KUALA LUMPUR: Real estate investment trust Axis-REIT is planning to acquire RM260 million worth of new properties to expand its investment portfolio.
"We are currently in acquisition mode and are looking to purchase RM260 million worth of properties so we are raising the funds to do that," said CEO Stewart LaBrooy.
The properties for acquisitions include logistics warehouses in Bayan Lepas, Seberang Prai, Shah Alam, Pelabuhan Tanjung Pelepas and Johor which would generate 8.3% to 10.5% yield for the company.
To finance the acquisitions, Axis-REIT is expected to raise RM170 million via placement of 75.18 million new units, while the balance of RM90 million will come from borrowings. Axis-REIT has been expanding its portfolio size by 20% a year through the acquisition of five to six properties a year.
"We will maintain our performance and work on improving it. It all depends on how soon we can bring in assets on to book new ones. That always helps to improve on the earnings. Its still a difficult market," LaBrooy told the media at financial result briefing yesterday.
The company recently released its earnings for 2QFY11ending June 30. Its trust revenue rose to RM28 million, a 34% increase from RM21 million in the previous corresponding quarter. Its profit for the period was RM15.9 million compared with RM22 million previously. For the six months ended June 30, Axis-REIT had a total property income of RM55.6 million with total expenditure of RM8.16 million.
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