KUALA LUMPUR: Hektar Real Estate Investment Trust
(Hektar REIT) has proposed to acquire the leasehold interest in 2.43 hectares in Setapak, Kuala Lumpur, together with a private school known as KYS KL East International School (KYSKLEIS) on it, for a purchase consideration of RM125 million.
MTrustee Bhd, acting on behalf of Hektar REIT, has inked a conditional agreement with KYS College Sdn Bhd (KCSB) for the proposed deal.
The purchase consideration will be satisfied via a cash payment of RM106.55 million and the issuance of units in Hektar REIT to the vendor, according to the filing with Bursa Malaysia today.
Hektar REIT said KCSB has a 30-year ground lease on the land starting from March 1, 2016, and expiring on Feb 28, 2046, pursuant to a master lease agreement (MLA) entered into between it and Sime Darby Property (KL East) Sdn Bhd (the lessor).
The proposed acquisition and lease is subject to, among others, the extension of the MLA lease tenure to 99 years via a supplemental MLA to be entered into with the lessor, as well as the completion of a secondary school building by KCSB within a stipulated timeframe, it said.
There are currently a pre-school building and a primary school building on the 2.43 hectares, which forms part of the 3.84-hectare freehold land owned by Sime Darby Property (KL East).
Hektar REIT said it will subsequently grant a sub-lease over the land and buildings to KCSB to continue operating KYSKLEIS.
"The proposed acquisition and lease entailing the sale and leaseback arrangement of KYSKLEIS will be backed by the long-term lease arrangement of up to 99 years, which will provide Hektar REIT with fixed and contractually secured rental income from the sub-lessee,” it said.
Hektar REIT said that, barring any unforeseen circumstances, the proposed acquisition and lease is expected to be completed in the first quarter of 2027.
UOB Kay Hian (M) Sdn Bhd has been appointed as the principal adviser for the proposed acquisition and lease. - Bernama
