DETERMINANTS OF REAL ESTATE INVESTMENT TRUSTS' PERFORMANCE IN MALAYSIA

ZENOBIA, CHAI XIU BIN (2019) DETERMINANTS OF REAL ESTATE INVESTMENT TRUSTS' PERFORMANCE IN MALAYSIA. [Final Year Project Report] (Unpublished)

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Abstract

This study describes the past performance and growth of the Real Estate Investment Trusts in Malaysia (MREITs) in the early stages of development from the Q1 2010 to Q2 2019. The quarterly data is used from 2010 to 2019. M-REITs have increased from 6 in 2005 to 18 in 2019 and are growing rapidly. The attractive distribution yield of M-REITs makes it increasingly popular with Malaysian investors. This study analyses the market performance of listed M-REITs relative to interest rates, exchange rates, and GDP from Q1 2010 to Q2 2019. The study used distribution yield as the proxy for REIT performance while interest rate, gross domestic product and exchange rate to represent the determinants variable. The results provide evidence on the association between distribution yield with the interest rate, gross domestic product, and the exchange rate of REITs. REIT sectors with shorter lease durations are a better inflation hedge. This analysis will improve readers’ understanding of the attractiveness of M-REITs as an alternative investment, which will help prevent inflation. Similarly, it is hoped that the findings of this study will help investors and portfolio managers to intensify the understanding of the determinants that will influence the performance of REITs in Malaysia.

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