Axis REIT targets AUM growth to exceed 10% for 2017

KUALA LUMPUR (Jan 19): Axis Real Estate Investment Trust (REIT) said it expects its total assets under management (AUM) to grow by more than 10% for its financial year ending Dec 31, 2017, contributed by the completion of Phase 1 of Axis PDI Centre and a few more acquisitions the trust is eyeing.

At a media briefing today, Axis REIT Managers Bhd chief executive director Leong Kit May said the REIT’s AUM stood at RM2.19 billion as at end-FY2016, with the completion of the first phase of Axis PDI Centre to increase its AUM to approximately RM2.4 billion.

“Last year, there was a consultation paper to allow REITs to go into development, but that is yet to be gazetted. However, this project has already been granted a special exemption by the SC (Securities Commission Malaysia) for us to proceed with works,” said Leong.

She explained that the exemption granted is only for the first phase of the project — which will be leased to Nestle (M) Bhd upon completion by end-2017 and handed over in early-2018.

Meanwhile, the second phase of the Axis PDI Centre land is being rented out as a vehicle storage yard.

“Currently, half of the site is seeing some active construction works, while the other half is being rented out as the vehicle storage yard. So Phase 2 of the land is currently generating car park income for the REIT, while Phase 1 is undertaking its full 12-month construction.

“We are very excited with this development, because the moment Phase 1 is completed, it will increase our total AUM to RM2.4 billion,” she explained.

Meanwhile, the plans for Axis PDI Centre, the REIT could see its total asset value further increasing, as Axis REIT Managers head of investments Siva Shanker said the fund is targeting to complete the acquisition of Kerry Warehouse in Pasir Gudang, Johor, within the first quarter of 2017.

He said Axis REIT is also targeting to acquire four more assets in Selangor, Pahang and Johor, with a combined asset value of RM400 million.

“We are also chasing some other acquisitions currently, which are under various stages of negotiations, including an industrial facility in Section 51, Petaling Jaya; a very large logistics facility in Sepang; an industrial facility in Kuantan, Pahang; and a another industrial facility in Nusajaya Johor.

“These four properties total roughly about RM400 million and we are in negotiations with the vendors. But of course, some of these will come through and some won’t. There are also other investments we are eyeing, but those are still in the early stages,” he said. —

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