Axis Reit To Make Its Single Largest Acquisition For RM390 Million

Axis Real Estate Investment Trust’s trustee, RHB Trustees Berhad entered into a sale and purchase agreement to acquire a 1,548,982 sq. ft. logistics warehouse facility in Pelabuhan Tanjung Pelepas, Johor from Equalbase PTP Sdn. Bhd. making it the single largest acquisition RM390 million.

Upon the completion of the proposed acquisition, expected to be by mid-2022, Axis says the property will be leased back to EPSB for a fixed term of 10 years. The starting monthly rental will be RM2.17 million for the first three years with subsequent upward adjustments at the start of year 4 until year 10.

EPSB is a subsidiary of Equalbase Pte. Ltd. Singapore and is in the business of developing and leasing warehouses to its customers. The facility houses 4 EPSB’s customers which include two multi-national automotive corporations.

The property was built approximately 3 years ago and is situated on an 18.4-acre subleased land. It comprises a double-storey ramp-up warehouse cum 3-storey office, sheltered car park, and office together with ancillary buildings. The property is suited for warehousing purposes as it comes with 83 loading bays equipped with hydraulic dock levellers and early suppression fast response (“ESFR”) sprinklers system. Based on the valuation report by First Pacific Valuers Property Consultants the market value of the property is RM390 million.

The warehouse is located within the PTP Free Trade Zone and within close proximity to the Tuas checkpoint in Singapore and is also a green building as certified by Green Building Index in line with Axis-REIT’s environmental, social and governance goals and strategies.

The proposed acquisition will be funded by bank financing, increasing Axis-REIT’s gearing ratio to 37.2% of its audited total assets as at 31 December 2021.

Commenting on the proposed acquisition, Chief Executive Officer/ Executive Director Leong Kit May said, “This (proposed) acquisition will be the largest to date since the establishment of the Fund and highlights Axis-REIT’s intent to grow with the acquisition of high-quality properties that are earnings accretive and with strong value propositions. ”

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