Interest rate cuts, end of remote work could make office S-Reits the dark horse of 2025

SINGAPORE-LISTED office real estate investment trusts (S-Reits) have the potential to be the “dark horses” on the local bourse next year as they are more sensitive to interest rate cuts compared to other sub-sectors, analysts say.

Positive business sentiment, easing debt and a continuing trend towards work-from-office could buoy office S-Reits, whose valuations have lagged their counterparts on the bourse.

Office S-Reits are trading at about 50 per cent discount to their book values on average, compared to the overall S-Reit sector which is trading at about 20 per cent discount.