AEON Mall Kinta City lifts KIP REIT Q2 income

  • Property
  • Thursday, 17 Oct 2019

KUALA LUMPUR: KIP Real Estate Investment Trust (KIP REIT), the first community-centric retail REIT listed on Bursa Malaysia, said its income in the first quarter ended Sept 30 was boosted by a newly acquired property in Ipoh, Perak.

Net property income (NPI) rose 35.8% to RM13.5mil from a year ago on the back of a revenue growth of 18.6% to RM18.5mil, it said in a statement today.

Net profit shot up to RM18.5mil from RM7.3mil a year ago.

The manager of KIP REIT has declared an interim distribution per unit (DPU) of 1.37 sen. Based on today's closing price of 84.5 sen, the annualised DPU translated to a yield of about 7%.

“Through the first quarter, we are pleased with our progress towards achieving our target to enlarge the total asset under management to RM1.5bil within the next fivce years," KIP REIT Management Sdn Bhd managing director Datuk Chew Lak Seong said.

KIP REIT completed the acquisition of AEON Mall Kinta City, a four-storey building with a total net lettable area of 530,181 square feet, during the first quarter.

It said changes in fair value of investment property incidental to the AEON Mall Kinta City acquisition of RM13.2mil had boosted its profit, but partially offset by the one-off expenses of RM3.5mil related to the acquisition.

The acquisition is anticipated to further contribute to the full-year NPI.

"AEON Mall Kinta City has a gross yield of 8.3% with a lease until 2025 and an option to renew the lease for another 5 years, which will generate a stable income," Chew said.

"Further, the lease also has a rent escalation mechanism of 10% at renewal which will further boost our year on year growth accordingly," he added.

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