Could you provide a brief journey of how you arrived where you are today?
I started my professional career as an officer in Malaysia’s finance ministry, and have more than 20 years experience in the real estate industry. I held various positions in a number of public-listed companies before joining Johor Corporation Group nine years ago. I started as the CEO of Damansara REIT Managers upon establishment of Al-Aqar KPJ REIT in 2006, the world’s first listed Islamic real estate investment trust (REIT), in Malaysia.
What does your role involve?
As the CEO, I am responsible for all aspects of the company. However my focus can be categorized into three key areas: operations, performance and growth. So not only do I have to ensure the smooth operations of the Al-Aqar KPJ REIT, but also have a responsibility to the unit holders to generate good returns. I also look into the ongoing promotion of the Al-Aqar KPJ REIT, creating awareness of our product and marketing it to potential investors. This is all part and parcel of driving the growth of the fund.
What do you consider your greatest achievement to date?
Going solely by the numbers, the Al-Aqar KPJ REIT has already achieved our target for the next five years. When we launched the Al-Aqar KPJ REIT in 2006, we set out to achieve RM1 billion (US$284.3 million) in total asset size by 2011. However we exceeded this within the first three years. The product was awarded the I-REIT Deal of the Year 2006 by Islamic Finance news.
Which of your products/services do you feel deliver the best results?
We are very proud of the Al-Aqar KPJ REIT as it has set many milestones in the industry. Besides being the world’s first listed Islamic REIT, it is also the first healthcare REIT in Asia, first REIT listed in Malaysia under the Securities Commission’s guidelines for Islamic REITS, and it has set a benchmark and paved the way for the development of Islamic REITs globally. The Al-Aqar KPJ REIT also delivers a consistent income return due to several key factors — a stable rental income from the hospital buildings, a 100% occupancy rate, minimum risk and single exposure in the healthcare business. The fund’s investors will also gain from the anticipated capital appreciation on the units purchased.
What are the strengths of your company?
Our uniqueness lies in our pioneering status as the first Islamic REIT and that our focus is in the healthcare industry. Therein lie our strengths. We also have a very reputable sponsor of the REIT, KPJ Healthcare (KPJ), which is the healthcare arm of Johor Corporation and is the first homegrown healthcare group in Malaysia. KPJ has more than 25 years experience in the healthcare industry and is one of the largest groups of private healthcare providers in Malaysia.
What are the factors contributing to the success of your company?
As managers of the fund, Damansara REIT Managers has been the driving force behind the success of Al-‘Aqar KPJ REIT. We also have supportive board members who have vast experience in the industry. Our alliances with our business partners such as advisors and lawyers have also contributed to the success of our endeavors. And, of course, the cornerstone of our success has always been the steadfast support of our unit holders..
What are the challenges/obstacles the company faces today?
The current economic climate has affected almost all businesses. However, Damansara REIT is prepared to weather the storm. On a more specific note, the biggest challenge we face is the need for more education and awareness on REITs, especially in the Malaysian market. A lot needs to be done to aggressively promote REITs as an attractive investment product for individuals and corporations. In this respect, the regulatory bodies can play an important role by providing incentives for firms to take up REITs. For instance, a tax reduction on dividends for corporate investors would most definitely help boost the growth of REITs in the country.
Where do you see the Islamic finance industry in, say, the next five years?
The global economic crisis has helped to shed light on Islamic finance as a strong and credible alternative to conventional financing. In some ways, the crisis could have been averted by utilizing Shariah principles of transparency, risk mitigation and asset-backed transactions.
Islamic finance has grown by leaps and bounds in the past five years and I am confident that it will assume a more prominent role in the coming years, especially in western countries.
Name one thing you would like to see change in the world of Islamic finance.
The lack of standardized documentation and practices has often been highlighted as one of the main constraints to the global Islamic finance industry. For the continued growth of the industry, a framework should be developed based on internationally recognized principles and standards. This would also boost confidence and encourage more market players to adopt Islamic finance and banking practices.