Total factor productivity change in the REIT industry: The case of Malaysian REITs during and post global financial crisis

Nor Nazihah Chuweni, Ihsan Isik, Andrea Blake

Research output: Contribution to journalArticlepeer-review

1 Scopus citations

Abstract

The paper examined productivity changes for the Malaysian Real Estate Investment Trust (M-REITs) using a non-parametric approach of Malmquist Productivity Index (MPI) of Data Envelopment Analysis (MPI-DEA). Data was attained from M-REIT annual reports, Thomson Reuters Datastream and Osiris via Bureau Van Dijk for 2007-2015. The non-parametric approach of MPI-DEA examined the Total Factor Productivity Change (TFPCH), Technological Change (TECHCH), Efficiency Change (EFFCH), Pure Technical Efficiency Change (PEFFCH) and Scale Efficiency Change (SECH) indices. On average, the M-REIT industry has faced 14.91% of productivity regress during 2007-2015 period, comprising 49.90% of efficiency increase and 33.40% technological regress. The decomposition of the productivity change index suggests that Malaysian REIT productivity changes were mainly due to efficiency change rather than technological change. These findings could help M-REIT managers to formulate ways to enhance their REIT productivity. The findings are also applicable to similar Shariah compliant real estate investment or socially responsible investment.

Original languageEnglish (US)
Pages (from-to)149-159
Number of pages11
JournalPlanning Malaysia
Volume17
Issue number1
DOIs
StatePublished - 2019

All Science Journal Classification (ASJC) codes

  • Geography, Planning and Development
  • Urban Studies

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