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Hi there fellow REITs investors! After years of poor sentiment in the REIT market, many investors have played it safe — sticking with the big names like CICT, MIT, and Parkway Life. And to be fair, there’s nothing wrong with that. When times are uncertain, you go with what’s familiar.

But something interesting has happened recently.

As markets from Singapore to the US hit record highs, and investor confidence slowly returns… even REITs have started to rally. And within this quiet rally, a few smaller, often ignored REITs have suddenly woken up — jumping 20%, 30%, even 40% in just a few months.

These aren’t your usual blue-chip suspects. These are the underdogs — and each one has its own story.

Today, I’ll walk you through 5 REITs that have broken out in this uncertain market, what triggered the surge for each of them, and whether I think the rally is built on real fundamentals… or just temporary excitement.

Before we dive in, let me remind you that this post is for informational purposes only and not financial advice. Always do your own research and consult a licensed financial adviser before making any investment decisions. I own some of the REITs discussed, but what works for me might not work for you.

Alright, let’s dive in.

CapitaLand China Trust – From Laggard to Late Bloomer?

Let’s start with CapitaLand China Trust, or CLCT — Singapore’s largest China-focused REIT.

It started off as a pure-play retail REIT but has since expanded into logistics and business parks across China. Today, its portfolio includes shopping malls in tier-1 and tier-2 cities, plus a mix of “new economy” assets aimed at capturing growth in e-commerce and business services.

But let’s be honest — CLCT hasn’t performed well in recent years.

In fact, its unit price had dropped below Covid levels, dragged down by weakness in its logistics and business park properties, which have seen high vacancy rates and weak rental reversions. On top of that, there’s been a general investor aversion to China assets, given concerns about the property sector, regulatory risks, and geopolitical overhang.

Even when sentiment toward Chinese equities started to recover earlier this year, CLCT didn’t move much. It remained overlooked… until now.

In the last 3 months, the REIT has climbed 19.4%, and the reason revolves around the newer domestic China REITs (or C-REITs). If you want to know more about C-REITs, take a look at my previous post with the link pasted here. But let me elaborate on the break out. 

First, CLCT is trading at just 0.7x Price-to-NAV, with a forward yield of 7.5% — far higher than the newer domestic C-REITs, many of which trade at yields below 4%. That kind of valuation gap is hard to ignore. It showcases the true market value of their assets and draws attention to how undervalued CLCT could be.

Second, they’ve taken steps to unlock value. The planned divestment of CapitaMall Yuhuating into a new domestic C-REIT, called CLCR, allows the recycling of capital from CLCT which is trading at below NAV to a C-REIT that are mostly trading above NAV If successful, this could narrow the discount that CLCT trades at. There’s growing interest from local Chinese investors in C-REITs — with recent IPOs seeing massive oversubscription. That rising local appetite could indirectly benefit CLCT, especially as it maintains a CapitaLand branding and reputation in China.

My quick take on this? I’m glad to see CLCT finally catching up. The retail malls are still solid, but the logistics and business park segment continues to be a drag — and that won’t turn around overnight. Still, with sentiment improving and the valuation gap starting to close, this could be an interesting turnaround play. I wouldn’t expect explosive growth, but the re-rating might not be over yet.

IREIT Global – Quietly Reinventing Itself in Europe

Next up is IREIT Global. It a Singapore-listed REIT with a portfolio of European commercial properties, mainly in Germany and Spain. Its assets include office campuses and business parks leased to blue-chip tenants — but it’s also one of the more under-the-radar REITs on the SGX.

For a while, IREIT struggled with high vacancies and muted rental growth, especially in some of its German properties. The market didn’t pay much attention to it — and the price drifted lower, trading at a steep discount to NAV.

But recently, things have started to change. Over the past few months, IREIT’s unit price has surged nearly 20.8%, as investors begin to take notice of its Berlin redevelopment project, a series of new leases, and broader signs of recovery in the European office market.

It placed $85 million in green notes to kickstart the redevelopment of its Berlin Campus into a mixed-use property — with hospitality, retail, and premium office space. Notably, some hospitality leases are signed on 20-year terms at nearly double previous rent levels.

Elsewhere, it has been quietly filling up vacancies — like bringing Spain portfolio occupancy from 77% to 83%, and achieving full occupancy at Parc Cugat Green for the first time since acquisition.

My Quick Take: Of all the REITs on this list, IREIT’s breakout feels somewhat more promising from a longer-term value unlock perspective. But it’s not a fast turnaround. DPU will take a short-term hit from redevelopment capex. This is a recovery that requires patience — and some faith that European office demand will bounce back. If it does, this could be one of the more rewarding ones over time.

ESR REIT – Finally Showing Signs of Life?

Let’s move on to ESR REIT.

It’s a diversified industrial REIT with a portfolio of logistics, warehouse, and business park assets — mainly in Singapore, but also in Australia and Japan. Despite this stable mix, ESR has really struggled over the past few years. The unit price had been stuck in a downtrend, weighed down by concerns over gearing, asset quality, and lacklustre DPU.

In fact, I personally bought a small position at around $0.40, and it’s been underwater ever since.

In the last 3 months, ESR has rallied more than 22%. So what’s changed?

First, they completed a 10-to-1 share consolidation in May 2025, which helped reduce volatility and made the stock more appealing to institutional investors. But the bigger shift is in their strategic direction.

Management is now focusing on divesting non-core assets — with plans to sell up to $400 million worth over the next two years. Some of that cash will go towards debt repayment, while some may be used for share buybacks and asset enhancements. They’re being more selective — acquisitions are off the table for now.

On the operational front, rental reversions are still positive at 5–7%, and occupancy remains stable above 90%. Plus, interest costs are expected to fall slightly in FY2025 as they refinance some loans amidst falling local interest rates.

My quick take on this? Well, I think this rally feels more justified than in the past. The REIT has been doing the hard work — slimming down, cleaning up, and focusing on value over the past couple of years. But here’s the caution: the price has run up quite a bit, and we’ve yet to see actual DPU growth. For now, I’m holding onto my position and watching how the next few quarters play out. It’s a good story — but still in the early chapters.

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Prime US REIT – A Big Bet on US Interest Rates?

Prime US REIT owns a portfolio of Grade A office buildings in the United States, spread across major cities like Atlanta, Denver, and Washington D.C. These are large, modern assets, typically leased to multinational tenants — but in recent years, that hasn’t helped much.

Ever since the pandemic, US office REITs have been one of the hardest-hit segments globally. Work-from-home trends, rising vacancies, falling valuations, and high financing costs have all taken a toll. Prime’s unit price collapsed by over 80% from its highs, and many investors had written it off completely.

But in the past 3 months, Prime has staged a sharp rebound — up more than 40%, joining the ranks of the top-performing REITs. So, what’s driving the turnaround?

The REIT announced a new 120,000 sq ft anchor tenant lease at its revamped Waterfront at Washingtonian property. With this and other leases, occupancy at the building has jumped from 33% to over 85%. That’s no small feat.

But make no mistake — this rally is not just about leasing. It’s speculative positioning on rate cuts. Prime and its US Office peers like Keppel Pacific Oak and Manulife US REIT have been deeply discounted for a long time. Any sign that funding costs may ease? Boom — the rebound comes fast and hard.

Now, my quick take on this is that this one’s speculative. The leasing wins are good, but broader US office dynamics remain tough. The rally is largely rate-driven. If the Fed disappoints, this could retrace quickly. 

Acrophyte Hospitality Trust – The Wild Card

And this is the top performer over the past 3 months. Acrophyte Hospitality Trust — previously known as A.R.A. US Hospitality Trust — owns a portfolio of 33 select-service hotels across the United States, with over 4,000 rooms in total. These are mostly mid-scale hotels under well-known brands like Hyatt and Marriott, targeting business and leisure travelers alike.

But the REIT has had a tough time since its listing. Performance was hit hard during the pandemic, and even in the recovery phase, DPU remained underwhelming. With high capex needs, low margins in some properties, and limited scale, investors lost confidence — and its unit price fell to around 30% of book value.

Yet in the past 2 months, Acrophyte has become one of the best-performing REITs, rallying 43%. It’s gone from being completely forgotten… to suddenly grabbing headlines.

So what’s driving it?

Well, first — it’s selling off a loss-making hotel that was dragging down margins. Good move.

But the real spark came when the REIT announced it’s “evaluating strategic options”, including discussions with the sponsor — which controls the manager and many related entities.

To me, this smells like potential privatisation. We’ve seen similar playbooks before — a strategic review, underperforming small-cap REIT, tight float, and suddenly… a buyout offer appears. That’s speculation, of course. But it’s enough to get investors excited.

My quick take. Let me be honest — this is the most speculative breakout of the five. If the sponsor makes a privatisation move, there’s upside. But if they go the other way — the strategic review also includes options like cutting dividends or take on more sale — this price run may fizzle. It’s a high-risk play that I wouldn’t put core capital into, but I can see why some investors are taking the punt.

The Dividend Uncle’s Take

So… after reviewing all five breakouts, what’s the big picture here?

Let me group them into three buckets.

1) Fundamentals-Driven Recovery: ESR REIT & IREIT Global

These two breakouts are backed by actual change. ESR is finally slimming down and restructuring its portfolio. IREIT is transforming a major German asset and seeing leasing traction in Spain.

But both still need time. The price has run, but DPU improvement will take a few quarters to show up. If you have the patience and want to bet on a long-term turnaround, these are worth watching.

2) Sentiment-Driven Upside: CLCT

CLCT sits in the middle — improving sentiment, solid mall assets, and an attractive valuation.

The logistics and business parks are still a drag, but if China risk appetite continues improving, CLCT might finally get the re-rating it deserves. Personally, I think this one could have more legs, even though the rally has already started.

3) Speculative Breakouts: Prime US REIT & Acrophyte Hospitality Trust

These are the high-risk, high-volatility plays. Prime’s jump is almost entirely due to hopes of US rate cuts. Acrophyte? It’s trading more on privatisation whispers than operations. If they slash distributions or the sponsor delays any moves, the price could easily reverse.

I’m not adding to either at this point — I prefer to see more clarity.

How Am I Positioning Personally?

Out of the five, I already hold a relatively big position in CLCT and small positions in ESR REIT and IREIT — and I’m watching how their triggers plays out. I won’t rush in just yet — the turnaround could be real, but results not that fast.

As for Prime and Acrophyte? I’ll leave those for the braver souls out there for now.

Alright folks, that’s all for today. Let me know in the comments — which of these REITs do you think has the best chance of sustaining its gains? Do you already hold these REITs and have been feeling on cloud nine recently with the break out?

Until next time, keep learning, stay patient, and as always — happy investing!