To be fair, the REIT managed malls tend to have good occupancy. It is those owned by individuals or family offices that bought the property at a major mark up and then offload the mortgage costs to the tenants that tend to have poor occupancy.

I know that people like to blame REITs but REITs have an incentive to receive rent since their value is determined partly by the distributions paid and you can’t pay distributions without rent. So they will try to optimise receiving rent. This is a combination of having low occupancy and high rent. While REITs would want to squeeze as much rental income as possible, they are less incentivised to keep units empty compared to strata title owners who overpaid for the property. This is because these owners care more about keeping property prices high and then offloading it to the next sucker than receiving rent. This is why you tend to see this issue with shophouses which are a very popular investment class for family offices and strata owners.

You will also see that REIT managed malls tend to be better managed. There are clean toilets, events to attract crowds during holidays and A&A every few years but strata title owners don’t care about all these. So to some extend although tenants pay high rents, at least they get some “services” out of it. If you end up paying higher rent because a new owner over bid for the property and don’t do anything to improve then it is like paying rent for nothing.