Al-Salam REIT buys Mydin hypermarket in Terengganu

One of Mydin hypermarkets in Terengganu.

One of Mydin hypermarkets in Terengganu.

KUALA LUMPUR: Al-Salam Real Estate Investment Trust (REIT) is buying a Mydin double-storey hypermarket in Gong Badak, Kuala Terengganu, for RM155mil in cash.

Johor Corp’s unit Damansara REIT Managers Sdn Bhd, which manages the Islamic REIT, told Bursa Malaysia that AmanahRaya Trustees Bhd, acting on behalf of Al-Salam REIT, had on Monday inked a conditional agreement with Mydin Wholesale Cash and Carry Sdn Bhd to acquire Mydin Hypermarket Gong Badak.

The three-years-old hypermarket includes 796 car park bays (634 covered parking bays and 162 surface car parking bays).

On completion of the proposed acquisition, the property will be leased back to Mydin Mohamed Holdings Bhd for a period of 30 years with a 5% rent increment every two years.

Following the aquisition, Al-Salam REIT’s portfolio of investment properties will increase in value from RM922.1mil to RM1.077bil.

Damansara REIT Managers believes that the proposed purchase represented a good opportunity for Al-Salam REIT to expand its existing portfolio of investment properties that could provide a stable and sustainable income stream pursuant to the lease agreement.

The proposed acquisition is expected to be completed in the first quarter of 2018.

Al-Salam REIT, set up in March 2015, has a portfolio of properties ranging from Komtar Johor Baru City Centre to KFC/Pizza Hut restaurants.