In FY2015 ended Dec 31, IGB REIT’s pre-tax income was RM254 million compared with RM153.29 million in FY2012. The investment trust’s pre-tax profit in FY2014 was higher at RM317.62 million but it took into account the surplus from revaluing its properties.

For REITs, it is more apt to measure their distributable income and for IGB REIT, this grew 366.82% from FY2012, or an average of 67.13% per year, to RM290.98 million in FY2015, the biggest among that of its peers.

The feat was even more impressive, given that IGB REIT has not relied on asset injection for growth since it listed four years ago.

Different REITs have different investment strategies to maximise returns to unit holders and their growth potential. IGB REIT is blessed with three things — location, location, location — which every property owner and developer covet.

The investment trust owns only two properties, namely Mid Valley Megamall and its premium sister The Gardens Mall, and it would not be a surprise if almost every Klang Valley resident has visited these malls at least once. Mid Valley City is, after all, surrounded by affluent Kuala Lumpur neighbourhoods. It is right next to the Federal Highway — the spine that runs through the Klang Valley and a terminus for residents from nearby states to Kuala Lumpur.

And the malls have taken advantage of their location to distinguish themselves further from others.

In fact, it could be argued that Mid Valley Megamall popularised lifestyle malls in Malaysia in the early 2000s. It was the first home to fast fashion brands Topshop, Zara and Forever 21 when they expanded to this country, and it was where PPB Group Bhd-owned Golden Screen Cinemas debuted its Gold Class cinema hall.

When The Gardens Mall opened its doors in late 2007, the then owner IGB Corp Bhd had a dedicated home for luxury brands, further cementing Mid Valley Megamall’s status as the “it” shopping mall — even when Kuala Lumpur’s shopping mall scene was getting crowded.

As at December last year, Mid Valley Megamall and The Gardens Mall had a combined net lettable area of 2.64 million sq ft — double that of the uber-glamorous Pavilion Kuala Lumpur — enabling IGB REIT to host retailers of various types that cater for a whole spectrum of consumer income levels.

It might be difficult to put a value on branding but analysts have said that IGB REIT’s malls have, over the years, had rental reversion rates in the teens. They have also consistently registered full occupancy even when consumer sentiment began to wane in the third quarter of 2014.

This year might be IGB REIT’s toughest yet as another part of the REIT’s success is its high reliance on percentage cuts from tenant sales, which AllianceDBS Research Sdn Bhd said made up over 10% of the REIT’s revenue. Thus, many analysts have pointed out that the risk to their calls is if shoppers spent substantially less amid weakened consumer sentiment.

And it might seem a bit too late to jump on the IGB REIT bandwagon. Its units had jumped nearly 20% year to date as at Aug 16, the most among all REITs. However, at RM1.60 per unit, analysts see 5.5% yield.