Submitted by: Submitted by sirah83
Views: 342
Words: 3617
Pages: 15
Category: Business and Industry
Date Submitted: 10/21/2011 05:49 AM
13TH PACIFIC RIM REAL ESTATE SOCIETY ANNUAL CONFERENCE Fremantle, Perth, Australia 21 – 24 January 2007
Stability of Dividends and FFOs: The Case of REITs in Malaysia
Ting Kien Hwa and Mohd Yunus Abdul Rahman
Department of Estate Management Faculty of Architecture, Planning & Surveying
University of Technology MARA
40450 Shah Alam, Selangor Malaysia
Telephone : 603 - 5544 4217, Fax : 603 – 5544 4353, e-mail : tingkienhwa@yahoo.com
Keywords : dividends, FFOs, LPTs, Malaysia
13th Pacific Rim Real Estate Society Annual Conference
Ting Kien Hwa
Stability of Dividends and FFOs: The Case of REITs in Malaysia
Abstract
Historically, the dividends of real estate investment trusts (REITs) contribute significantly towards the total return of REITs. This paper examined whether dividend returns of REITs/LPTs in Malaysia are affected by economic conditions and whether the level of dividends declared could be sustained in a weak economy. The research shows that the dividends declared by listed property trusts (LPTs) are found to be not stable as it is affected by the level of funds from operations (FFOs) attained by LPTs. FFOs are in turned affected by its sources of income. LPTs with investments of unstable market values e.g. shares which have declined in values is found to affect FFOs due to the need to account for its diminution of values in the accounts. The findings have an impact on investors who expect consistent dividend distributions from LPTs thereby affecting their investment allocations on LPTs.
Keywords : dividends, FFOs, LPTs, Malaysia
2
13th Pacific Rim Real Estate Society Annual Conference
Ting Kien Hwa
Introduction Real estate investment trusts (REITs) have traditionally been able to attract investors because of their relatively low risks and high dividend yields. The high dividend yield of REITs is the main reason investors invest in the REIT market. Investors e.g. pensioners who rely on regular dividend payments are...