The manager of CapitaLand Malaysia Trust (CLMT), a wholly-owned subsidiary of CapitaLand Investment, has signed an agreement to acquire three freehold industrial properties from Rainbow Entity, a subsidiary of Bursa-listed Gromutual Berhad, for RM72.0 million ($22.0 million). The properties are located within Senai Airport City (SAC), a modern industrial and manufacturing hub in the Senai region within the Johor-Singapore Special Economic Zone (Johor-Singapore SEZ).
With a collective built-up area of 183,785 sq ft, the properties consist of three single-storey detached factories, each annexed with a two-storey office block.
The purchase consideration is at a discount to the independent market valuation of RM72.5 million commissioned by MTrustee Berhad (the trustee for CLMT). The construction of the properties is scheduled to be completed in the first quarter of 2025. CLMT will also enter into a long-term lease agreement of seven years with a tenant for one of the three properties. The lease comes with built-in rent escalations and is expected to provide income stability to CLMT’s portfolio.
The tenant is listed on the Shanghai Stock Exchange STAR Market and is in the life sciences industry. When the three properties are fully leased, the acquisition will contribute positively to CLMT’s income and is expected to be distribution per unit (DPU) accretive. The three properties are projected to generate an annual gross rent of RM5.1 million, with a first-year gross yield of approximately 7.1%.
Since 2024, CLMT has announced investments of about RM280 million3 in industrial and logistics assets. Post-transactions, CLMT’s enlarged portfolio will comprise 15 properties, with the proportion of industrial and logistics properties increasing from 10% to 18% of the total portfolio’s net lettable area, amounting to approximately 4.7 million sq ft. Its industrial and logistics assets under management will increase from 2.8% to 7.9%.
Yong Su-Lin, CEO of CapitaLand Malaysia REIT Management (CMRM), the manager of CLMT, says: “The acquisition of three freehold industrial properties in the Senai-Skudai region marks CLMT’s second foray into the industrial sector in Johor, which is developing into a significant manufacturing hub.”
“Over the last six months, we have observed robust leasing interest for industrial assets in Johor. The initial three industrial assets we acquired at Nusajaya Tech Park are fully leased and we are now in the final stages of securing a single tenant lease for one of the properties in our latest acquisition. By securing prime assets in strategic locations, we are well-positioned to capitalise on the growing demand from companies looking to establish industrial facilities in the newly announced Johor-Singapore SEZ.”
Shares in CapitaLand Investment closed at $2.45.
