Sentral REIT expects Klang Valley office rental rate, occupancy level downward pressure to continue in FY22

KUALA LUMPUR (April 7): Sentral Real Estate Investment Trust (REIT) expects the rental rates and occupancy levels of Klang Valley office buildings to continue experiencing downward pressure in the financial year ending Dec 31, 2022 (FY22) due to the current excess supply and expected increase in supply.

However, Sentral REIT, formerly MRCB-Quill REIT, said it is optimistic that the economic recovery this year would impact the office space market positively.

“The manager believes that Sentral REIT will be able to surpass these market challenges as it continues to intensify efforts to sustain revenue underpinned by its continuing strategies,” it said in a filing with Bursa Malaysia on Wednesday.

Among its strategies are prudent capital management, proactive management to drive organic growth, prudent investments to deliver growth and diversification.

“Sentral REIT is able to consider all types of commercial properties in the event that there are opportunities to diversify in the future,” it said.

In FY21, Sentral REIT had a portfolio of nine commercial properties in the country valued at RM2.08 billion with 66% renewal rate.

In terms of valuation, properties in the Klang Valley made up 77% of  Sentral REIT’s total portfolio value followed by Cyberjaya wth 16% and Penang with 7%.

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