A review of efficiency measures for REITS and their specific application for Malaysian Islamic REITS

Chuweni, N and Eves, A 2017, 'A review of efficiency measures for REITS and their specific application for Malaysian Islamic REITS', Journal of Islamic Accounting and Business Research, vol. 8, no. 1, pp. 41-53.


Document type: Journal Article
Collection: Journal Articles

Title A review of efficiency measures for REITS and their specific application for Malaysian Islamic REITS
Author(s) Chuweni, N
Eves, A
Year 2017
Journal name Journal of Islamic Accounting and Business Research
Volume number 8
Issue number 1
Start page 41
End page 53
Total pages 13
Publisher Emerald Publishing
Abstract Purpose: This paper aims to present a conceptual model on the efficiency of Islamic real estate investment trusts (I-REITs) available in Malaysia. The key difference between the Islamic and their conventional investment vehicle part is mainly its own Shariah framework. For instance, I-REITS must comply with the requirement of Securities Commission Act 1993 as well as the Guidelines on Islamic Real Estate Investment Trusts (Islamic REITs Guidelines). Design/methodology/approach: The paper reviews and synthesises the relevant literature on the performance analysis and efficiency measurements of REITs. The paper then develops and proposes a conceptual model to measure the efficiency of Malaysian and Islamic REITs. Findings: The paper identifies and examines the appropriate methods and instruments to measure the efficiency in relation to the risk and profitability of I-REITs. The efficiency measure is important for the fund managers to maximise the shareholders' return in an investment of property portfolio as well as proposing the best way to allocate resources efficiently. Research limitations/implications: This is a preliminary review of current work that identifies the issues that will be addressed in future empirical research. The authors will be undertaking this future empirical research in measuring the efficiency of Malaysian real estate investment trusts (M-REITs), particularly the I-REITs, using the non-parametric approach of data envelopment analysis. Originality/value: To date, there has been very limited research on the efficiency measurement of I-REITs. The current analysis of REIT has been focused on traditional non-Islamic funds. This paper will review and discuss the current literature on efficiency measurement to determine the most appropriate approaches and methodologies for future application in performance analysis of efficiency measure for Malaysian and Islamic REITs.
Subject Real Estate and Valuation Services
Building not elsewhere classified
Keyword(s) Data envelopment analysis
Efficiency
Islamic REITs
M-REITs
DOI - identifier 10.1108/JIABR-03-2015-0007
Copyright notice © Emerald Publishing
ISSN 1759-0817
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