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Wednesday, January 16, 2008

Quill Capita plans to buy three assets

This will increase the property trust's portfolio to RM 643mil

KUALA LUMPUR: Quill Capita Management Sdn Bhd (QCM), the manager of Quill Capita Trust (QCT), has proposed to acquire three assets for RM94.5mil.

According to QCM chief executive officer Chan Say Yeong, QCT targets to increase its property portfolio to RM750mil by end-2008 from RM549mil as at Dec 31, 2007.

“QCT's asset size will increase to RM643mil upon completion of the three proposed acquisitions in April and we are aiming for two more assets before year-end,” he said.

Chan said this after announcing QCT's results for the year ended Dec 31, 2007 (FY07).

He added that the company was in negotiations with a few third parties but declined further comment.

The properties to be injected will be acquired from the Quill group, one of the two main sponsors of the property trust along with CapitaLand group.

“The properties are the five-storey IBM regional processing and call centre in Cyberjaya, three-storey DHL logistics centre and office at Shah Alam, and four-storey HSBC Bank processing centre in Section 13, Petaling Jaya,” Chan said.

He added that the initial net property yield would be 6.3% per annum for these fully occupied assets.

These acquisitions were expected to be financed by internal funds and borrowings, Chan said.

Meanwhile, QCT surpassed its initial public offering (IPO) forecast distributable income of RM14.32mil by 34.5% to RM19.26mil for FY07.

“The main contribution to the increase in distributable income is the rental income of Wisma Technip and the commercial units of Plaza Mont'Kiara, which were acquired by QCT during the financial year, and lower interest expense,” Chan said.

According to Chan, the distributable income of RM19.26mil translates into a distribution per unit (DPU) of 6.46 sen, which is 7.7% above the IPO forecast of 6 sen.

He projects a DPU of 6.93 sen for end-2008.

“An interim DPU of 3.99 sen was paid in September 2007 while the remaining 2.47 sen is expected to be paid next month,” he said.

He added that QCT's policy was to pay out all its distributable income but it intended to retain 10% in 2009.

On the property outlook in Malaysia, Chan said the KL office market was expected to improve due to strong demand from business expansion, coupled with tight supply of quality office spaces.

By The Star

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