KUALA LUMPUR: AmFIRST Real Estate Investment Trust (AmFIRST REIT) unit holders today approved the proposed RM331 million disposal of Menara AmBank, paving the way for the REIT to pursue new acquisitions, including hospital-related assets.
AmREIT Managers Sdn Bhd chief executive officer Chong Hong Chuon said the disposal would reduce AmFIRST REIT’s gearing to about 33 per cent from 46 per cent-47 per cent, providing the REIT with a healthier balance sheet to pursue its portfolio diversification strategy.
"The first part of rationalisation, I think we are done with the disposal. So then we now go for diversification,” he told a press conference following AmFIRST REIT’s annual general meeting (AGM) and extraordinary general meeting (EGM) here today.
Chong said the REIT had been actively scouting for investment opportunities even before the disposal and had evaluated various property subsectors, including hospital-related assets.
"We would consider defensive assets with long-term leases and good tenants, while remaining open to opportunities that meet its investment criteria.
"Following the disposal, he said the office component of AmFIRST REIT’s asset portfolio would decline to 45 per cent from 62 per cent, allowing it to diversify its asset mix further,” he said.
Chong said potential acquisitions could also provide additional earnings upside, particularly if the REIT could acquire assets yielding six to seven per cent against borrowing costs of about four per cent.
"Barring unforeseen circumstances, the proposed disposal is expected to be completed in the last quarter of 2026,” he said.
On Budget 2027, he said the removal of the 10 per cent withholding tax on REIT distributions remained at the top of the industry’s wish list, adding that the industry had been engaging with the government on the matter.
He said the industry also hoped for a more business-friendly tax structure amid higher costs of doing business.
Meanwhile, Chong said the outlook for the office property segment was improving, with AmFIRST REIT seeing more enquiries over the past two years as businesses returned to physical offices and expanded their operations.
"Conditions were better than during and immediately after the COVID-19 pandemic, when the sector was affected by oversupply and the work-from-home trend.
"The retail segment was also showing positive momentum, while the hospitality sector continued to see encouraging demand, supported by visitor arrivals,” he added.
Also present at the press conference were AmREIT Managers deputy chief executive officer Zuhairy Md Isa, head of finance Abdul Rahman Mohd Joned, and head of marketing and leasing Danny Chee Kok Leong. - Bernama
