Friday, January 19, 2018


REITs (REAL ESTATE INVESTMENT TRUSTs), Now can trading it shares at most of the major share market. A lot of people in doubt, they understanding is real estate is an agent of property. Why REITs can listing the shares? What is there basic income? Their Agent fees can registered multi million turnover per annum, is it true? Why in their annual report got some much of assets? 

Those above question actually can answer by WIKIPEDIA OR GOOGLE.

A REIT is a company that owns, operates or finances income-producing real estate. Modeled after mutual funds REITs provide all investors the chance to own valuable real estate, present the opportunity to access dividend-based income and total returns, and help communities grow, thrive and revitalize. 

REITs allow anyone to invest in portfolios of real estate assets the same way they invest in other industries – through the purchase of individual company stock or through a mutual fund or exchange traded fund (ETF). The stockholders of a REIT earn a share of the income produced through real estate investment – without actually having to go out and buy, manage or finance property. 

In Malaysia, there are 18 REITs companies listed in bursa. Which one is better? Last year, a BNM's President has been commented there are numbers of shopping complex and high rise commercial building soon to complete the project in the coming month.

So, ordinary people now suffering the high cost of living and wondering how many people can spend more in those coming new shopping complex. This indirect affected business man's decision, whether they should expand or start a new business in this period of times.

On the others hand, Amazon Company, Alibaba,JD (京东) and others on line retailers, recently plan to landed their business by way of acquired some chain stores. Initially, they are bit down all the retail with zero rental cost but now they use their earning to acquire the opponent parties business.

However, personally I down grade all REITs company earning power in the next two years. Because of : -
1) Most of the management team in the company no specific skill to face the impact of on line retailer.
2) Our labour cost increased affected those Store and Factory operator business man reallocate their business place.
3) Demand vs Supply, now favourable on Supply.
4) Government implemented Industries 4.0, the facilities of the factory need to change.
5) Spending power of Malaysian Citizen low because of property and shares market weak in last two years. As well as Ringgit vs USD weak in last 3 years.
6) The objective or strategy of the company is based on one word - 'WAIT". Wait for the property price up. In their mind, time cost is not a cost and seems like in their world also no "Net Present Value" issue.  

A full of dynamic economic must have spring issue, crazy scientist/creator and strong energy of population. But here, you hardly to see such character.