KUALA LUMPUR (Oct 25): Axis Real Estate Investment Trust (REIT) is acquiring industrial premises in Negeri Sembilan for a cash consideration of RM48 million.
The vendors of this transaction are BSS Development Sdn Bhd and Matrix IBS Sdn Bhd. Both companies are wholly owned subsidiaries of Matrix Concepts Holdings Bhd.
The property is situated within an established industrial development known as the Sendayan Techvalley Industrial Park.
The property has a net lettable area of 105,311 sq ft, and comprises a single-storey detached factory, a single-storey detached office, a double-storey detached office, a single-storey canteen building, and other ancillary structures.
The property is currently leased to an international company that manufactures machinery for mining, quarrying and construction. The leasing term is six years, commencing from March 1, 2023, with an option to renew for four further terms of three years.
The current monthly rental fee is RM250,000, and will be increased by 8% for the period between March 1, 2026 and Feb 28, 2029.
The acquisition will be funded by existing bank financing, which will increase Axis REIT’s financing ratio to 37.04% of the audited total assets as at Dec 31, 2022, which is still below the gearing limit of 50%, as prescribed by the Guidelines on Listed Real Estate Investment Trusts issued by the Securities Commission Malaysia.
The acquisition is expected to be completed by the first half of 2024.
Commenting on the acquisition, Axis REIT Managers Bhd chief executive officer and executive director Leong Kit May said the proposed acquisition checks all its investment objective boxes of high-quality accretive properties with strong recurring rental income.
“The long lease of approximately six years will improve its portfolio’s weighted average lease expiry,” she added.
Axis REIT units finished one sen or 0.55% lower at RM1.80, giving the REIT a market capitalisation of RM3.13 billion.
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