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Friday, January 2, 2009

EPF may bid for Menara Citibank

The Employees Provident Fund (EPF) may bid for Menara Citibank, a prominent building in the heart of Kuala Lumpur, as it feels that now is the time to increase its property collection.

"We are enquiring ... I can consider (bidding)," Johari Abdul Muid, deputy chief executive officer of investment, told Business Times and Berita Harian in an interview recently.

Menara Citibank, a 50-storey building that is almost fully occupied, is up for sale again after IOI Corp Bhd called off its purchase that was priced at RM586.73 million.

IOI backed out of the deal in November, forfeiting its RM73.36 million deposit paid to Inverfin Sdn Bhd, citing concern over the economy.

Inverfin is 50 per cent owned by Menara Citi Holding Co Sdn Bhd, a unit of US bank Citigroup. Singapore's CapitaLand Ltd holds another 30 per cent, while Amsteel Corp Bhd owns the rest.
"When it comes to buildings, we have a clear-cut policy to deal with more prominent ones," Johari said.

In May, the pension fund bought the 26 Boulevard building in Precinct 3, Putrajaya, from Putrajaya Holdings Sdn Bhd. More than 90 per cent of the office and retail space in the building has been taken up by government departments and companies.

EPF invested RM1.78 billion in real estate in 2007, or just 0.6 per cent of its total investments. Its portfolio includes properties such as the Sogo shopping mall, Wisma KFC and a building in KL Sentral.

Menara Citibank has a net lettable area of 733,626 sq ft and 99 per cent occupancy rate.

The net book value of the building as of December 31 2007 is RM458 million and the gross rental revenue is RM43.3 million (excluding revenue from the car park of RM3.3 million).

By Business Times (by Shahriman Johari)

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