KUALA LUMPUR: I REIT Managers Sdn Bhd, the management company of AME Real Estate Investment Trust (AME REIT), aims to expand AME REIT’s portfolio beyond Johor into central and northern of Peninsular Malaysia by pursuing yield accretive asset acquisitions from third-party vendors.
This is in addition to AME REIT leveraging on the future property development projects of its sponsor, AME Elite Consortium Bhd (AME Elite), as a ready source for high-quality tenanted industrial properties, workers’ dormitories and warehouses for its acquisition.
Besides developing its existing projects in Johor, AME Elite is also actively seeking to develop industrial parks in central and northern Peninsular Malaysia, leading to AME REIT’s potential acquisition pipeline.
I REIT chairman and executive director Simon Lee Sai Boon said the key economic zones in Malaysia such as Selangor in the central region, Johor in the southern region and Penang in the northern region often attract local and foreign direct investments.
"The mandate to acquire third-party properties beyond Johor provides AME REIT with the flexibility and opportunity to expand the reach of our property trust to generate stable cash flows and potential long-term income and capital growth.
"On top of that, we would be able to ride on our sponsor’s established branding and intention to replicate their managed industrial parks concept in the central and northern region in the peninsula,” he said at the launch of AME REIT’s prospectus today in conjunction with its initial public offering (IPO) on the Main Market of Bursa Malaysia.
Lee said, internally, I REIT's proactive asset management strategies, which focus on optimising and maintaining high occupancy rates, aim to achieve stable rental growth and maximise investment returns.
"The prospects for industrial and industrial-related properties remain positive with resilient demand, supported by growth in the electrical and electronics as well as logistics and e- commerce sectors. Hence, we are optimistic of AME REIT’s future outlook,” he added.
AME REIT has an initial portfolio of 34 industrial and industrial-related properties in Iskandar Malaysia, Johor, valued at RM557.0 million.
These industrial properties and dormitories are fully tenanted as at June 15 and July 15, 2022, respectively, thus providing visible and stable cash flows.
AME REIT’s IPO entails an offer of 254.8 million units at a retail price of RM1.15 per unit, representing 49.0 per cent of the total 520.0 million units. It is scheduled for listing on Sept 20, 2022.
The IPO comprises a retail offering of up to 174.8 million units, out of which up to 156.6 million units will be offered to shareholders of AME Elite on a one-for-five basis, 10.4 million units will be made available to the Malaysian public and 7.8 million units have been set aside for eligible directors and employees of AME Elite and its subsidiaries.
Meanwhile, at least 80 million units will be made available for selected institutional investors including approved Bumiputera investors.
Based on the retail price of RM1.15 per unit, the market capitalisation of AME REIT upon listing will be approximately RM598.0 million.
Hong Leong Investment Bank Bhd is the principal adviser and sole underwriter for AME REIT’s IPO exercise, and joint bookrunner together with RHB Investment Bank Bhd. - Bernama