Singapore’s UOB Asset Management launches initial ETF in far more than 10 many years

Singapore’s UOB Asset Management has stated its initially exchange traded fund in in excess of a 10 years with the launch of a green-themed true estate investment have confidence in product or service.

The UOB Apac Inexperienced Reit ETF claims to be the very first in the planet to supply buyers with accessibility to sustainable residence investments in the Asia-Pacific location.

The manager’s former ETF listing was in 2009, when it released the United SSE 50 China ETF in Singapore.

The new fund seeks to replicate the general performance of the iEdge-UOB Apac Yield Concentrate Inexperienced Reit Index, established jointly by UOBAM and the Singapore Trade earlier this calendar year to monitor 50 Reits listed in Australia, Hong Kong, Japan and Singapore. It focuses on Reits that have significant-dividend yields and potent ESG performance in spots these as strength and drinking water usage, greenhouse gas emissions and green making certifications.

Faizal Gaffoor, Singapore-based team main internet marketing officer at UOBAM, said investor urge for food had been “very strong” so far, as Singapore investors seemed to Reits to health supplement their passive money.

The ETF captivated in excessive of S$80m ($58.5m) through the original offering interval.

There are five Reit ETFs on the Singapore Exchange. The NikkoAM-StraitsTrading Asia ex-Japan Reit ETF is the major, at $244.5m in property as of the finish of October, according to knowledge furnished by Morningstar. The Lion-Phillip S-Reit ETF has belongings of $174.1m, when the Phillip SGX Apac Dividend Leaders Reit ETF has property of $14.2m.

CSOP Asset Management’s CSOP iEdge S-Reit Leaders Index ETF launched earlier in November.

UOBAM is hoping to capitalise on growing consideration of ESG factors in the property place, as perfectly as increasing investor appetite for sustainability and the overall progress of ETF investing in normal.

Need for business office house across the location is predicted to grow 65 for each cent in the next decade to 1.35bn sq. toes, and UOBAM believes environmentally friendly business office style and design will be a top thought for tenants.

In addition to that, a lot of much larger institutional traders have sure mandates exactly where they have to have to commit primarily based on ESG components, stated Gaffoor.

“These are the investors that are demonstrating a great deal a lot more curiosity in these varieties of solutions,” he mentioned. “Having a eco-friendly tilt allows us to differentiate and market place his item far more efficiently.”

UOBAM claims that compared to the non-green Apac Reit Index, there is a 4 per cent advancement in greenhouse gas emissions, a 3 for every cent enhancement in electrical power use, a 7 per cent enhancement in h2o intake, an 18 for each cent advancement in design, building and renovation-concentrated green making certification, and a 11 for every cent improvement in valid operational inexperienced setting up certification.

The Singapore government’s emphasis on building out the metropolis-state as a sustainability hub, as effectively as on funding inexperienced public infrastructure, is also a essential element.

These endeavours to motivate sustainable investing and boost ESG at the governing administration degree send out a signal to institutional traders on what Singapore’s regulatory priorities are going forward, explained Gaffoor.

“Given the fact that [the Monetary Authority of Singapore] and [Singapore Exchange] are carrying out what is needed to teach traders in terms of their eco-friendly designs, it bodes effectively for these traders to also comply with suit hunting for investments this sort of as this,” he explained.

ETF property in Singapore-mentioned ETFs grew 57 for every cent to S$8.6bn in 2020, and had achieved S$11.5bn at the end of Oct, in accordance to the Singapore Exchange.

*Ignites Asia is a news service printed by FT Specialist for industry experts working in the asset administration sector. It covers every little thing from new products launches to polices and marketplace tendencies. Trials and subscriptions are accessible at ignitesasia.com.