital values can fall, sometimes sharply, when interest rates rise — DPU and unit price are not guaranteed, and concentrated single-country or single-sector REITs (China retail exposure via Sasseur, for instance) carry currency and regulatory risks of their own.
• Selling a property carries Seller's Stamp Duty if sold within the holding period, agent fees, and illiquidity that a REIT portfolio does not have.

The Takeaway

The Singapore property narrative persists because it conflates two separate things: property as a forced savings and leverage vehicle (which works, slowly, mostly through price appreciation over decades) and property as a yield-generating rental investment (which, on the math, lands around 5%–5.5% net cash yield even at aggressive 75% leverage, once financing cost and tax are stripped out — and that's before accounting for six-figure stamp duty at entry, and before the much larger downside if rates rise or the tenant leaves).

A diversified, unleveraged REIT portfolio sidesteps almost every friction point in that equation: no stamp duty, no personal mortgage, no income tax on the distribution, instant liquidity, and exposure spread across ten different property types, tenant bases, and geographies instead of concentrated in one unit with one tenant. The 6.68% net cash yield generated above isn't a forecast or a sales pitch.

For an investor whose goal is the highest sustainable cash income per dollar of capital deployed, the math in Singapore currently points one way and it is not properties.

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This article is for educational and illustrative purposes only and does not constitute financial, tax, or investment advice. REIT distribution yields move with unit prices and are not guaranteed; past distributions are not indicative of future payouts. Property rental yields, financing rates, and tax treatment vary by individual circumstance — consult a licensed financial adviser or tax professional before making investment decisions. Figures are approximate, based on publicly available data as of mid-2026, and are intended to illustrate a methodology rather than predict future returns.

Portfolio Update June 2026: Accumulating NTT DC, Daiwa Logistics REIT for Dividend Growth

I have made several purchases recently to strengthen my dividend income stream, along with one new position that is more of a vanity project than a pure investment.

Have sold my Frencken Position at $3.53-$3.54

NTT DC REIT – Major Accumulation

Data centre capacity remains in high demand globally. Among the listed data centre REITs available to me, I evaluated NTT DC REIT, Keppel DC REIT and Digital Core REIT.

My view is that Keppel DC REIT has the strongest portfolio, particularly given its significant exposure to Singapore, which is one of the tightest data center markets in the world. However, the market already recognizes this quality and has priced it accordingly, resulting in a rich valuation.

NTT DC REIT, in my opinion, offers the second-best portfolio mix while still trading at a comfortable dividend yield and a discount to book value. This provides a more attractive balance between quality, income and valuation. In particular, I like its exposure to Singapore as well as selected overseas markets where data centre demand remains robust.

As a result, I have made a substantial purchase of NTT DC REIT at a forward yield of approximately 7.8%. This position should materially enhance my dividend income beginning in 2027.

Daiwa House Logistics Trust

I have recently added to my income portfolio as part of a selective expansion into higher-yield industrial real estate with geographical diversification.

Daiwa House Logistics Trust is a Japan-focused logistics REIT with exposure to modern warehouse and distribution assets across key logistics hubs in Japan. Its properties are strategically positioned near major transport corridors and consumption hubs. Tenants typically include e-commerce distributors, and warehouse users such as Suntory and Mitsubishi Express, providing long lease structures and stable cash flow visibility.

Vanity Project – Japan Foods Holding

I have also continued accumulating shares in Japan Foods Holding, to the extent that I should now rank among the company's top 20 shareholders.

From a pure investment perspective, this is not my strongest idea. The company is currently loss-making and remains in the midst of a rationalization and turnaround process. However, I enjoy being a shareholder of a business whose products and outlets I regularly patronise, which is why I consider this a vanity project.

Should management successfully restore profitability, there is potential for dividends to resume from 2027 onwards. While the investment carries execution risk, I am prepared to be patient and see how the turnaround unfolds.

Dividend (Year to Date)

USD $13,060

HKD $9,068.61

SGD $9,068.20

Why I Am Investing in Two Singapore Listed REITs Delivering More Than 8% Dividend Yield

UI Boustead REIT and Daiwa House Logistics Trust offer distribution yields above 8%, meaningfully higher than most Singapore blue-chip REITs such as Keppel REIT and CapitaLand Ascendas REIT, as well as traditional fixed income instruments. This places them at a clear income premium while still being backed by real asset cash flows.

Beyond yield, both trusts are anchored in logistics and industrial properties supported by long-term structural drivers including e-commerce growth, advanced manufacturing, and global supply chain reconfiguration. These are demand themes that continue to underpin occupancy and rental resilience across cycles.

UI Boustead REIT has a diversified portfolio of industrial, business park, and logistics assets primarily located in Singapore (about 70%+), with the remainder in Japan. Its tenant base is anchored by multinational corporations across engineering, life sciences, aerospace, and technology sectors, including names such as Rolls-Royce, Jabil, GSK, and Razer. This creates relatively stable occupancy supported by mission-critical industrial usage.

Daiwa House Logistics Trust (DHLT) focuses on modern logistics facilities, with the majority of assets located in Japan and a smaller portion in Vietnam. Its properties are strategically positioned near major transport corridors and consumption hubs. Tenants typically include e-commerce distributors, and warehouse users such as Suntory and Mitsubishi Express, providing long lease structures and stable cash flow visibility.

Geographically, the two REITs complement each other well: UI Boustead provides exposure to Singapore’s high-spec industrial and business park office for HQs, while DHLT offers pure-play exposure to Japan’s logistics market, which benefits from Japan's e-commerce, food and beverage products and automation tailwinds.

Investment View

For income investors, the core attraction is the exceptionally high and sustainable cash yield. With both REITs offering 8%+ distributions, investors are effectively locking in a materially higher income stream compared to most blue-chip REITs, government bonds, and fixed deposits. Importantly, this yield is backed by real assets, long lease tenures, and institutional-grade tenants rather than speculative growth assumptions. Combined with moderate leverage levels and strong sponsor backing, the pair provides a compelling balance of income stability and geographic diversification in today’s higher-rate environment.