KUALA LUMPUR (July 1): MRCB-Quill Real Estate Investment Trust (MRCB-Quill REIT) is buying Menara Shell in KL Sentral from Malaysian Resources Corp Bhd (MRCB) for RM640 million.
This would raise MRCB-Quill REIT’s asset portfolio size to RM2.27 billion from RM1.63 billion as at December 2015, the trust said in a statement posted on Bursa Malaysia.
Menara Shell consists of a 33-storey office tower, a five-storey podium and a four-storey basement car park with 915 parking bays and 110 motorcycle bays. The building has 557,053 sq ft of net lettable area and a current occupancy of 99.9%.
MRCB-Quill REIT said the purchase consideration will be fully settled in cash, which will be raised through a combination of equity and debt funding exercises.
“The equity funding exercise will entail a proposed placement involving the issuance of up to 406.67 million placement units,” it said, adding that the units will be placed out to institutional investors by way of a book-building exercise at an issue price to be determined later.
Commenting on the deal, MRCB group managing director Tan Sri Mohamad Salim Fateh Din said the disposal of Menara Shell is in line with its strategy to monetise development projects once they are completed and tenanted in order to reinvest the capital in core businesses of property development and construction.
Meanwhile, MRCB-Quill REIT chairman Tan Sri Saw Choo Boon said the property is a strategic fit to its current portfolio of 10 quality commercial properties.
Notwithstanding the soft office market outlook, Saw is positive about the growth prospects of the trust as it increase its footprint in KL Sentral.
This article first appeared in The Edge Financial Daily, on July 1, 2016. Subscribe to The Edge Financial Daily here.
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