Thailand's REITs offer safe haven in a volatile market

In the turbulent financial landscape of 2025, discerning investors are seeking refuge from the storm, finding a harbour in the dependable structure of Real Estate Investment Trusts (REITs). In Thailand, these instruments have emerged as the cornerstone of defensive investing, providing a crucial shield against the widespread market volatility that has defined the year. As investors pivot away from speculative, growth-orientated equities, the appeal of REITs has become evident. Their attractive and reliable dividend yields, averaging at 9% in June 2025, are underpinned by tangible assets and long-term rental agreements. This provides a predictability that has all but vanished from the broader stock market. Consequently, they can act as an anchor, protecting capital more effectively compared with the volatile swings of the stock market.

Industrial REITs show robust performance, led by examples like WHAIR, which offers a high 10.2% dividend yield backed by a 70.24% year-on-year increase in net income. In parallel, retail and hospitality REITs are proving resilient, with CPNREIT seeing strong growth in its office (+9.3%) and hotel (+3.8%) segments, offsetting limited mall growth. Unique venue-based REITs such as IMPACT Growth REIT are also thriving as Thailand becomes a key destination for major concerts and tours. This particular REIT is experiencing a significant recovery in 2025, with positive trends in rental rates and occupancy translating into impressive financial results. Its revenue is projected to reach a new high of THB 2.15 billion, and EBITDA is tracking toward THB 1.23 billion, underscoring the dynamic recovery across specialised real estate sectors.

For those pursuing stable core investments, Thailand REITs continue to outperform the SET index dividend yields of 4.39%, while SET50 and SET100 offer 4.12% and 4.24% respectively. These markets continue to struggle against sluggish GDP growth and ongoing political uncertainty affecting corporate earnings and investor confidence, despite modest improvement since January. While government bonds have rallied amid this flight to safety, their yields can't compete with REITs' income potential. REITs thus occupy an attractive middle ground, combining equity-like income with fixed-income stability.

Figure 1: Dividend Yields (2025 YTD)

Source: SetSmart, JLL Research 3Q25

The sector's outlook remains positive. Interest rate cuts expected in the second half of the year will benefit REITs by reducing financing costs and potentially increasing distributable income. As returns on savings and bonds decline, REITs' high dividend yields will become even more attractive, drawing additional investment. However, considering broader economic influences, investors should look beyond stability alone and consider diversifying across various asset classes. In the current economic climate, investor capital is more likely to gravitate toward stabilised, income-generating properties over speculative development projects. Establishing a stronger and flexible foundation for Thailand's REITs will enable the real estate sector to withstand persistent global and local economic pressures.