Could you provide a brief journey of how you arrived where you are today?
During the global financial crisis in 2008-2009, Singapore’s industrial property prices weakened. In the fourth quarter of 2009, we noticed that the industrial property sector was bottoming out which gave us an opportunity to acquire quality buildings at attractive prices. At the same time, we met numerous potential investors in Singapore and Malaysia to get their views and feedback on a potential GCC Shariah compliant industrial REIT to be listed in Singapore.
Their feedback was very positive as the market had been waiting for such a product for a long time. We then started to assemble our IPO professional working group with the aim of launching the IPO within a year. Sabana Shariah Compliant REIT was successfully listed on the SGX on the 26th November 2010. This is the first in Singapore and the world’s largest Shariah compliant REIT by total assets. More importantly, Sabana REIT has been able to attract approximately 25% of its investors from the GCC region, which is unprecedented.
What does your role involve?
As the CEO of Sabana Real Estate Investment Management, and the manager of Sabana REIT, my responsibilities are varied. I select the best people to work for us and ensure that our staff are motivated and committed to their jobs. As Sabana REIT’s manager and decision marker, I make connections with industry players to source attractive deals for the REIT. I also conduct due diligence on the shortlisted properties and head negotiations for the transactions. Lastly, as a communicator for our cause, I meet up with investors around the world and speak regularly at international conferences to educate the public about Islamic finance and Shariah compliant investing.
What is your greatest achievement to date?
To have successfully launched and listed Singapore’s first and the world’s largest Shariah compliant REIT within a year. This is an amazing feat for me given that we had to form our IPO team, sort out complex IPO processes, assemble our property portfolio and list Sabana REIT within a short 12-month period. Since Sabana REIT’s IPO, we have already won five international awards.
Despite the current market turbulence, Sabana REIT has done fairly well since the IPO. Sabana REIT shares are very liquid and we are included in the MSCI Global Small Cap Indices and a number of country and regional indexes within the Dow Jones Global Indexes family. At the same time, our property portfolio has become bigger. However, we only have one Islamic product at the moment.
What are the strengths of your business?
We have product differentiation. Sabana REIT is the only REIT in the world that adopts the GCC Shariah compliant standards.
Hence we have been able to attract many investors from the GCC region, diversifying Sabana REIT’s global investor base. In addition, we have access to top quality industrial real estate in Singapore that appeals to even conventional investors who want exposure to a stable, income producing portfolio.
What are the factors contributing to the success of your company?
We are very familiar with Singapore’s industrial property market which should continue to provide us with a healthy acquisition pipeline. We will stay focused and grow our property portfolio year after year.
What are the obstacles faced in running your business today?
Given that we have a niche product, there is a need to continue to create awareness and educate investors and the general public about the benefits of investing into a Shariah compliant REIT like us. We do not view this as an obstacle however, but as an interesting challenge that can be overcome.
Where do you see the Islamic finance industry in the next five years or so?
The Islamic banking and finance industry is growing at a faster pace than conventional banking and finance. We expect more Shariah compliant products to be introduced in Singapore and regionally, with greater sophistication.
Name one thing you would like to see change in the world of Islamic finance.
There should be an international standardization of Islamic financial instrument structures, contracts, product development and infrastructure.
This is one area that we should improve upon to see more Islamic investment products issued and attract greater interest in Shariah compliant products.