YTL Hospitality Real Estate Investment Trust (YTL REIT) is acquiring Syeun Hotel, a leasehold land measuring 4,539 sq m in Ipoh, as well as related assets from Syeun Hotel Bhd for a total cash consideration of RM55 million.
“The property will be renovated and proposed to re-open under the AC Hotels by Marriott brand,” it said in a Bursa filing today (Feb 7).
Pintar Projek Sdn Bhd, as the Manager for YTL REIT announced that the REIT’s trustee, Maybank Trustees Berhad, entered sale and purchase agreement (SPA) with Syeun Hotel Bhd for the acquisition of the said property.
The REIT manager said that the property include a parcel of leasehold land, on a 999-year leasehold interest expiring on 21 September 2894.
“Part of the land measuring a 48.3 sq (520 sq ft) has been eased to Tenaga Nasional Berhad for 30 years commencing from 15 February 1994 to 14 February 2024.”
The REIT is also acquiring the hotel building erected on the land, Syeun Hotel, and all its assets such as plant, operating equipment, furniture, fixtures and fittings.
The hotel is 29-year-old, 13-storey standalone hotel building with 290 rooms which was previously operated as Syeun Hotel. It was categorized as a ‘4-star’ hotel, which has ceased operations in May 2020.
The purchase consideration was arrived at on a ‘willing-buyer willing-seller’ basis after taking into consideration the market value of the property of RM58 million, as ascribed by the independent valuer.
The acquisition will be funded by borrowing and/or internally generated funds, comprising of RM10,000 deposit and the balance of purchase consideration of RM54,990,000.
The REIT manager said the proposed acquisition is in line with the investment objective of YTL REIT to continuously pursue the strategy to acquire and invest in high quality hospitality properties in Malaysia and internationally.
“The property is located with Ipoh city centre which will augment YTL REIT’s Malaysian portfolio with its strategic location in Ipoh. It has good all-around accessibility and facilitated by the existing major transportation networks.
“Other prominent landmarks within the vicinity include Ipoh Parade, Ipoh Convention Centre, KPJ Ipoh Specialist Hospital, UTC Perak and The Majestic Imperial Tower Ipoh to name a few,” it said.
It said as the property will be renovated and proposed to re-open under the AC Hotels by Marriott brand, it believes that it will create value for YTL REIT.
“The property will be leased under a variable rental arrangement where YTL REIT will participate in the income to be generated from the property.
“In view of the strategic location and accessibility, we believe that the prospects of the property are positive which is expected to provide growing income stream from the lease of the property under a variable rental arrangement and enhance the financial performance of YTL REIT and its subsidiaries,” it added.
Barring any unforeseen circumstances, the proposed acquisition is expected to be completed during the first half of 2024.
