Real Estate Investment Trust (REITs) and Sukuk
REITs are funds that invest in real estate, which provide investors with a simple way to obtain income from property without the need to own property itself. Investors can buy and sell shares in REITs just like shares in other companies. REITs are corporate entities that own, or finance real estate. Many are Sharia’a-Compliant and they typically offer high dividend yields and the opportunity for long-term asset growth that reflects the real estate market.
Sukuk derived from the murabaha financing structure. In a sukuk al-murabaha transaction: A special purpose vehicle (SPV) buys from a supplier an asset the borrower has identified. The SPV then sells the asset to the borrower for the original purchase price plus a predetermined profit.