PETALING JAYA: Axis Real Estate Investment Trust
(Axis-REIT) has entered into a sale and purchase agreement with WH Union Development Sdn Bhd to acquire a fully occupied industrial complex located in Kawasan Industri Padang Meha, Kedah, for RM113mil in cash.
Situated on about 13.28 acres of freehold land, the industrial complex (comprising six premises) has a lettable area of 340,047 sq ft.
Upon completion of the proposed acquisition, targeted for the first quarter of 2027, WH Union will be the master lessee of the property under a six-year leaseback arrangement.
The leaseback arrangement is expected to provide Axis-REIT with an initial monthly rental income of RM620,452.80, subject to an agreed rental step-up during the second lease term as per the lease agreement.
Axis-REIT said the proposed acquisition will be funded through the group’s existing bank facilities and is expected to increase its financing ratio to about 33.76% of audited total assets as at Dec 31, 2025.
The company said this proposed acquisition, together with the four sale and purchase agreements which have been executed by Axis-REIT but are pending completion, for a combined purchase consideration of RM280.6mil, is expected to be completed by 2027.
WH Union is in the business of buying, selling, renting and operating of self-owned or leased real estate – non-residential buildings.
In a filing with Bursa Malaysia, Axis-REIT said the proposed acquisition of the property is in line with the fund’s investment objectives and its growth strategy to provide the unitholders with stable income distribution and to achieve growth in the net asset value per unit of Axis-REIT by acquiring high-quality, earnings-accretive properties with strong recurring rental income.
Axis-REIT Managers Bhd chief executive officer/executive director Leong Kit May said the property benefits from the established industrial network in Kulim, particularly in manufacturing, automotive, energy and green technology sectors.
She added its direct connectivity to the Butterworth-Kulim Expressway provides efficient access to key economic and logistics hubs including Kulim town centre, Kulim Hi-Tech Park, North Butterworth Container Terminal and Penang Bridge, enhancing its attractiveness to industrial occupiers.
“Our latest proposed freehold acquisition will strengthen Axis-REIT’s presence in the northern industrial corridor. The property is an industrial complex utilised as a modern manufacturing facility which produces batteries and accumulators,” Leong said in a statement.
For the second quarter ended June 30, 2026 (2Q26), Axis REIT’s net trust income fell by 1% year-on-year (y-o-y) to RM46.30mil or earnings per share of 2.28 sen, mainly due to lower property income and higher property expenses. Total trust income declined by 2% y-o-y to RM88.80mil, mainly due to lower occupancy of the existing portfolio.
For the six-month period ended June 30, 2026 (6M26), Axis REIT’s net trust income increased by 4% y-o-y to RM99.50mil or earnings per share of 4.91 sen. Total trust income dropped by 0.4% y-o-y to RM179.35mil for 6M26.
In a filing with Bursa Malaysia, Axis-REIT said the manager is optimistic that in view of the satisfactory performance of Axis-REIT’s existing property portfolio and its growth strategy to actively pursue quality investments, it will be able to maintain its current performance for the financial year ending Dec 31, 2026.
Leong said the moderation in quarterly performance was primarily due to the suspension of rental for Wisma Kemajuan since the fire incident in February pending the payout of the fire consequential loss takaful insurance and higher one-off operating expenses in the quarter. She said these factors temporarily impacted income contribution.
“Our diversified portfolio of high-quality industrial and logistics assets continues to provide a strong foundation for recurring income generation. As we move into the second half of the year, our priority is to strengthen portfolio occupancy while continuing to expand our footprint with assets that complement our long-term investment strategy and enhance the overall quality of the portfolio,” she said in a statement yesterday.
Axis-REIT declared a second interim income distribution of 2.30 sen per unit, payable on Aug 28, 2026, with the ex-date on Aug 12, 2026.
Axis-REIT’s share price closed two sen higher at RM1.94 per unit today.
