The ETF is benchmarked to the recently launched iEdge-UOB APAC Yield Focus Green Reit Index, which comprises 50 high-yielding Reits across Asia Pacific that meet environmental factor assessments by the global ESG benchmark for real assets, GRESB, according to Singapore Exchange (SGX).
Underpinned by Singapore’s position as an international Reit hub with more than S$110bn ($8.5bn) in market capitalisation, the index was developed and launched by SGX in partnership with UOBAM last month.
“The UOB green ETF gives investors an opportunity to participate in the development of sustainable real estate taking place across Asia Pacific so they can invest for profit and purpose,” Thio Boon Kiat, chief executive Officer at UOBAM, said in a statement.
The ETF enables individuals to invest in green Reits across the region and earn an annual dividend yield of up to 4%. The ETF attracted more than S$80m in assets during the initial offering period, which closed on 18 November 2021, according to UOBAM.
The projected demand for office space across Apec is expected to grow 65% from the occupancy rate in 2020 to 1.35bn square feet by 2030 because of a growing workforce, said UOBAM, citing a Cushman & Wakefield report.
More occupiers are indicating that green office design is a top three consideration, with seven in 10 willing to pay a higher rental for green-certified spaces, according to a JLL report.
With this latest addition, SGX now lists five Reit ETFs – one of the fastest-growing asset classes in Singapore’s ETF market – with total managed assets of more than S$780mn, representing an increase of close to 80% from a year ago.
“Investors want effective price benchmarks, but more importantly, highly liquid and investable instruments that are increasingly tied to standardised and validated ESG data,” Michael Syn, head of Equities at SGX, said in a statement.