Axis Real Estate Investment Trust’s trustee, RHB Trustees Berhad has entered into a sale and purchase agreement to acquire an industrial facility presently built upon a 268,581 sq. ft. freehold land in Klang, Selangor from Jemaramas Jaya Sdn. Bhd. for a cash consideration of RM41.0 million.
The said industrial facility comprises a 3-storey annexed office building and 2 warehouses with a total gross floor area of 193,015 sq. ft. Situated within the industrial area of Meru which is a highly established industrial zone in Selangor, this location is well-connected via several major highways such as the New Klang Valley Expressway and New North Klang Straits Bypass. Also, it is only 50 kilometres south-west of Kuala Lumpur city centre.
The proposed acquisition is targeted to be completed by the fourth quarter of 2022. Upon completion of the acquisition, the said facility will be leased back to Jemaramas Jaya Sdn. Bhd. for 3 years. Wholly owned by Versalink Holdings Limited, a company listed on the Catalist board of the Singapore Exchange; Jemaramas Jaya Sdn. Bhd. is in the business of manufacturing, marketing, and selling systems furniture.
The acquisition consideration is based on the market value of RM41 million, as appraised by independent registered valuer, CBRE WTW Valuation & Advisory Sdn. Bhd., in its valuation report dated 25 August 2022. Axis said the RM41 million acquisition consideration will be funded by existing bank financing. Accordingly, this will increase its financing ratio to 31.59% which is still below the gearing limit of 50% prescribed by the Guidelines on Listed Real Estate Investment Trusts issued by the Securities Commission Malaysia.
The acquisition is in line with its investment objectives and growth strategy to provide its unitholders with stable income distribution and to achieve growth in the net asset value.