Overview

2012 has been a comparatively good year for the real estate investment trust (REIT) sector. IGB REIT became the youngest member of the REIT family; REIT yields have fallen significantly below their historical average and several exciting acquisitions took place. Malaysian REITs, especially those with a large retail component, had healthy income levels while a flurry of news of several companies considering injecting their assets into the REIT market came into the attention of investors and the public.

IPOs and Mergers

September 2012 ended with IGB Real Estate Investment Trust (IGB REIT) being listed on Bursa Malaysia. The first day of trading for the RM4.6billion REIT saw its share price move up 11.2% compared to its initial public offering (IPO) price of RM1.25, buoyed by optimism over its property rental income and outlook. This brings the number of listed M-REITs to 16 and pushed the total market capitalization over RM23 billion.

Others have also expressed their ambitions of having REITs of their own. Naim Holdings Bhd recently said that it was considering launching its own REIT, with a target size of RM3bil.

TA Global Bhd expressed interest in forming its own REIT. KLCC Property Holdings Bhd (KLCCP) wil create Malaysia’s first stapled real estate investment trust (REIT) with over RM15bil in assets.