KIP Real Estate Investment Trust has entered into an agreement to build with AEON Co. (M) Bhd for the expansion of AEON Kinta City Mall in Perak, as part of its asset enhancement initiative.
The real estate company said the proposed expansion will be undertaken on a parcel of freehold land measuring approximately 60,230 square metres in Kinta, Perak, where the existing three-storey AEON Kinta City Mall is located.
Under the agreement, KIP REIT will develop and construct an expansion to the existing mall at a total development cost of not more than RM160 million.
The proposed expansion will add a gross floor area of about 225,989.7 sq ft and a net lettable area of approximately 145,374.1 sq ft, along with 229 additional car park bays.
Construction is expected to take 17 months, including the time required to obtain the Certificate of Completion and Compliance. The timeline may be extended by one month subject to prior notice and mutual agreement between both parties.
The estimated development cost represents 10.1% of KIP REIT’s total asset value as at June 30, 2025, triggering the announcement requirement under the listing rules.
AEON, which is currently leasing the existing mall under a five-year lease expiring on Sept 28, 2030, has agreed to lease the expanded area upon completion.
The expanded space will be tenanted from its business commencement date until Sept 29, 2030, at an annual rent equivalent to 8% of the actual development cost incurred.
Following the expiry of both the existing lease and the expanded tenancy, AEON will lease the entire premises — comprising both the existing building and the expanded area — for an initial term of three consecutive five-year periods, with an option to renew for a further two five-year terms.
