Axis-REIT to buy property for RM18.5m

Axis-REIT to buy property for RM18.5m

Email us your feedback at fd@bizedge.com


Axis Real Estate Investment Trust (Axis-REIT) is acquiring a single storey factory and warehouse with a double-storey office annexe from SKB Shutters Manufacturing Sdn Bhd (SKBSMSB) for RM18.5 million cash.

In a statement on April 20, Axis REIT Managers Bhd (ARMB), the manager of Axis-REIT, said the REIT's trustees, OSK Trustees had entered into a sales and purchase agreement with SKBSMSB to acquire the property.

Forming a rectangular shape, the four contiguous plots of freehold industrial land in Shah Alam are strategically located along Jalan SU 6A within Taman Perindustrian Subang (Lion Industrial Park) and have a total land area of 174,838.18 sq ft.

ARMB said the property was currently 100% tenanted, and occupied by Setia Corporation Sdn Bhd, which is involved providing transportation, forwarding and warehousing.

It said Setia Corporation’s tenancy was a two-year lease, with an option to renew for another two years when the lease expired in August 2008. The current monthly rental income for the property is RM126,500.

ARMB intended to utilise Axis–REIT’s existing credit facilities to fund the acquisition, which will increase its gearing ratio to 24.77% of audited total assets as at Dec 31, 2006, which is below the gearing limit of 50% as prescribed by the ‘Guidelines on Real Estate Investment Trusts’ issued by the Securities Commission.

It said the proposed acquisition was expected to be completed by the end of August 2007.