Axis REIT to buy City‑Link distribution centre in Bandar Saujana Putra for RM128 mil

PETALING JAYA (June 26): Axis Real Estate Investment Trust (Axis‑REIT) is proposing to acquire a fully occupied distribution centre in Bandar Saujana Putra, Selangor, from courier and logistics player City‑Link Express (M) Sdn Bhd for RM128 million in cash.

Axis‑REIT said RHB Trustees Bhd, acting as trustee for the fund, entered into a sale and purchase agreement (SPA) with City‑Link yesterday.

According to a Bursa filing by the REIT, the property at No. 1, Jalan SP 1, Bandar Saujana Putra comprises two contiguous leasehold commercial parcels measuring a combined 46,776.11 sq m (about 11.56 acres) in Mukim Tanjong Duabelas, Kuala Langat.

It is improved with a single‑storey, one‑and‑a‑half‑storey and double‑storey distribution centre, two blocks of double‑storey office buildings and ancillary structures, with an estimated gross floor and lettable area of about 355,023 sq ft.

Axis‑REIT said the buildings are about 9 to 12 years old and currently 100% owner‑occupied by City‑Link.

Axis‑REIT said the total lump‑sum purchase price of RM128 million will be satisfied entirely in cash, free from encumbrances but subject to the terms and conditions of the SPA. The consideration is structured as a 2% earnest deposit of RM2.56 million, an 8% balance deposit of RM10.24 million, and a balance purchase price of RM115.2 million payable on completion.

The manager said the agreed price was derived from an independent valuation of RM129 million by Raine & Horne International Zaki + Partners Sdn Bhd, which adopted the investment method with the cost approach as a check.

Axis‑REIT added that it will not assume any liabilities of the vendor under the transaction, and that the property is presently charged to AmBank (M) Bhd and AmBank Islamic Bhd.

On completion, Axis‑REIT said the asset will be leased back to City‑Link under a 15‑year fixed‑term tenancy. The agreed monthly rental is RM661,878, subject to step‑ups over the lease term, providing the fund with recurring rental income from a single lessee engaged in courier and integrated logistics services.

Axis‑REIT intends to fund the proposed acquisition via bank borrowings from its existing credit lines. The manager said that, based on audited figures as at Dec 31, 2025, the financing ratio is expected to rise to about 33.94% of total assets after the deal, remaining below the 50% gearing limit set out in the Securities Commission’s Listed REIT Guidelines.

It added that the acquisition will not affect the number of units in issue or substantial unitholders’ stakes, and is not expected to have a material impact on net asset value at completion.

Axis‑REIT said the proposed acquisition is in line with its investment objective and growth strategy to acquire high‑quality, earnings‑accretive industrial and logistics assets with strong recurring income.

The manager said the transaction is expected to be accretive to the fund’s distributable income and to contribute positively to earnings for the financial year ending Dec 31, 2026 once completed, which is targeted by the fourth quarter of 2026.

The REIT manager highlighted that the distribution centre enjoys connectivity via the ELITE, SKVE, WCE and KESAS highways, which provide access to Shah Alam, Klang, Puchong, Putrajaya, Cyberjaya, Kuala Lumpur International Airport (KLIA) and Port Klang. Axis‑REIT said this highway network enhances the suitability of the property for logistics, warehousing and distribution activities.

Axis‑REIT said the SPA is conditional on, among others, state authority consent to transfer the land to the trustee and consent from the existing chargees, to be obtained within four months of the SPA or within an extended period agreed in the contract. If the conditions precedent are not fulfilled in the manner provided, the SPA may be terminated in accordance with its terms.

The manager also outlined standard default and termination provisions.

It said City‑Link may terminate the SPA if the trustee fails to pay the balance purchase price as stipulated, while the trustee may terminate if City‑Link commits a material breach or faces specified insolvency‑type events such as the appointment of a receiver, inability to pay debts when due, compromise with creditors, winding‑up proceedings, or ceasing a substantial portion of its business.

Axis‑REIT said none of the directors and major shareholder of the manager, nor major unitholders of the fund or persons connected to them, has any direct or indirect interest in the proposed acquisition.

The board of Axis REIT Managers Bhd stated that, after considering all aspects of the transaction, it is of the opinion that the proposed acquisition is in the best interest of Axis‑REIT.

The manager cautioned that the property remains subject to risks inherent in the property market, including non‑fulfilment of SPA conditions, potential compulsory acquisition by the government, non‑renewal of the lease at expiry, adverse changes in economic or local market conditions, the financial position of tenants, changes in laws and regulations, competition for tenants and force‑majeure‑type events.

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