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Thursday, August 26, 2010

ARMB eyes RM200m commercial assets

AXIS REIT Managers Bhd (ARMB) plans to buy a cluster of commercial assets worth more than RM200 million in Petaling Jaya and Shah Alam to expand its portfolio.

Chief executive officer Stewart LaBrooy said it will place out about 20 per cent of its current fund size to raise up to RM160 million for the acquisitions.

"If we leverage that up, we can buy over RM200 million new assets," he told Business Times yesterday after its shareholders meeting in Kuala Lumpur.

ARMB, the manager of the world's first office/industrial Islamic real estate investment trust (REIT), now manages 27 properties with more than 4.5 million sq ft of space worth RM1.2 billion.

The properties range from offices and warehouses to logistic centres and hypermarkets.

LaBrooy had said in July that ARMB is targeting to manage RM1.6 billion worth of assets.

Its latest deal is to buy Tesco hypermarket in Johor, Axis Technology Centre in Petaling Jaya and Axis PDI Centre in Klang worth RM200 million.

ARMB is also buying a logistics warehouse in Port of Tanjung Pelepas in Johor, Axis Techpoint 1 in Petaling Jaya and an office building in Cyberjaya. The acquisitions worth a combined RM190 million will be completed by early next year.

"There is pent-up demand for office space in Selangor. People are moving from Kuala Lumpur due to traffic congestion and high rentals," he said

LaBrooy said ARMB plans to refurbish three of its existing properties over the next two years for RM2 million to RM5 million each to raise rentals.

The properties are Kayangan Depot in Shah Alam, Crystal Plaza and Infinite Centre in Petaling Jaya.

On REIT, LaBrooy said the market was doing better, compared with 12 months ago, attributed by the strengthening of the ringgit and the equity market.

"It has come back on the radar. We are far more liquid now. The market has outperformed the industry. Government-linked companies are performing well and that augurs well for the country and with that comes a lot of opportunities," he said.

By Business Times

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