10 Australian REITs to Watch on the ASX [2023]

List of the top 10 Australian REITs on ASX

Data as of 18 April 2023. Source: ASX.

*The list of stocks mentioned is ranked by market capitalisation. When deciding what stocks to feature, we analyse the company's financials, recent news, advancement in their timeline, and whether or not they are actively traded on Stake.

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Discover the top A-REITS to watch

1. Goodman Group ($GMG)

Market capitalisation: $36.52b

Stock price (as of 18/04/2023): $19.42

Stake platform bought / sold (1 Jan 2023 - 18 Apr 2023): 40% / 60%

Goodman Group owns, develops and manages various types of industrial properties such as logistics and distribution centres, warehouses, business parks and data centres in major global cities. They usually offer an end-to-end service, from building designs to long-term management of all aspects of the property.

Their clients cover a range of industries, including logistics, automotive, e-retail and retail. They usually want large areas of land close to urban centres, with good links to transport, and easy access to workers and consumers, but these properties are often in short supply and rather costly. Like Charter Hall, Goodman has an investment management arm that partners with institutions and funds four property partnerships in Australia.

Learn more about Goodman Group in our Under the Spotlight on the company.

2. Scentre Group ($SCG)

Market capitalisation: $14.69b

Stock price (as of 18/04/2023): $2.83

Stake platform bought / sold (1 Jan 2023 - 18 Apr 2023): 41% / 59%

Scentre Group owns and operates 42 retail assets across Australia and New Zealand under the Westfield brand. It was formed in 2014 as a result of a restructuring of the Westfield Group. Westfield's U.S. and UK assets were then acquired by European multi-national commercial real estate firm Unibail-Rodamco ($URW) in a deal completed in 2018.

The shopping centres are typically anchored by major supermarkets and department stores, alongside other retailers, food and entertainment options. While Scentre Group can earn consistent rental income from these tenants, its business model needs to constantly adapt to consumer preferences. The growth of online shopping and higher inflation could mean fewer visitors and purchases over the longer term.

3. Stockland ($SGP)

Market capitalisation: $10.19b

Stock price (as of 18/04/2023): $4.26

Stake platform bought / sold (1 Jan 2023 - 18 Apr 2023): 48% / 52%

Stockland develops, owns, and manages residential, retail, and commercial properties across Australia. It’s a major player with a market cap of over $10b and covers several segments in its property portfolio. They have a range of residential real estate assets from apartments, townhouses and family homes.

Stockland's retail assets include shopping centres in suburban towns, usually anchored by supermarkets as major tenants. The firm also has a commercial property arm, with logistics centres and industrial warehouses. Stockland has a number of land lease communities aimed at retirees, where they own the land, but residents can buy the homes. Investors should note that the group has some office spaces, whose future could be less certain as other working arrangements persist.

🆚 Compare SGP vs CHC→

4. Mirvac Group ($MGR)

Market capitalisation: $9.02b

Stock price (as of 18/04/2023): $2.28

Stake platform bought / sold (1 Jan 2023 - 18 Apr 2023): 47% / 53%

The Mirvac Group operates across property development, investment and management areas. Currently, the office space segment has the highest values in their portfolio, but future plans are targeting mixed-use and residential developments near urban areas. Their growth strategy includes expanding the build to rent model in the Australian markets.

Mirvac emphasises sustainability and innovation in their designs, pointing towards factors such as the NABERS Energy rating when advertising its buildings. Their business has remained within Australia for the moment and they don't offer any exposure to international property at present.

5. Vicinity Centres ($VCX)

Market capitalisation: $8.95b

Stock price (as of 18/04/2023): $2.01

Stake platform bought / sold (1 Jan 2023 - 18 Apr 2023): 62% / 38%

Vicinity Centres is Australia's second largest manager of retail property with over $24b in assets under management. They own several shopping centres focused on premium brands like Melbourne's Emporium and the Queen Victoria Building in Sydney. The company has over 60 retail assets in total and more than 66% of Australians live within a 30-minute drive of one of these buildings.

Vicinity Centres owns office spaces located in proximity to its shopping centres, as the team is looking towards mixed-use developments for future growth. They are also exposed to residential real estate through apartment buildings near these urban hubs, as well as the short-stay sectors with hotels.

6. Dexus Property Group ($DXS)

Market capitalisation: $8.36b

Stock price (as of 18/04/2023): $7.78

Stake platform bought / sold (1 Jan 2023 - 18 Apr 2023): 56% / 44%

Dexus invests in a range of commercial property assets across Australia, including office buildings, industrial properties, and retail properties. They're focused on developing and refurbishing high quality assets in major cities, especially around the centres of Sydney, Melbourne and Brisbane. The team has entered the healthcare real estate segment to establish a more diversified portfolio.

Office space and industrial real estate are the largest drivers of portfolio value for Dexus. This means the firm's future will be affected by remote and hybrid working trends. They're also in the process of taking over AMP's real estate and domestic infrastructure platform. This would greatly expand Dexus' portfolio but involves taking on a considerable amount of debt to fund the acquisition.

7. Charter Hall Group ($CHC)

Market capitalisation: $5.49b

Stock price (as of 18/04/2023): $11.60

Stake platform bought / sold (1 Jan 2023 - 18 Apr 2023): 69% / 31%

Charter Hall Group specialises in managing and investing in property on behalf of institutional and retail investors. They are responsible for a number of investment funds with assets across office, retail and industrial sectors on several continents. They have funds under management of around $88b, which cover both unlisted and listed property trusts.

To include the unlisted segments, the Charter Hall Group stock is a stapled security made up of a Charter Hall Property Trust unit and a Charter Hall Limited share. The group actually has several listed REITs with more targeted exposure. One is focused on supermarkets ($CQR), the second is investing in properties with long-term leases to corporate and government tenants ($CLW) and another is for social infrastructure properties ($CQE).

8. Lendlease Group ($LLC)

Market capitalisation: $5.43b

Stock price (as of 18/04/2023): $7.88

Stake platform bought / sold (1 Jan 2023 - 18 Apr 2023): 39% / 61%

The Lendlease Group is a multinational construction, property and infrastructure business. They provide exposure to local and international property through mixed-use residential, commercial, and retail developments in urban centres across Australia, Asia, Europe, and the Americas. They’re targeting projects in cities they consider to be the most resilient and best-performing options based on several criteria. 

Lendlease has faced headwinds in recent times, as the business has slowed due to rising interest rates, lower demand and insolvencies in the construction industry. The company’s working on a transformation strategy to streamline costs, establish more reliable income streams and increase funds under management. There is a tough journey ahead, but investors could be rewarded if all goes to plan.

9. Abacus Property Group ($ABP)

Market capitalisation: $2.37b

Stock price (as of 18/04/2023): $2.65

Stake platform bought / sold (1 Jan 2023 - 18 Apr 2023): 64% / 36%

Abacus Property's real estate portfolio is predominantly located across major metropolitan markets on Australia’s east coast and throughout New Zealand. Their assets are split between self-storage businesses known as Storage King and commercial segments that include various office space and retail assets.

Abacus has announced plans to spin out the Storage King platform into its own REIT, depending on shareholder approval in the near future. This unit experienced 25% growth in rental incomes in H1 2023, amounting to $72.2m in total. On the other side, net property rental income grew only 6% to $50.8 million and has been negatively impacted by rising interest rates.

10. Centuria Capital Group ($CNI)

Market capitalisation: $1.35b

Stock price (as of 18/04/2023): $1.69

Stake platform bought / sold (1 Jan 2023 - 18 Apr 2023): 48% / 52%

Centuria Capital Group has built a business centred around property funds management and investment bonds. They have a range of listed and unlisted property funds focused on office, industrial and retail buildings. Aside from the more traditional segments, they've recently expanded into healthcare real estate and agricultural assets.

The team's expecting these new areas to drive growth and diversification to help them weather market volatility. Centuria's stock has endured a significant fall in value since 2021, as its earnings declined alongside lower demand for office space and acquisitions. This may be a good entry point for investors who think a recovery is possible.

What are the best-performing REITs in Australia?

Some of the top REITs by five-year total returns to the end of March 2023 were Goodman Group ($GMG) at 19.64%, Aspen Group ($APZ) at 19.45% and Charter Hall Group ($CHC) at 18.42% (data from ASX Investment Products - March 2023).

Summary:

• Retail investors can gain exposure to various parts of the property market like healthcare or industrial real estate through REITs, rather than just residential real estate.
• REITs can be part of a diversified portfolio and offer a way of investing in property without needing to take on long-term loans in an environment with rising interest rates.
• Like all real estate assets, these A-REITs do still come with risks. Investors should learn how REITs work before adding them to their portfolio.

Australian REITs FAQs

How many Australian REITs are listed on the ASX?

There were 42 Australian REITs and four international property REITs listed on the ASX as of 18 April 2023. The S&P ASX200 A REIT index tracks the overall performance of these Australian real estate investment trusts (A-REITs) and mortgage REITs. For more general exposure to the sector, there are multiple Australian property ETF options available to investors.

The SPDR S&P/ASX 200 Listed Property Fund ($SLF) seeks to closely track this index for a managed expense ratio (MER) of 0.40%. The VanEck Australian Property ETF ($MVA) invests in at least ten of the largest REITs on offer with a MER of 0.35%. The Vanguard Australian Property Securities Index ETF ($VAP) follows a wider range of REITS, looking at the ASX 300 universe.

What are some popular U.S. listed real estate investment trusts?

REITs are popular investments in the U.S. due to their regular dividend payments. Some major players include Prologis, Inc ($PLD) for industrial properties, American Tower Corporation ($AMT) with large numbers of communication sites and Equinix, Inc. ($EQIX) focuses on data centres. Check out more U.S. REITs that pay recurring dividends.

Some of the popular global REIT ETFs available to Australian investors include Vanguard Global ex-U.S. Real Estate ETF ($VNQI) and iShares Global REIT ETF ($REET).

This does not constitute financial product advice nor a recommendation to invest in the securities listed. Past performance is not a reliable indicator of future performance. As always, do your own research and consider seeking appropriate financial or taxation advice before investing.