Real Estate Investment Trust (REIT) is a vehicle for investors to access properties which they do not have the capital to access as an individual investors. Properties such as large industrial warehouses or factories, commercial malls and hotels are common asset class in a REIT. REITs have been gaining popularity in Malaysia and here are some of the major trust listed in the country.
Mid Valley and Pavilion
Owner to one of the largest shopping mall in Malaysia, IGB REIT (IGBREIT:MK) is the asset owner of Mid Valley and The Gardens. Both malls well known in the capital of Malaysia and sponsored by the developer IGB Corp (IGB:MK). IGB REIT currently offers a distribution yield of about 5.8% and is valued at slightly over RM4 billion.
Equally popular is the Pavilion mall right in the city centre. Both the Pavilion Mall and the Pavilion Tower is owned and managed by Pavilion REIT (PREIT:MK). This REIT is very similar to IGB REIT and also offers a distribution yield of around 5.5% for investors.
Sunway REIT (SREIT:MK) is a special REIT sponsored by Sunway Bhd (SWB:MK). The REIT has a portfolio of shopping malls, hotels, commercial towers and even a medical centre. It provides an interesting exposure to the real estate market together with the properties developed by Sunway Bhd. The REIT currently offers a distribution yield of about 6%.
The King Of Malaysia REIT
What do you think of when we mention Malaysia? What can be more iconic for Malaysia than the Petronas Twin Tower? KLCC REIT is the owner of the major towers in the KLCC area, including the iconic Twin Tower. The REIT is the largest REIT listed in Malaysia and has a unique structure as a stapled securities with KLCC Property Holdings Berhad. The stapled securities are majority owned by Petronas, the oil and gas major of the country.
Value In Action
For investors looking to gain access into the Malaysia’s real estate, instead of direct investment, maybe one can consider the use of REIT as an alternative.
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All views and opinions articulated in the article were expressed in Stanley Lim’s personal capacity and does not in any way represent those of his employer and other related entities. Stanley Lim does not own any shares in the companies mentioned above.