KWAP buys Menara AIA Cap Square from Germany's UIRE

KUALA LUMPUR: The Kumpulan Wang Persaraan (KWAP) bought the Menara AIA Cap Square from Germany’s Union Investment Real Estate GmbH (UIRE).
 
JLL Malaysia, which advised UIRE on the deal, said on Friday the 41-storey Grade A office building comprises 601,796 square feet of net lettable space. Current tenants include insurance and financial companies such as AIA and Citibank.

This was the the largest office building sale in Malaysia in 2016, according to JLL Malaysia. However, the amount transacted was not disclosed.

“We’re delighted with this result for both the buyer and the seller,”  said JLL Malaysia managing director YY Lau. 

“This is a high profile property in a desirable location with an enviable occupancy rate and top quality tenants. 

"With this purchase, KWAP is demonstrating its confidence in the Kuala Lumpur office market and we expect there will be increased interest in other Grade A office properties as a result, from both domestic and international investors.”

KWAP, which is Malaysia’s second largest pension fund, had earlier this year, sold its 18-storey office building, 88 Wood Street in the City of London, for US$345mil, which it bought in 2013 for US$275mil. 

Since then, the fund has been looking for investment opportunities in Malaysia and particularly in the capital. 

Menara AIA Cap Square will be the second property KWAP owns in Kuala Lumpur, having purchased the 39-storey office block Integra Tower for RM1.06billion (US$315mil) in April 2015.

JLL Malaysia associate director Nick Charlton said this sale reflected investors' confidence in Kuala Lumpur’s strong fundamentals in the short and medium term as Malaysia’s prime office investment location and that “it remains competitive on a regional basis for attractive rental growth and returns”.

This high profile office deal follows on from the sale of Singapore’s Asia Square Tower 1, a world-class commercial development in the city’s Marina Bay business and financial district. 

JLL brokered the sale to Qatar Investment Authority on behalf of seller BlackRock in June 2016.

In 2015, JLL was named number one real estate investment advisory firm in Asia Pacific for the fifth year in a row by Real Capital Analytics (RCA), an independent body that monitors real estate transaction volumes worldwide