AL-SALAM REIT ANNUAL REPORT 2018

AL-SALĀM REIT ANNUAL REPORT 2018 99 The principal activity of the subsidiary is set out in Note 12 to the inancial statements. MANAGER’S INVESTMENT STRATEGIES AND POLICIES The Fund is authorised to invest in real estate, special-purpose-vehicles (“SPVs”), real estate-related assets, non-real estate- related assets, cash, Shariah-compliant deposits, Islamic money market instruments and any other investments not speciied above but speciied as a permissible investment in the Guidelines on Real Estate Investment Trust (“the REIT Guidelines”) and the Guidelines for Islamic Real Estate Investment Trust (“the Islamic REIT Guidelines”) as issued by the Securities Commission Malaysia or as otherwise permitted by the Securities Commission Malaysia. To achieve the Fund's primary objective, the Manager will seek to achieve the following strategies: (a) Active asset management strategy The Manager will seek to optimise the rental rates, occupancy rates and Net Lettable Area (“NLA”) of the Fund’s properties in order to improve the returns from the Fund’s property portfolio. (b) Acquisition growth strategy The Manager will source for and acquire properties that it within the Fund’s investment strategy to enhance returns to unitholders and to capitalise on opportunities for future income and net asset value growth. (c) Capital and risk management strategy The Manager will endeavour to employ an appropriate mix of debt and equity in inancing acquisitions, seek to manage inancing and reinancing risk and to adopt an active inancing rate management strategy to manage the risks associated with changes in inancing rates. The investments of the Fund are subject to the following investment limits imposed by the REIT Guidelines: (a) at least 50% of the Fund’s total asset value must be invested in real estate assets at all times; and (b) not more than 25% of the Fund’s total asset value may be invested in non-real estate-related assets and/or cash, Shariah- compliant deposits and Islamic money market instruments, provided that instruments in both real estate-related assets and non-real estate-related assets are limited as follows: (a) the value of the Fund’s investments in securities issued by any single issuer must not exceed 5% of the Fund’s total asset value; (b) the value of the Fund’s investment in securities issued by any group of companies must not exceed 10% of the Fund’s total asset value; and (c) the Fund’s investment in any class of securities must not exceed 10% of the securities issued by any single issuer; or such other limits and investments as may be permitted by the Securities Commission Malaysia or the REIT Guidelines. Manager’s Report - Cont’d