ANALYSING THE REGULATORY FRAMEWORK OF i-REITS IN MALAYSIA, SINGAPORE, AND INDONESIA

Abstract

REIT, according to the Security Commission (Malaysia), is an investment that aims to invest in real estate for at least 50%. This investment can be made through two channels: direct ownership or a single-purpose company whose principal asset is real assets. Malaysia can be viewed as a model of a comprehensive framework. Indonesia has an excellent regulatory structure nearly as extensive as Malaysia's. However, there is still a lack of interest in i-REITs there, which could be attributed to a lack of knowledge about i-REITs. Sabana REIT, one of Singapore's most popular "Shariah Compliant '' REITs, has recently opted to abandon its Shariah compliance. Furthermore, the country currently has a formal legislative framework for Islamic REITs, and its governance primarily relies on the Shariah Committee of each i-REIT, which may be more difficult to achieve given that its prime model (Sabana REIT) is no longer Shariah compliant. Therefore, this study aims to further analyse if there is a difference in the development of regulations for i-REITs in Malaysia, Singapore, and Indonesia, along with the challenges that come from expanding investments throughout the ASEAN countries.