News

Sunway REIT To Buy Land In Penang For RM17.2 Mln

Last update: 20/06/2016

KUALA LUMPUR, June 20 (Bernama) -- Sunway Real Estate Investment Trust (Sunway REIT) has entered into a sale and purchase agreement with Commercial Parade Sdn Bhd, a subsidiary of Sunway Bhd, to acquire a parcel of leasehold land in Seberang Perai Tengah, Penang for RM17.20 million.



Sunway REIT in a filing to Bursa Malaysia Monday said the proposed acquisition would be fully funded through its existing debt financing.



It said the land, which is located adjacent to its Sunway Carnival Shopping Mall, would facilitate plans to increase the net lettable area of the mall with the construction of an extension of the existing mall.



The planned extension comprised a nine-storey shopping mall inclusive of six-storey parking bay above the retail space and one-storey basement parking.



Sunway REIT said the extension would enhance its future earnings by allowing the REIT manager to meet larger retail space requirement sought after by international and regional retailers.



It said the extension would also allow it to enhance its tenant mix and reduce the impact of economic cycles on overall rental income and to continually meet discerning lifestyle of shoppers.



It will also allow the trust to stay ahead of competition and stay relevant to the consumer preference and the ever-evolving market trends.



The proposed acquisition was expected to create value for its unitholders in the long run given its proven track record, it added.



Meanwhile, Sunway Bhd in a separate filing said the disposal of the land would allow Commercial Parade to unlock the value of the land and allow the expansion of Sunway Carnival.



It added that Commercial Parade planned to utilise the land sale proceeds to redeem its non-cumulative redeemable preference shares amounting to RM9.3 million and to repay its shareholders via dividend.



-- BERNAMA