1. Company Overview:

Centurion Accommodation REIT (SGX: 8C8U), or CAREIT, made its debut on the Mainboard of the Singapore Exchange in September 2025 as the first Global Living Sector REIT. 

CAREIT focuses on real estate assets primarily used for purpose-built worker accommodation (PBWA) under the ‘Westlite’ brand, and purpose-built student accommodation (PBSA) under the ‘Dwell’ and premium ‘EPIISOD’ brands. The REIT’s assets span across 3 countries: Singapore, the United Kingdom, and Australia.

As of 31 December 2025, CAREIT’s portfolio includes 5 PBWA assets in Singapore, 8 PBSA assets in the United Kingdom, and 1 PBSA asset in Australia. The total number of operational beds across these 14 assets is 25,154, with a combined portfolio value of S$1.88 billion. 

In January 2026, CAREIT expanded its holdings by acquiring the 732-bed EPIISOD Macquarie Park, a PBSA asset in Australia, bringing its total assets under management to approximately S$2.18 billion.

2. Financial Performance & Key Portfolio Metrics for FY2025:

  • Revenue & Net Property Income: CAREIT’s revenue from 12 August (date of constitution) to 31 December 2025 exceeded expectations by 3.4%, reaching S$50.7 million, while net property income in the same period was 4.1% higher than forecast at S$36.1 million. This was driven by higher-than-expected rental rates and occupancy in both PBWA and PBSA segments.
  • Distribution to Unitholders: The distribution amount to be paid to unitholders for the period between 25 September and 31 December 2025 was S$30.0 million, exceeding the forecast by 6.7%. The distribution per unit for the same time period stood at 1.739 cents, also surpassed expectations by 6.7%. This was attributed to increased net property income and lower finance costs due to reduced loan drawdowns and lower benchmark rates.
  • Occupancy: CAREIT achieved an occupancy rate of 97.6% for its PBWA assets, while the PBSA assets maintained a strong occupancy rate of 99.1%.
  • Debt Profile: The REIT’s aggregate leverage was 22.1%, with an interest coverage ratio of 6.6x. The weighted average financing cost was 3.46%, and 55.8% of borrowings were at fixed rates. Importantly, CAREIT has no refinancing requirements until FY2028.

3. Geographical Income & Portfolio Valuation Breakdown:

  • Net Property Income: Singapore contributed 77.06%, the United Kingdom 20.13%, and Australia 2.81% to CAREIT’s net property income.
  • Portfolio Valuation: Singapore accounts for 74.20% of the portfolio value, the United Kingdom contributes 22.90%, and Australia makes up 2.90%.

4. Lease Terms for PBWA & PBDA Assets:

  • PBWA: Leases are typically on an annual basis, leading to a shorter weighted average lease expiry (WALE). As of 31 December 2025, the WALE for the PBWA portfolio stood at 0.6 years, with some leases already renewed.
  • PBSA: Leases are generally aligned with academic years. In the United Kingdom, student tenancies range from 44 to 51 weeks per year, and in Australia, tenancies are offered for 26- or 52-week periods. It is common for the WALE for PBSA assets to be under 1 year.

5. Top 10 Tenants by Gross Rental Income:

The top 10 tenants, primarily from the PBWA segment, contributed 7.26% of CAREIT’s gross rental income as of FY2025. 

Apart from CTR Holdings (a construction engineering company), which contributes 1.04%, the remaining tenants contribute less than 1% each.

6. Future Outlook:

  • Singapore: Ongoing infrastructure developments and regulatory changes are expected to continue driving demand for high-quality worker accommodation.
  • United Kingdom & Australia: Strong student demand, combined with a limited supply of PBSA, supports the favourable long-term growth prospects in these regions.

Closing Thoughts:

CAREIT stands out from other REITs and business trusts listed on the Singapore Exchange by focusing on a different asset class – specifically, PBWA and PBSA properties.

What I particularly appreciate about CAREIT is the strong portfolio occupancy across both its PBWA and PBSA assets, which exceed 95%. Its debt profile is equally impressive, with an aggregate leverage of just 22.1%, placing it among the lowest, if not the lowest, aggregate leverage levels compared to other REITs and business trusts on the Singapore Exchange.

Additionally, for investors who prefer exposure to Singapore-based assets, whether due to home bias or a desire to avoid foreign exchange risks, CAREIT is a solid option, with 77% of its net property income coming from its 5 local PBWA assets.

Disclaimer: At the time of writing, I do not own any units of Centurion Accommodation REIT.

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