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. Full paper [pdf 1] [pdf 2]

To cite this paper: Ting Kien Hwa and Mohd Yunus Abdul Rahman (2007) Stability of Dividends and FFOs: The Case of REITs in Malaysia. 13TH PACIFIC RIM REAL ESTATE SOCIETY ANNUAL CONFERENCE Fremantle, Perth, Australia, 21 – 24 January 2007