PETALING JAYA: The overall net property income (NPI) of KIPMall Setapak is expected to grow despite the temporary rental downtime during the supermarket transition, supported by stronger performance across the rest of the mall.
According to TA Research, beyond the mall’s rental gains, the refreshed tenant mix should strengthen the mall’s appeal to its surrounding catchment and encourage repeat visits for groceries and dining.
With its RM435mil acquisition of Setapak Central Mall officially as of Sept 30, KIP Real Estate Investment Trust
(KIP-REIT) has fully locked in its next leg of growth, driving its assets under management past RM2.2bil well ahead of schedule.
Following the unveiling of KIPMall Setapak, marking the renaming of Setapak Central and KIP-REIT’s first KIPMall in Kuala Lumpur, the visit reinforced TA Research’s positive view on the RM435mil acquisition.
This is supported by stronger NPI ahead of takeover and planned tenant changes to lift rental income.
“KIPMall Setapak has 514,777 sq ft of net lettable area and was 99.9% occupied as of February 2026.
“Based on the shareholders’ circular, the mall generated NPI of RM31.3mil in 2025, implying a 7.2% yield on the RM435mil purchase price.”
TA Research has maintained its “buy” call on the counter, raising its target price to RM1.18 from RM1.08, representing a potential upside of 38.6% from its last traded price of RM0.85.
The acquisition is KIP-REIT’s largest asset by value and strengthens its Klang Valley retail exposure,” the research house explained. With the indication that NPI had grown approximately 10% as at June, TA Research said applying this increase to the circular’s historical NPI implies an annualised level of approximately RM34.4mil.
“Furthermore, management has secured premium anchor tenants, including premium grocer Jaya Grocer, which will replace former anchor tenant Econsave in April 2027.
“The transition allows the REIT to optimise its floor layout, as Jaya Grocer will occupy roughly 14% less area than its predecessor. The freed-up space will be reallocated to higher-yielding food and beverage (F&B) and lifestyle retail lots,” it further added.
Following the acquisition and a recently completed private placement raising RM163mil, TA Research revised KIP-REIT’s earnings forecasts upward by 14.1%, 22.2%, and 27.3% for FY27, FY28, and FY29, respectively.
