Samsung J-REITs Yield Tops Global REITs Funds

[Asia Economy Reporter Junho Hwang] Samsung Asset Management announced on the 3rd that the J-REITs real estate fund has recently recorded the highest returns among global REITs funds. The fund's recent 1-year return and year-to-date return are 30.13% and 16.52%, respectively.

This fund invests in the Japanese real estate market. It diversifies investments across various properties such as offices, commercial facilities, residential housing, and hotels, aiming for a stable annual dividend yield of approximately 3.8%.

Established in September 2005, this fund has a long-term track record and has achieved a high performance of 95.92% since inception. In particular, it has achieved an excess return of about 43 percentage points compared to the benchmark index performance. The 3-month return (13.64%) and 6-month return (25.08%) have also consistently recorded positive results.

As of the end of March this year, this fund invests in high-quality stocks among 61 J-REITs listed on the Japanese stock market with a market capitalization of 16.4 trillion yen (approximately 170 trillion KRW). Its strength lies in high dividend income. Along with profits from the rise in Japanese real estate asset prices, it is expected to provide continuous and stable dividend income of about 3.8% annually (estimate as of the end of February 2021).

Park Yongsik, manager of the Alternative Asset Management Team, explained, "To overcome the performance deterioration caused by the COVID-19 crisis, each J-REIT company is making efforts to improve their structure from multiple angles. Internally, they are focusing on 'core asset concentration' by replacing held properties with high-quality assets, and externally, they are striving to meet domestic and international investors' investment standards by actively pursuing mergers and acquisitions to 'expand asset size.' To resolve the temporary shortage of dividend resources caused by rent adjustments, they are actively utilizing retained earnings and implementing shareholder-friendly policies. Therefore, the future outlook for J-REIT companies is also bright."

This content was produced with the assistance of AI translation services.