KUALA LUMPUR (Oct 15): Axis Real Estate Investment Trust (REIT) is planning to acquire a single-storey warehouse-cum-office building in Johor for RM65 million cash, from Rancak Beta Sdn Bhd.
In a filing with Bursa Malaysia today, Axis REIT said the proposed acquisition will be funded by its existing bank financing, and it will not assume any liability pursuant to the property.
Thus, the proposed debt financing will increase Axis REIT’s gearing ratio to 38.7% of audited total assets as at Dec 31, 2018, the REIT said.
The property, together with ancillary buildings, is presently built upon a portion of leasehold land, with an unexpired 35 years and five months sub-lease term, the REIT said.
The property is located within the Pelabuhan Tanjung Pelepas (PTP) Free Trade Zone, located approximately 18 km due to south-west of Johor Baru City Centre, 41km from Senai International Airport and approximately 40km from Port of Singapore Authority.
The Lessee, Schenker Logistics (M) Sdn Bhd, is a one-stop-logistics provider offering total integrated logistics services to local and global customers and is also one of Axis REIT’s existing top ten tenants in the portfolio in terms of revenue contribution to the fund.
On a land area of approximately 8.177 acres, the property has a net lettable area of 222,723.20 sqft.
Its net book value was at RM34.88 million as at June 30, 2018.
The proposed acquisition is only expected to contribute positively to its earnings upon its completion date, which is targeted to be by the first half of 2020, Axis REIT said.
Axis REIT’s unit price closed five sen or 2.72% lower at RM1.79 today, valuing the trust at RM2.22 billion.
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