Retail REITs with malls in good locations the flavour

PETALING JAYA: In a volatile market, investors seeking regular income have flocked to Malaysian real estate investment trusts (REITs) due to their attractive dividend yields. But with expectations that interest rates may remain unchanged at 3% for the rest of the year, this class of investment could lose some appeal.

“We do not expect Bank Negara to cut its current overnight policy rate (OPR) of 3% during the year; hence, we do not foresee yield seekers flocking back to REITs in a major way,” Kenanga Research said in a report, reiterating its “neutral” stance on the sector.