10 Best Real Estate Investment Trusts (REITs) in Malaysia

REITs permeate our surroundings, and it’s safe to say that almost every Malaysian has encountered a REIT in some form. From the shopping malls and office buildings we step into to the hotels, factories, and warehouses we rely on, REITs often own and manage these properties.

Consider the beloved malls of your youth, like Mid Valley and Sunway Pyramid. IGB REIT and Sunway REIT are the proud owners, and they’ve consistently delivered a strong performance in my Freedom Fund.

When introducing the concept of REITs to others, I find it helpful to draw a parallel to mutual funds. What makes REITs Malaysia truly fascinating is their ability to empower small investors like us to partake in the ownership of valuable real estate that would otherwise be financially out of reach.

This article will delve deeper into a brief introduction of REITs and the reasons why Malaysia is a good REITs investment opportunity, the advantages of adding some of the best REITs in Malaysia and understanding the tax benefits in sections.

What are REITs?

REITs are investment funds or trusts that own and manage income-generating commercial real estate properties, including shopping malls, offices, hotels, hospitals, and industrial properties.

Types of REITs Malaysia

There are primarily five types of best REITs in Malaysia :

• Retail REITs – focusing on shopping malls.
• Hospitality REITs – centered around hotels and serviced residences.
• Office REITs – specializing in office buildings.
• Industrial REITs – dealing with warehouses, logistics facilities, and data centers.
• Healthcare REITs – dedicated to hospitals and nursing homes.

Why Malaysia? A Glimpse into the Malaysian Real Estate Market

Despite economic uncertainties and external challenges like the global pandemic, Malaysia’s property market has demonstrated resilience in 2023.

Growth projections may be slightly lower, but industry experts maintain optimism. Supportive government policies, incentives, and monetary measures have boosted property transactions and confidence among buyers and investors.

The commercial property segment has grown due to increased e-commerce and logistics services demand. Infrastructural developments, such as improved transportation systems, have also enhanced property appeal.

These factors collectively illustrate the property market’s ability to adapt and thrive in challenging times.

After learning about and understanding the Malaysian REIT market, let’s take a look at some of the best REITs in which you can invest in Malaysia.

Summary Table: Top 10 Best REITs in Malaysia (2025)

Top 10 Best REITs in Malaysia (2025)

1. Sunway REIT

Portfolio: Retail, Hospitality, Office
Key Properties: Sunway Pyramid Mall, Sunway Resort, Sunway Medical Centre
Dividend Yield: 4.88%
Market Capitalization: RM4.93 billion

Sunway REIT remains one of the largest and most diversified REITs in Malaysia, with 20 properties spanning retail, hospitality, and healthcare. Its consistent dividend payout and strategic assets in prime locations ensure long-term stability.

2. KLCC Property Stapled REIT

Portfolio: Office, Retail, Hospitality
Key Properties: PETRONAS Twin Towers, Suria KLCC, Mandarin Oriental KL
Dividend Yield: 4.0%
Market Capitalization: RM13.4 billion

KLCC Property Stapled REIT boasts premium-grade properties with near-full occupancy rates. Its iconic portfolio and stable dividends make it a favorite among conservative investors.

3. Pavilion REIT

Portfolio: Retail, Office
Key Properties: Pavilion KL, Pavilion Tower, Intermark Mall
Dividend Yield: 3.7%
Market Capitalization: RM4.0 billion

With a focus on high-traffic retail malls in prime areas, Pavilion REIT ensures robust footfall and tenant demand. However, its exposure to retail makes it sensitive to economic cycles.

4. Sentral REIT

Portfolio: Office, Retail
Key Properties: Menara Shell, Platinum Sentral
Dividend Yield: 8.2%
Market Capitalization: RM1.2 billion

Sentral REIT offers the highest dividend yield in the sector, with a solid tenant base in office spaces. Its portfolio stability ensures consistent income despite potential market headwinds.

5. IGB REIT

Portfolio: Retail
Key Properties: Mid Valley Megamall, The Gardens Mall
Dividend Yield: 3.1%
Market Capitalization: RM5.4 billion

IGB REIT continues to excel, maintaining near-full occupancy in two of Malaysia’s most popular malls. Its proven resilience during economic downturns makes it a top pick for retail-focused investors.

6. Capitaland Malaysia Mall Trust

Portfolio: Retail
Key Properties: Gurney Plaza, The Mines, East Coast Mall
Dividend Yield: 4.8%
Market Capitalization: RM2.1 billion

This REIT focuses on suburban malls with high foot traffic. It is poised for recovery as retail spending rebounds, making it an attractive option for mid-risk investors.

7. UOA REIT

Portfolio: Office
Key Properties: Menara UOA Bangsar, UOA Corporate Tower
Dividend Yield: 8.0%
Market Capitalization: RM720 million

UOA REIT specializes in premium office spaces in urban centers, offering high yields. However, its reliance on office properties makes it vulnerable to hybrid work trends.

8. Axis REIT

Portfolio: Industrial
Key Properties: Klang Valley, Johor, Penang properties
Dividend Yield: 5.2%
Market Capitalization: RM2.99 billion

Axis REIT dominates the industrial REIT sector, focusing on logistics and manufacturing properties. Its diverse portfolio across Malaysia ensures steady returns even in challenging times.

9. YTL Hospitality REIT

Portfolio: Hospitality
Key Properties: The Majestic Hotel KL, JW Marriott KL, Niseko Village properties
Dividend Yield: 5.2%
Market Capitalization: RM1.5 billion

With properties spanning Malaysia, Japan, and Australia, YTL Hospitality REIT offers geographical diversification. It is poised for growth as international travel recovers post-pandemic.

10. Al-Aqar Healthcare REIT

Portfolio: Healthcare
Key Properties: KPJ Specialist Hospitals, KPJ University College
Dividend Yield: 6.8%
Market Capitalization: RM1.8 billion

This REIT’s exclusive focus on healthcare ensures stable cash flows, even during economic uncertainty. Its defensive nature makes it a strong pick for conservative investors.

Why You Should Invest in Malaysian REITs?

1. The Power of 90% Distribution for Prosperous Dividends

REITs employ a tax-efficient strategy, ensuring that a substantial portion of their earnings, typically a remarkable 90% of the rental income amassed from their expansive real estate holdings, is distributed to shareholders.

The benefits of reduced stamp duty and Real Property Gains Tax (RPGT) are staggering, ultimately translating into generous dividends for discerning investors.

More often than not, the dividends dispensed by REITs Malaysia eclipse those of their corporate peers. This is precisely why I perceive REITs as an inherently defensive investment, owing to their tangible real estate assets and the alluring dividend yields they bestow.

If you want to become an investor focusing on dividends to build a passive income, check out this page on 10 High Dividend Stocks in Malaysia.

2. Diversification: A Multifaceted Canvas

REITs offer a canvas of diversification for your investment portfolio that is nothing short of impressive.

By investing in one of the best REITs in Malaysia, such as Sunway REIT, your capital is instantaneously diversified across various property types and geographical locations. Your investments encompass an array of assets, including shopping malls, hotels, and office spaces spread across multiple states in Malaysia.

In contrast, acquiring a physical property individually would, at best, allow you to include a mere 3-4 properties in your portfolio, constrained by the limitations of time and capital. The choice seems rather self-evident.

3. Low Entry Threshold for Aspiring Real Estate Tycoons

With as little as RM1,000, you can stake your claim in the realm of shopping malls, office towers, industrial warehouses, and even hotels, building your very own real estate empire.

It is worth noting, however, that an initial investment of RM3,000 is advisable, with RM7,000 to RM8,000 being the most optimal, considering brokerage fees.

A detailed comparison can be found here if you seek to explore the fee structures of Malaysian brokerages.

4. Liquidity: The Swift Current of Investment

Contrasting the sale of shares in some of the best REITs in Malaysia with the disposal of physical property reveals a striking distinction.

While you can seamlessly buy and sell REIT shares within a matter of minutes, the arduous process of selling a residential unit entails legal procedures, real estate agents, and potential buyers, leading to a timeframe of several weeks before liberation from the property’s ownership.

In times of financial exigency, the significance of liquidity becomes all too apparent. Beyond emergencies, REITs’ fluidity saves precious time and minimizes associated fees, making it a judicious choice for the astute investor.

5. Entrust the Professionals

Relax and allow seasoned real estate specialists to oversee your properties.

Consider the owners of a billion-ringgit shopping complex like Mid Valley and the Gardens— they enlist top-tier experts with vast experience to manage their properties.

With such expertise in your corner, you can confidently delegate property acquisitions, sales, and management to true professionals.

How to Buy REITs in Malaysia?

Investing in Real Estate Investment Trusts (REITs) in Malaysia involves several important steps. This guide outlines how to purchase REITs, focusing on selecting the appropriate brokerage platform, opening a trading account, and completing the purchase.

Step 1: Selecting a Brokerage Platform

The initial step is to choose a brokerage platform suitable for your needs. Options include Mplus Online, AmEquities, HL e-Broking, and Affin Hwang Investment Bank Trading Account. Each platform offers unique features:

• Mplus Online: This platform is user-friendly and ideal for beginners, offering competitive rates and real-time market data.
• AmEquities: Suitable for those seeking to invest in local and international markets, it provides a comprehensive investment experience with real-time updates.
• HL e-Broking (Hong Leong Bank Trading): Known for its advanced charting and technical analysis tools, it caters well to experienced traders and offers foreign and multi-currency trade settlements.
• Affin Hwang Investment Bank Trading Account (eInvest Go): This platform is recognized for its diverse investment options and live updates on trading.

Step 2: Opening a Trading Account

After selecting a brokerage, the next step is to open a trading account. This usually requires submitting personal identification documents and filling out an application form. Some platforms might require in-person branch visits, while others offer online processes.

Step 3: Funding Your Account

Once your account is active, you must deposit funds, typically through a bank transfer. It’s crucial to consider the minimum deposit requirements and transaction fees.

Step 4: Researching and Selecting REITs

Before investing, research to identify REITs that align with your investment goals. The REIT’s performance history, dividend yield, and property portfolio are key factors.

Step 5: Making the Purchase

Finally, purchase your chosen REITs using your trading platform. This involves placing a buy order for a specific number of shares at either the current market price or a set limit price.

Investing in REITs in Malaysia can be a rewarding experience, offering a blend of regular income and potential capital appreciation.

By following these steps and choosing the right platform, like those mentioned in the “Best Share Trading Platforms in Malaysia” article, you can start your REIT investment journey on a strong footing​.

Remember, it is advisable to engage in a comprehensive study and consult with financial experts before making investing choices.

Understanding Tax Advantages of Malaysian REITs

The Malaysian government has consistently introduced tax incentives to foster the growth of REITs within the capital market.

Advantage 1: A substantial portion of its earnings remains exempt from income tax.

The criterion is that the REIT needs to disburse a minimum of 90% of their taxable income for the current year, and they are spared from the burden of the 25% income tax. This provision allows REITs to distribute their income on a gross basis.

Under this tax regime, the vast majority, if not all, Malaysian REITs meet the requirement to distribute at least 90% of their taxable income. This, combined with the absence of a 25% income tax, consistently results in dividend payments from REITs that far surpass those from other shares.

Nevertheless, as publicly listed entities, REIT investors encompass a wide spectrum, from local investors to foreign individuals and entities. The complexity of tracking tax payments for this diverse pool of investors has prompted REITs to impose a withholding tax on their dividends.

While Malaysia’s withholding tax rate is among the lowest globally, we trail behind certain nations, primarily our neighbour, Singapore.

Advantage 2: Exemption from property-related taxes.

When a Malaysian REIT acquires properties, it is not obligated to pay stamp duties, which typically amount to a maximum of 3% of the purchase price. Similarly, when REITs in Malaysia divest their assets, they are not subjected to the Real Property Gains Tax (RPGT).

The savings afforded to REITs through these exemptions are substantial and can be calculated to grasp the extent of these benefits.

Advantage 3: Special Tax Treatment of Malaysian REITs

The tax treatment of a REITs Malaysia hinges on the amount of income disbursed to shareholders.

Two pivotal conditions govern the tax treatment of Malaysian REITs:

1. If one of the best REITs in Malaysia allocates a minimum of 90% of its taxable income, it remains exempt from corporate income tax.

2. In cases where the 90% distribution threshold is not met, the REIT becomes subject to the prevailing corporate tax rate of 24%.

Consequently, Malaysian REITs generally adhere to the practice of disbursing at least 90% of their taxable income in dividends. As an investor focused on dividends, REITs hold a particular allure for me and constitute a prominent portfolio component.

What Happens If You Are A Resident Shareholder?

To benefit from tax credits, you have to be a tax resident.

Withholding tax is the final tax and occurs when Malaysian REITs meet the 90% distribution threshold.

Individual and non-corporate investors are relieved from the obligation to report REIT dividend income in their tax returns, and tax credits are unavailable in the absence of corporate tax payments by the REIT.

Shareholder dividend distributions are subject to a final withholding tax rate of 10% for residents and individuals.

Conclusion

In summary, thorough research is crucial before making any investment, as the quality of REITs in Malaysia varies. By gaining insight into the various types of industrial REITs, you can make a well-informed choice that aligns with your specific requirements. Some of the best REITs in Malaysia presented here serve as a valuable initial reference for further exploration in this market.

Frequently Ask Questions

**Disclaimer: This article is only offered for general informational reasons and is not meant to cover all facets of the subjects it addresses. It is not meant to be taken as legitimate investment advice you should rely on. You must seek expert or professional advice before acting or refraining from acting based on the information in this publication. The content in this publication does not represent advice from the BizTech Community. A comparable outcome is not always assured by past performance. We give no assurances that the information in the publication is accurate, full, or up to date, either explicitly or implicitly.