Finance
By
Dr. Mohammad Tahir Sabit Haji Mohammad
Department of Land Administration and Development,
Faculty of Geoinformation Sciences and Engineering
University Technology Malaysia
Innovative Modes of Financing the Development of Waqf Property 1
Innovative Modes of Financing the Development of Waqf Property 2
1. Introduction 2
2. Credit-based financing 3
2.1. Build and Transfer _ Murabahah / BBA (bay’ bi thaman al-ajil) 3
2.2. Forward Sale _Istisna’ / Salam Mode 6
2.3. Leasing and Hire Purchase Mode (ijarah thumma Bay’) 8 2.3.1. Build, Lease, and Transfer (Ijarah Thumma Tamlik) 9 2.3.2. Build Sale and leaseback (Mersad) 11
3. Institutional financing: Joint ventures 12
3.1. Mudarabah 13
3.2. Partnership (Musharakah) 15
4. Corporate financing: Securitization of project (saham and sukuk) 18
4.1. Public issue: equity participation 18 4.1.1. Mudarabah Equity 20 4.1.2. Musharakah equity 20
4.2. Islamic bonds (Sukuk) 21 4.2.1. Muqradah or mudarabah bonds 22 4.2.2. Ijarah bonds 22
5. Self-Finance 23
5.1. Land as capital 23
5.2. Lump sum rentals obtain through Long lease (Hikr) 24
5.3. Substitution (ibdal and istibdal) of Waqf 24
5.4. Waqf shares 27
5.5. Cash and usufruct waqfs 27
6. Conclusion 28
Innovative Modes of Financing the Development of Waqf Property
By
Dr. Mohammad Tahir Sabit Haji Mohammad
Department of Land Administration and Development,
Faculty of Geoinformation Sciences and Engineering
University Technology Malaysia
1. Introduction
This paper is based on the presumption that the institutions of waqf (e.g. Majlis Agama Islam) are avoiding dependence on funding from Government, by seeking development financing from private sector. Also it is thought that the waqf institutions are not exposing their assets to liabilities arising from a particular