THE POTENTIAL OF ISLAMIC REAL ESTATE INVESTMENT TRUSTS IN MALAYSIA
Keywords:
Islamic Capital Market, Conventional REIT, Islamic REIT, property investment, diversification benefitsAbstract
The purpose of this paper is to expand on the research written on the Islamic Real Estate Investment Trusts (I-REITs) thus far; this is to further expose its potential in Malaysia. I-REITs is one of the products of Islamic Capital Market investment which is based on real estate. Even though I-REITs have been established for almost 10 years, only three I-REITs are listed in Bursa Malaysia as at 31 December 2014. Based on a previous study, I-REITs has considerable potentials; these have yet to be revealed. An I-REIT is a property investment that can act as a hedge against inflation. The diversification benefits offered by I-REITs is better than Conventional REITs (C-REITs). The returns of I-REITs in the form of distribution yield are fluctuating, uncertainty and still profitable.