KUALA LUMPUR: Am Ara Reit Managers Sdn Bhd, the manager of AmFirst real estate investment trust (AmFirst REIT), has entered into a sale and purchase agreement for the sale of AmBank Group Leadership Centre for RM36mil cash.
The agreement was executed between Maybank Trustees Bhd, in its capacity as trustee of AmFirst REIT, and Techvance Properties Management Sdn Bhd.
Am Ara Rest said the sales price of RM36mil represented a premium of 57% to the property’s carrying value of RM22.9mil as at Sept 30, 2015 and was expected to result in a realised net gain of RM8.4mil.
The AmBank Group Leadership Centre is a 13-storey commercial building consisting of 52 car park bays, situated on Lorong P. Ramlee. The property is 25 years old with a net lettable area of 57,801 sq. ft.
“The divestment of the property provides an opportunity for AmFIRST REIT to realise its investment at an attractive price. This move is also consistent with AmFIRST REIT’s active asset management strategy to continuously evaluate its assets within the portfolio.” AmFirst REIT executive director/CEO Wong Khim Chon said.
The realised net gain from the agreement will be distributed as income distribution and the balance net proceeds will be used to pare down existing debt to create additional headroom for future potential acquisitions and value enhancing investments.
Post divestment, AmFirst REIT’s gearing will decline to 37% from 38.3% as at Sept 30, 2015.
The divestment is expected to be completed by fourth quarter of financial year ending March 31, 2016.
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