KUALA LUMPUR (April 12): Axis Real Investment Trust (REIT) is acquiring a logistics warehouse facility in Pelabuhan Tanjung Pelepas (PTP) in Johor for RM390 million cash, its largest acquisition to date.
In a statement, the REIT said it has inked a sale and purchase agreement (SPA) with Equalbase PTP Sdn Bhd (EPSB) to aquire the 1.55 mil sq ft property. EPSB is a unit of EQualbase Pte Ltd in Singapore and is in the business of developing and leasing warehouses.
The property is currently being used for warehousing and is occupied by EPSB’s customers, which includes two multi-national automotive corporations namely Al Futtaim RDC Malaysia Sdn Bhd and Kuehne + Nagel Sdn Bhd.
On completion of the purchase that is esxpected to happen around mid-2022, the property will be leased back to EPSB for a fixed term of 10 years, with a starting monthly rental of RM2.17 million for the first three years, with subsequent upward adjustments from the 4th until the 10th year.
The property, built about three years ago, is located on an 18.4-acre subleased land.
“This acquisition will be the largest to date since the establishment of the Fund and highlights Axis-REIT’s intent to grow with the acquisition of high-quality properties that are earnings accretive and with strong value propositions. The property, a modern ramp-up logistics facility and well equipped for logistics purposes, is located within the vicinity of PTP, Malaysia’s premier trans-shipment port. Furthermore, the property is a certified green building by GBI (Green Building Index) and the proposed acquisition signifies Axis-REIT’s commitment towards ESG and to generate sustainable income for the fund,” said Axis REIT Managers Bhd chief executive officer Leong Kit May.
Axis REIT plans to fund the purchase via bank financing, which it said will increase its gearing ratio to 37.2% of its audited total assets as at Dec 31, 2021. It expects the acquisition to be accretive to its distributable income.
The REIT's unit price closed one sen or 0.54%% lower at RM1.83 on Monday, valuing the trust at RM2.99 billion.
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