The REIT plans to convert the property into a temperature-controlled distribution center.

CapitaLand Malaysia REIT (CMRM) announced that the trustee of CapitaLand Malaysia Trust (CLMT) has entered into a sale and purchase agreement to acquire a freehold logistics warehouse at Shah Alam, Selangor for MYR38.7m (approximately $11.4m).

The warehouse is located at the HicomGlenmarie Industrial Park. It is a single-storey detached warehouse with an annexed three-storey office building, and a built-up area of 84,755 square feet.

CMRM also shared plans to convert the property into a temperature-controlled distribution center. It is estimated to cost the REIT RM14.6m. This would mean that CLMT’s total investment for the property is RM54.3m.

The acquisition and conversion of the warehouse will be fully funded by bank borrowings, CapitaLand Malaysia REIT said.

CMRM further shared that it has also executed a letter of offer with a reputable international luxury fashion retailer to fully lease the building for 10 years. The new lease is expected to commence in H1 2024 and generate a gross rental income of MYR3.5m per annum with an approximate yield of 6.5%.

The acquisition is expected to be completed in H2 2023.