We believe that declining bond yields are the main factor driving renewed interest in REITs. Looking back, most of our REIT picks has been on a steady rise since the start of 2025 with RCR seeing the quickest price appreciation. Aside from RCR, we have also recently rerated FILRT from HOLD to BUY following the infusion of a sizeable portion of its sponsor\u2019s retail unit, and underpinned by a blended forward 12-month div yield of 7.55% – the highest in the industry. <\/p>\n\n\n\n
Another must-have on a dividend portfolio is AREIT, the most stable in terms of price and offers consistently steady 6.40% average div yield in the past quarters. AREIT also has big potential for capital appreciation due to its sponsor\u2019s long runway of assets for future infusions.<\/p>\n\n\n\n
AREIT, Inc. (AREIT) \u2013 Buy, Target Price of P46.20<\/strong><\/p>\n\n\n\n Filinvest REIT Corp. (FILRT) \u2013 Buy, Target Price of P3.70<\/strong><\/p>\n\n\n\n Yields for this week\u2019s short-dated government securities eased across all tenors as investors scrambled to lock in returns ahead of expected policy rate cuts, which allowed the BTr to raise more than its initial offer. Rates for the three tenors averaged 5.468%, 5.551% and 5.694%, respectively, all lower than the previous auction. Furthermore, the 91-days and 182-days treasury bills (T-bill) have been seeing a stronger investor demand since the start of May which could be signaling a possible rate cut on June 19.<\/p>\n\n\n\n The BSP recently provided guidance for potentially 2 more rate cuts this year, assuming that inflation remains benign. If realized, this would bring target RRP to 5.00% from the current 5.50%. With T-bill rates being the shortest form of gov\u2019t tenor, it is likely to succumb faster to lower returns as well. <\/p>\n\n\n\n As such, we believe that REITs will be much more attractive to investors who are looking for higher returns on a relatively safe investment. We also note that stronger investor demand for REITs could drive it to higher prices would result to lower dividend yields moving forward, so it would be best to lock in those yields sooner rather than later.<\/p>\n\n\n\nTreasury bill rates ease ahead of rate cuts<\/h3>\n\n\n\n
Two more to go<\/h3>\n\n\n\n