Introduction to REIT

This article gives a brief introduction to the REIT (Real Estate Investment Trust) and the structure of REITs in Malaysia.

What is REIT?

REITs are trusts that are not, or appear in the stock market may include mostly in real estate costs and / or businesses, the most important activity of the estate. Revenues for the real estate industry and the company has returned to shareholders as dividends. As listed REITExchange, so that shareholders can benefit from the value of price changes as well.

REITs typically have rental properties. Therefore, rental income, in general, the income of most REITs. These rental properties are office buildings, shopping centers, etc. REIT "allows" people who like to invest in real estate investments on a large lot with a little capital and less time. Through tax incentives and / or regulations, REITs generally pay at least 90% oftaxable income to shareholders.

The REIT structure

(R) REIT Manager (Management Company)

strategies of tasks, always new acquisition and analysis of the available marketing and communication, asset performance and business planning, market analysis and other performance management activities in writing. They are also responsible for bookkeeping and other records and financial statements. REIT annual reports are prepared by the CouncilSociety.

(Ii) trust

Acting on behalf of shareholders. Control of management of the Guarantee Fund of the interests of shareholders at any time. Investments in the Fund's assets must be approved by the Directors. For example, all paychecks are signed by trustees.

Property Manager (iii)

Appointed by the Director and approved by the administrator. His responsibilities include managing, operating, market and maintain ownership of FPIcorrect.

(Iv) investments approved

(Published by the Securities Commission of Malaysia, 21 August 2008) In accordance with the guidelines for the REIT, a REIT can invest only in:

Real Estate

Land and natural part of the earth and throughout the country are below or above ground

Companies for the sole purpose

unlisted companies whose principal business is real estate. Companies are not mentioned here that the most important assetThe companies include Real Estate

Real estate related

Including shares in other REITs and real estate companies listed securities, if the securities of companies listed or unlisted debt securities issued and delivered by real estate and related securities secured by real estate.

The non-property related assets

(A) of listed shares held by non-spent;

(B) debt securities issued or fully guaranteed by the Government of Malaysia and

(C)assets or other debt securities issued by companies or institutions with credit ratings issued by none other than;

i. Malaysia Bhd and rating agency A/P1

ii. By the Malaysian Rating Corporation Bhd A/MARC-1

Cash, deposits and money market instruments;

Notes:
i. At least 50% of the value of the assets of the REIT must be a total investment in real estate and / or companies with a single function at any time.

ii. Investment in fixed assets should not exceed 25% of the totalValue of the Fund total assets.

Conclusion

With the basic understanding of the structure of REITs, we analyze the results as the single best REIT. For example, effective communication between company management and trustee entered directly affect the performance of REIT Trust etc and all the necessary permissions.

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