Axis REIT acquires RM30 million property in Johor

KUALA LUMPUR: Axis Real Estate Investment Trust (Axis REIT) will acquire a leasehold industrial property within Johor's Port of Tanjung Pelepas enclave from Zone Capacity Sdn Bhd for RM30 million.

In a statement to the exchange on Tuesday, April 20, Axis REIT said the property comprises a 6.12 acre site which accommodates a 1-storey warehouse and 2-storey office.

The property, located next to Nusajaya, is 10 minutes away from the Second Lnk to Singapore and comes with a long lease by Japan-based Nippon Express, a logistics firm,

"The proposed acquisition of the property will at the same time diversify and enlarge Axis REIT's portfolio of properties and is expected to benefit the fund in the long term from economies of scale," the property trust said.

Axis REIT's portfolio comprises 23 properties including commercial and industrial entities in Malaysia.

In a separate statement, Stewart LaBrooy, chief executive officer and executive director of Axis REIT Managers Bhd, the manager of Axis REIT, said the acquisition of the industrial property came with a capital gain in valuation of RM500,000 and a starting triple net yield of 9.2%.

"The acquisition will be yield accretive to the trust," LaBrooy said. Acquisition of the fully-tenanted industrial real estate will be financed entirely in cash.

In a separate announcement the bourse, Axis REIT said its net profit was up 37 % to RM14.27 million in the first quarter ended March this year, from RM10.42 million a year earlier, as the company booked higher rental income, and surplus from the revaluation of its properties. Revenue rose 14.5 % to RM19.85 million from RM17.33 million

"The manager is optimistic that in view of the current satisfactory performance of Axis REIT’s existing investment portfolio and its growth strategy to actively pursue quality acquisitions, it will be able to maintain its current performance for the coming quarter and the rest of the financial year ending Dec 31, 2010," Axis REIT said.