GREAT Eastern Life Assurance (M) Bhd, in a bid to diversify its investment portfolio and ensure good returns to policyholders, will focus strongly on investing in commercial properties, especially in the Klang Valley.
Executive vice-president for finance and corporate affairs Bruce Lee said the company's property portfolio was currently worth RM700mil to RM800mil and was growing rapidly.
“We are always on the lookout for properties that have good investment potential to strengthen our property portfolio. Preference will be given to commercial office buildings in the Klang Valley,” he said in an interview with StarBiz.
“Great Eastern will acquire buildings that will provide it with capital appreciation as well as steady and consistent rental income stream''.
Lee said the company would take into account the price of the building and the quality of tenants before purchasing it.
Upon acquisition, he added, Great Eastern would, if necessary, refurbish and retrofit the building to ensure it gets better rentals and draw quality tenants, hence unlocking the potential of the property and improving investment yield.
He said the company decided to invest in properties because the yield in the long run was higher than other financial instruments like bonds and syndicated loans.
Furthermore, such instruments were also highly competitive and were invested by other financial institutions.
Great Eastern currently has some pockets of land banks scattered in the Klang Valley. Lee said it was also open to acquiring commercial buildings with adjoining retail malls, as this would provide synergy to its other shopping malls.
The two shopping malls owned by the company now are Great Eastern Mall and The Weld. On the latest developments of The Weld, he added, the retail podium was currently undergoing refurbishment and major revamps.
Great Eastern, which acquired Menara Weld from Cycle & Carriage Malaysia for RM150mil in 2003, expects the shopping mall to be opened to the public by year-end.
The Weld has six levels of retail floors and adjoining it is Menara Weld, a 26-storey office tower.
“We have done a major revamp of the retail podium and not just some mere cosmetic changes. The company has invested RM10mil to RM20mil for the revamp and refurbishment of the retail podium.
“The Weld will not be competing with other bigger shopping complexes like KLCC or Bukit Bintang.
“Our target customers are those living and working in the vicinity of Jalan Raja Chulan, Jalan P. Ramlee and Bukit Ceylon,'' he noted.
An artist impression of the refurbished and revamped Weld shopping mall in Jaln Raja Chulan
The retail podium has a net lettable area of 130,000 sq ft with 61 retail lots. The occupancy rate of The Weld currently was more than 50%. Lee said by the time it is opened, the company expects its occupancy to increase to about 75%.