149 ANNUAL REPORT 2022 The Fund and its investment objective (cont’d.) The principal activity of the subsidiary is as a special-purpose company for the purpose of raising Islamic financing for Al-Salām Real Estate Investment Trust. This objective is sought to be achieved by optimising the performance and enhancing the overall quality for a large and geographically diversified portfolio of Shariah-compliant real estate assets through various permissible investment and business strategies. The Manager and its principal activity The Manager is a company incorporated in Malaysia and is a wholly-owned subsidiary of Damansara Assets Sdn Bhd, a company incorporated in Malaysia. The directors of the Manager consider Johor Corporation as the ultimate holding corporation of the Manager, a body corporate established under the Johor Corporation Enactment No. 4, 1968 (as amended by Enactment No. 5, 1995). The principal activity of the Manager is that of managing real estate investment trusts. There has been no significant change in the nature of the principal activity during the financial year. 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 specified above but specified 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 fit 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 financing acquisitions, seek to manage financing and refinancing risk and to adopt an active financing rate management strategy to manage the risks associated with changes in financing 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, Shariahcompliant deposits and Islamic money market instruments, MANAGER'S REPORT (cont’d.)
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