ABSTRACT
This chapter aims to provide a broad analysis of the development of Islamic real estate investment trusts (REITs) and discusses relevant Shariah rules that govern the investments and business activities of Islamic REITs. It gives an overview of the development of the Islamic financial market globally. The chapter discusses the key features underlying the Islamic financing system, and compares the structures of conventional and Islamic REITs. It provides a description of the development of Islamic REIT markets in Malaysia and other countries and case studies of Islamic REITs to illustrate issues relating to structure, investment portfolios and management. Islamic finance relies on an asset-backed feature in the product design to protect investors against extreme market risk. It offers a relatively resilient alternative to the conventional financial system that has proven better able to withstand extreme volatility during crises. As a non-Muslim country, the Singapore government takes a broad-based approach to developing its Islamic financial system.
