It will not be all doom and gloom for Malaysian real estate investment trusts (REITs) next year, with potential upside from the injection of new assets and extensive refurbishment of existing portfolio assets in the past 12 months.

There are currently 16 REITs listed on Bursa Malaysia and the largest player is KLCC Stapled Group, which has property assets in excess of RM12 billion.

MIDF Research head Zulkifli Hamzah expected select REIT players to continue to do well, particularly those with quality properties in the commercial, industrial and healthcare space.

He is recommending REITs with strong assets, such as Sunway REIT, Al-Aqar Healthcare REIT, IGB REIT, KLCC Property Stapled REIT and Pavilion REIT.

Quill Capita REIT can also be considered as it has opened the Kampung Baru mall, which will contribute 100 per cent to its earnings next year.

Zulkifli said judging from the condition of the property market, there could be some easing in prices, given the softer market condition.

“Hence, we do not expect the REIT players to rush into buying as they would rather keep a wait-and-see stance. The gestation period for new acquisitions could be lengthy due to the purchasing process, further enhancement that might be needed, as well as ensuring the right tenant mix,” he said. —New Straits Times