Ibn ‘Umar reported: ‘Umar acquired a land at Khaibar. He came to Allah’s Messenger (Sall Allah-o-alaihe wa sallam) and sought his advice in regard to it. He said: “Allah’s Messenger (Sall Allah-o-alaihe wa sallam), I have acquired land in Khaibar. I have never acquired property more valuable for me than this, so what do you command me to do with it?” Thereupon he (Allah’s Apostle, Sall Allah-o-alaihe wa sallam) said: “If you like, you may keep the corpus intact and give its produce as sadaqa.” So ‘Umar gave it as sadaqa declaring that property must not be sold or inherited or given away as gift. And ‘Umar devoted it to the poor, to the nearest kin, and to the emancipation of slaves, and in the way of Allah and guests. There is no sin for one who administers it if he eats something from it in a reasonable manner, or if he feeds his friends and does not hoard up goods (for himself).

The above hadith set the precedent for the companion 0f the Prophet 9pbuh) and Muslims from all walks of life, over the centuries, to establish the waqf system for any shariah compliant purpose. This command of the Prophet (pbuh) and the action of ‘Umar set into motion the first Social Development Waqf by means of an income producing economic asset.