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Unlocking value of investment assets: Sunway City had proposed to inject its entire eight investment properties into “real estate investment trust” (REIT). The offer price is yet to be determined. The properties included will be (1) Sunway Pyramid shopping mall; (2) Sunway Resort Hotel and Spa; (3) Pyramid Tower Hotel; (4) Menara Sunway; (5) Sunway Hotel Seberang Jaya; (6) Suncity Ipoh Hypermarket; (7) Sunway Carnival Mall and (8) Sunway Tower. These REITs could be valued around RM3 billion which is about 63.8% of the total investment properties under Sunway City holdings that also includes other assets like Sunway Giza, Sunway University College and Monash University Sunway Campus.
Timely launching of REIT: In FY2009 Sunway City enjoyed a revaluation gain of RM804.9 million from its investment properties. Sunway Pyramid Shopping Mall was revalued to RM2244.4 million, raising their fair value gain by RM680.4 million. Sunway Carnival Mall was revalued to RM248.5 million, lifting the fair value gain by RM58.5 million. Twenty other investment properties were also revalued to RM847.6 million, which rose the fair value gain to RM66 million. The proceeds raised from REIT will be used for the property division, i.e. for two office towers expected to be launched by end 2010. The 1st tower with 277,000 sq ft of NLA will be built next to Sunway Resort Hotel & Spa and linked to Sunway Pyramid Mall. The 2nd tower with 550,000 sq ft of NLA will be built next to Menara Sunway. SunCity will spend RM400 million to build the towers, which could either be leased or sold via en bloc or injected into REIT.
