Sabana REIT’s Record Quarter: 5 Surprising Insights from a Management Team on its Way Out

Introduction: Beyond the Numbers

Financial reports can be dense, but Sabana Industrial REIT’s latest Q3 2025 results contain a story of remarkable performance worth exploring. But what makes this performance truly extraordinary is the context: these results were achieved amidst a unitholder-directed removal of the very management team that delivered them. This article distills the five most impactful and surprising takeaways from their recent announcements, revealing a story of strategic success against a backdrop of unprecedented change.

Takeaway 1: The “Crown Jewel” Property is Outperforming the Entire Market

The REIT’s “crown jewel,” New Tech Park, was the key driver of the strong quarterly performance. This isn’t just a number; it’s the result of successfully onboarding major new tenants such as DKSH Singapore, Lapp Asia Pacific, and a major South-Korean multinational company, demonstrating the property’s powerful appeal to expansionary firms.

• Its occupancy rate surged to a 12-year high of 94.7%.
• This figure is significantly higher than Singapore’s average business park occupancy of 76.7%.
• The property’s valuation has improved to a record high of $364.2 million as of 30 June 2025.

For unitholders, the outperformance of this single asset is a powerful demonstration of embedded value and successful asset-level strategy.

Takeaway 2: A Nearly 5-Year Streak of Raising Rents

Sabana Industrial REIT has achieved positive rental reversion for the 19th consecutive quarter, a record milestone that underscores the team’s consistent execution. For Q3 2025, the rental reversion was a strong 11.3%. This long-term streak, which started in Q1 2021, demonstrates consistent and effective asset management and strong tenant relationships, which are crucial for long-term value creation.

Takeaway 3: It’s Not Just Good, It’s the Best-Performing S-REIT

In a competitive field, Sabana Industrial REIT was the best-performing Singapore REIT (S-REIT) for the first nine months of 2025, delivering a total return of 34.2%. This year’s 34.2% return is the pinnacle of a multi-year outperformance story; since 2018, the REIT has delivered a staggering 96.7% total return, vastly outpacing the broader S-REIT market index. This top-tier performance was organically driven by extracting value from the existing portfolio, not through acquisitions.

Takeaway 4: A Clear Vision for a Greener Future

The REIT is positioning itself as a leader in sustainability, with a stated goal to become “one of the first carbon neutral industrial S-REITs by 2040.” This commitment is backed by tangible results. As of August 31, 2025, the REIT generated 6,489 Megawatt hours of solar energy, representing 8.1% of the total electricity consumption across all its properties. This commitment is not just about environmental stewardship; it’s a shrewd business strategy. As the press release notes, the use of solar energy is already “contributing towards stabilising operational costs amid escalating costs and volatile energy prices,” directly impacting the bottom line.

Takeaway 5: The Surprising Twist: Stellar Results Amidst Unprecedented Change

The most counter-intuitive takeaway is that this record performance is happening while the REIT is undergoing an “Internalisation Process.” This process, directed by unitholders at an Extraordinary General Meeting, involves the removal of the current manager. The sentiment of the outgoing management team was captured in a joint message from its Chairman and CEO:

“As the outgoing Manager, we are deeply encouraged by how our team has built the best foundation for sustained growth. Despite the odds, we have achieved stellar performance for the first nine months of this year… We are deeply grateful to our staff for their dedication and commitment. They have persevered and soldiered on in giving their best, united in vision to deliver on our mission”

This context makes the stellar 38.4% year-over-year growth in income available for distribution per unit for Q3 2025 even more remarkable, highlighting the team’s focus and execution during a period of significant corporate change.

Conclusion: A Strong Foundation for a New Chapter

In a testament to their professionalism, the outgoing management delivered these record-setting results while navigating their own ouster, setting new benchmarks across financial, operational, and sustainability metrics. They have built a robust foundation and demonstrated a clear strategy for value creation. With such a strong foundation and clear momentum, the critical question for investors is how the new internalised management will build upon this legacy.

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