More Islamic real estate investment trusts (REITs) are expected to launch in Asia early next year and attract investors from the Arab world, said Rafe Haneef, new head of HSBC Amanah Malaysia, in an interview with Reuters.
Sabana REIT, the first shariah-compliant REIT in Singapore, which was launched on Friday, attracted a mixture of conventional and Islamic investors, of which a quarter came from the Middle East.
“The take-up (among Gulf investors) for future Islamic REITS will be a lot greater than that,” said Haneef. “At the moment there is no timeline for when other issuers will come out with Islamic REITs, but I would expect more in the first or second quarter of next year.”
HSBC Amanah Malaysia, the financial adviser for the IPO of Sabana REIT, was exploring more Islamic REIT opportunities in Singapore and Malaysia, said Haneef. Sharia-compliant REITs guaranteed higher quality investments since the screening process considered both the underlying asset and the asset’s usage, and it does not allow for risky or speculative investments.
Sabana REIT sold 508 million units at S$1.05 in its IPO, making it the biggest shariah-compliant REIT in the world.